What is the Big Deal About 3nm Chips?

Apple will be TSMC's first 3nm chip customer for the M2-powered MacBook Pro series.
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Apple has always been a step ahead of its competitors. According to the latest report, Apple will be TSMC’s first 3nm chip customer for the M2-powered ‘MacBook Pro’ series.

Taiwan Semiconductor Manufacturing Company (TSMC), a multinational semiconductor contact chipmaker, announced ‘risk production’ of the much-awaited 3-nm process node in the next half of 2022, tentatively September. TSMC manufactures semiconductors for technology giants like Apple and Nvidia. Early revelations about the 2nm chips set to arrive by 2025 have also been made.

Risk production means that the company has developed basic production formulas, and the process has passed reliability tests. The announcement is an upgrade from the 5nm process that was rolled out for mass production in 2020

Small chips, big impact 

TSMC and Samsung are set to become the only two entities producing 3nm chips globally. The chips will enable the development of integrated circuits that speed up the device performance without draining the battery. The technological advance is expected to cater to the 5G smartphones market and other electronic products.

TSMC’s technology would be used in central processors, graphics processors, and AI accelerators—collectively known as ‘high-performance computing’. Modem chips for 5G and future generation 6G wireless devices would also use TSMC’s 3nm technology.

The 3nm process allows 250 million transistors per square nanometre while the 2nm technology will enable over 310 million transistors in the same area. Higher transistor counts lower power consumption while enabling better performance with the same power usage.

But where do other players stand in the market?

Samsung’s chip division has significantly contributed to the company’s success, especially with the global chip shortage since the pandemic. It contributed two-third of the company’s operating profit in FY-22 Q2.

Applying Gate-All-Around (GAA) transistor architecture, Samsung Electronics has already begun shipping out 3nm chips, but only for cryptocurrency miners.

The company recently announced a new research and development facility for semiconductor chips. The new plant is in South Korea, and the company is expected to spend KRW 20 trillion (nearly $15 billion) on this facility by 2028.

The new facility will be a critical research base for the company in semiconductor R&D fields such as fabless system semiconductor design, foundry, and memory. The semiconductor R&D line is likely to be operational in 2025.

In April 2022, Intel Corp announced the arrival of the 18A (10 angstroms = 1 nanometre) node, which had earlier been postponed to late 2024 and was originally expected to be launched in 2025. 18A is a refinement of 20A, which was announced as a part of the company’s ‘five nodes in four years’.

In the collective memory, the company had stalled out from 2015 to 2019, trying to move from 14nm to 10nm. The news around 2nm seems to be an announcement to silence the critics who had suggested that the company may be unable to advance to new nodes over time.  

​As per a recent announcement, Intel will manufacture chips for MediaTek, establishing it as the first major silicon customer for Intel’s revitalised contract chip manufacturing business.

Announced in 2021, IBM’s 2nm chip is expected to perform 45 per cent better or use 75 per cent less energy than their current, most advanced 7 nm node chips. The company also claims that its chips are slightly denser than TSMC’s upcoming 3nm chips. 

The Big Blue does not manufacture its own chips anymore. It already shares its chip designs with other companies through the OpenPOWER consortium, and its most advanced 7nm Power chips are produced by Samsung—which certainly can’t mass produce 2nm chips yet.

TSMC—The Flag Bearer

Earlier in August 2022, US House Speaker Nancy Pelosi’s controversial trip to Taiwan re-emphasised the island nation’s critical role in the global chip industry, particularly TSMC.

The Taiwanese chip manufacturing giant reported high demand for chips used in 5G smartphones, notebooks, and high-performance computers in 2019. As a result, its 2020 revenue rose 25.2 per cent yearly to NT$ 1.33 trillion (US$ 47 billion).

According to analysts, the volume production of chips below the 2nm level will require developing new materials and a purpose-built factory—both very costly investments.

TSMC accounts for nearly 50 per cent of the global production of microchips of sizes 10nm and below. Nearly 50 per cent of all microchips produced by TSMC are imported by China. In the last fiscal year alone, China imported microchips worth $104 billion.

The Taiwanese giant’s 2nm and 3nm processes are likely to give it an edge over its major rival, Samsung Electronics, while also keeping it well ahead of Semiconductor Manufacturing International Corp (SMIC).

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Tasmia Ansari
Tasmia is a tech journalist at AIM, looking to bring a fresh perspective to emerging technologies and trends in data science, analytics, and artificial intelligence.

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