Samsung Electronics Corporation, the world's largest memory chip manufacturer, has won the Preferred Networks Inc., a leading Japanese company(PFN) won the first 2nm node AI chip production contract to beat TSMC's advanced chip processing technology.
Under the agreement, South Korea-based Samsung will use its latest 2-nanometer chip processing technology for PFN to produce AI accelerators and other AI chips, sources said Friday.
PFN has been working with TSMC since 2016 but decided to produce next-generation AI chips on Samsung's 2nm node, a person familiar with the matter said.
*The deal is beneficial for both parties, with PFN gaining access to newer chip technology that will give it an edge over the competition, while Samsung noted that the most advanced chip technology has won over actual customers, making progress in the battle for the foundry market with TSMC, sources said.
Founded in 2014, PFN is known for its expertise in AI deep learning development, attracting massive investments from tech companies such as Toyota, NTT, and Japanese robotic system manufacturers.
According to the sources, PFN has decided to abandon TSMC because Samsung provides a full range of chip manufacturing services from chip design to production and advanced chip packaging. Samsung** declined to confirm its deal with PFN. The deal opens the door to more 2nm customers, and while TSMC currently has more than 2nm customers, a reversal that could be beneficial to Samsung opens the door for more big customers to side with the South Korean chipmaker, analysts said.
TSMC is a leader in foundry chip manufacturing, stealing most of its business from fabless chip design companies like Apple and Qualcomm.
As the demand for high-performance chips continues to rise, the competition for technological advancements is fierce, especially between TSMC and Samsung.
Ahead of Samsung, the Taiwanese chipmaker, which offers TSMC built with its 2nm technology to customers such as Apple and Nvidia, aims to start mass production of chips with 2nm technology in 2025.
Samsung also said it will begin mass production of the 2 nm process for mobile apps in 2025, and then divide other uses in the coming years.
Samsung said it will evaluate high-performance computing (HPC) chips for supercomputers and computer clusters with advanced 2nm technology in 2026, and then automotive chips in 2027.
Samsung plans to start mass production of the more advanced 1 by 20274 nm chips.
The chip manufacturing process is labeled with a numeric size label that roughly indicates the thickness of the circuit of a transistor that can be encapsulated on a chip. The lower the number, the more advanced the technology.
Samsung's production technology is based on a microprocessing process based on a GAA transistor architecture, while TSMC uses a different technology in a fin-effect transistor (FinFET) structure.
Starting from the 2nm node, foundry faucets will also adopt GAA technology. will surpass TSMC with our technology in the next five years," Kyung Kye-Hyun, head of Samsung's Device Solutions division, which oversees semiconductors, said at a forum in South Korea last year.
Samsung strives to surpass TSMC in 2nm technology.
Samsung Electronics is accelerating its competition with Taiwan's TSMC and Intel in the United States to launch advanced 2nm process technology in an effort to take a leading position in the global foundry market. The competition between the three companies is driven by OpenAI's CEO Sam Altman, who is also the developer of ChatGPT, a generative AI chatbot. These companies announced their independence in AI semiconductor technology and raised 930 trillion won in investment to become Altman's foundry partners.
The focus is on whether Samsung Electronics, the second largest in the global foundry market, will surpass TSMC to take the first place in the 2nm competition, or be the first to obtain a new generation of lithography equipment.
Market research firm Omdia, Feb. 14** The global foundry market size is expected to reach $126.4 billion this year, with an average annual growth rate of 138% to 1538$300 million. This rapid growth is expected to be driven by state-of-the-art processes below 5 nanometers. Sub-5nm process sales accounted for 24 percent of total sales last year8% and is expected to soar to 41 by 20262%。
Samsung Electronics is leading the way in the development of 3nm and 2nm gate-by-ring (GAA) technologies and plans to expand its business with advanced process technology. GAA technology surrounds three sides of the channel and increases the gate area compared to conventional FinFET structures, overcoming the degraded transistor performance due to process miniaturization, improving data processing speed and power efficiency.
Samsung is continuing to stabilize the mass production of the 3nm GAA process and accelerate the development of the 2nm process. TSMC plans to introduce GAA technology in its 2nm process for the first time. The industry speculates that Samsung adopted GAA technology earlier than TSMC and may have the upper hand in the 2nm competition.
Intel will host a foundry forum on Feb. 22 that will announce the detailed direction of its business, which Microsoft CEOs Satya Nadella and Sam Altman are also expected to attend. Intel plans to begin production of its GAA-based 20 Angstrom (A) process in the first half of this year. Intel received ASML's next-generation lithography equipment last year and plans to apply it to a 2nm process, using a 20 A process to produce its ** processor (CPU) products, and offering an 18 A process to foundries for mass production in 2025. However, it is common in the industry to ** that Intel may face challenges in adhering to the timeline due to the initial release of next-generation lithography equipment.