Intel explains why it is outsourcing chip manufacturing to TSMC

Intel has decided to contract TSMC to mass-produce its ARC GPUs on its 6nm process. There is a whole lot of planning that goes on before finally deciding which process to follow. According to Intel Vice President Raja Koduri, “It is necessary to first determine the process that can be assumed at the start of design,” “Other features, such as how much operating frequency can be used are also important factors. Cost is also an issue. These three, that is, the cost-performance-capacity are taken into consideration when deciding which process to use. ”

Intel has stated that Alchemist found the best equilibrium on the N6 node of TSMC. Also taking into account Intel’s delay in the process and competitive environment with big players like AMD and NVIDIA around, building a new product on a regular node could have easily impacted the performance potential of ARC GPU.

Supply issues have terribly impacted the semiconductor manufacturing industry for the past 18 months, with complex supply chains to blame. However, Intel had an edge here due to its vertical strategy and reliance on in-house designing and manufacturing. This gave Intel more flexibility to pre-plan its assembly lines and transition swiftly according to the market conditions.

There are other factors as well when it comes to GPUs. Being comparatively bigger when compared to CPUs, they require more transistors that result in fewer chips per wafer. Roughly, GPUs swell more than six times the die when competed against CPUs.

There’s, of course, a well-planned strategy to bite into the capacity of Intel’s rivals by reserving a big chunk of the N6 node for its own production. This will allow Intel to mass-produce ARC GPUs to feed the demand, while simultaneously ensuring that they remain a step ahead of the competition by occupying TSMC’s resources. Gizmochina