TSMC: Supercomputing, AI Will Drive Semiconductor Business, Not Phones

TSMC: Supercomputing, AI Will Drive Semiconductor Business, Not Phones

For the last few years, phone and tablet SoCs have been the driving force behind product cycles and foundry technology improvements. Over the last decade, yearly product introduction cycles for phones became the norm, and the entire semiconductor industry retooled to match this requirement. Now, TSMC thinks the bloom is off this particular rose.

HPC — high-performance computing — has replaced phones as the major driver of revenue, according to TSMC. While this includes some hardware common to the PC, like GPUs, it also includes accelerators, new specialized types of microprocessors designed for inference and machine learning workloads, AI processors, and a wealth of other types of products. There’s probably even some overlap between categories; some companies like Qualcomm have played up the idea of leveraging its SoC capabilities of CPU, GPU, and DSP in the same package as a heterogeneous compute platform.

TSMC headquarters in Hsinchu, Taiwan.
TSMC headquarters in Hsinchu, Taiwan.

TSMC, meanwhile, is expecting the profits for those wins to wind up in its own coffers. The company projects annual revenue for 2018 could be up as much as 15 percent, with the semiconductor industry as a whole growing roughly 8 percent. This graph from Statista shows market share data for TSMC versus everybody else.

TSMC: Supercomputing, AI Will Drive Semiconductor Business, Not Phones

Whoof. GlobalFoundries and UMC check out alright, but everybody else is buried back in the minor leagues (and UMC really isn’t a leading-edge foundry). Samsung, were it on this graph, would presumably account for as much market share as GF, but Samsung isn’t a pure-play foundry (it builds hardware for its own use as well).

Shifting over to HPC as a revenue driver, as opposed to the phone market, implies some interesting things about the future of phones. It was companies like Apple and Samsung that pushed foundries to roll out yearly cadence updates and indirectly encouraged a reduction in capability between foundry nodes. The reason we now hear so much about second- or third-generation process nodes is because everyone now expects each new SoC to offer improved performance on yearly cadences, even when those cadences don’t align with foundry upgrade cycles.

Overall, we don’t expect introduction speeds to slow down much. While shifting away from phones with their yearly cadences might seem attractive in certain businesses, there’s an army of marketing teams and a keeping-up-with-the-jones’ mentality that push for yearly product cycles, even when they don’t necessarily make much sense. TSMC’s sales growth may also be the result of winning back Qualcomm, which is rumored to be moving back to TSMC with the Snapdragon 845.

Top image credit: Facebook data center

Continue reading

Huawei’s Phone Deal With AT&T Reportedly Killed On Account of Politics
Huawei’s Phone Deal With AT&T Reportedly Killed On Account of Politics

The upcoming (and unannounced) deal with AT&T to sell the new Mate 10 series was supposed to be the start of Huawei's push into North America, but the deal has reportedly fallen apart at the last minute after AT&T got cold feet, and some sources point to a political cause.

Razer Phone Gets Netflix HDR and Dolby 5.1 Sound
Razer Phone Gets Netflix HDR and Dolby 5.1 Sound

The company has announced a deal with Netflix that brings HDR and Dolby Digital Plus 5.1 sound to the Razer Phone.

Vivo Demos First Smartphone With In-Display Fingerprint Sensor
Vivo Demos First Smartphone With In-Display Fingerprint Sensor

At CES, Chinese smartphone maker Vivo is on hand to show off the first ever phone with a fingerprint reader inside the display.

Apple Will Let Users Deactivate Performance Throttling on iPhones
Apple Will Let Users Deactivate Performance Throttling on iPhones

Apple has come under fire in recent weeks for its decision to slow down older iPhones with degraded batteries, but it wasn't just the actions that got Apple in hot water.