In the last quarter of 2020, Apple introduced the A14 Bionic, its first iPhone, which is equipped with a processor engraved in 5 nm. Shortly thereafter, Qualcomm presented its Snapdragon 888 processor, which also uses this technology and drives models such as the Xiaomi Mi 11 and some versions of the Galaxy S21.
This technology, the 5 nm engraving process, enables processors to be designed that are more efficient and energy efficient. While the first smartphones are coming onto the market with chips engraved in 5 nm, some players are already thinking about the next development: processors engraved in 3 nm.
Samsung: $ 10 billion to make chips that were engraved at 3 nm in the US?
And among those players there is Samsung. As a reminder, Samsung uses Qualcomm’s Snapdragon chips on some of its smartphones, while others use Exynos chips, a subsidiary of Samsung that specializes in chips for cell phones.
According to a new rumor, Exynos is planning to invest heavily in the production of chips that are engraved in 3 nm. In any case, this is suggested in a recent article published by Bloomberg.
A project in Texas to compete with TSMC?
According to this article, Samsung plans to invest more than $ 10 billion to manufacture a facility in the US, likely in Austin, Texas, that will specialize in chips. This system could later produce chips engraved in 3 nm.
As for the schedule, Samsung plans to start construction this year, install the equipment in 2022, and then start operations in 2023. At the moment this is a rumor so caution is advised.
On the other hand, Samsung is expected to continue negotiating with the new Biden administration, according to Bloomberg. For example, the Korean giant could ask for incentives. However, the article suggests that Samsung could start the project even without these incentives.
Move some of the production to the US
In any case, this investment in the US would allow Samsung to narrow the gap between its subsidiary, which specializes in chips, and founder TSMC, a specialist who, for example, makes the chips used by the iPhone. Also, Samsung could lessen the impact of the US-China trade war on its business and attract more American customers as the new facilities would be on Uncle Sam’s lands.
As Bloomebrg notes, the recent COVID-19 crisis has also fueled uncertainty about the global supply chain (as it is today). It should also be noted that Samsung Exynos’ main competitor TSMC also has an installation project that would cost $ 12 billion on American soil (in Arizona).
In any case, this news comes at a time when rumor has it that new players in the electronics market are considering developing their own chips (based on Arm technologies). However, when companies like Microsoft or Google decide to develop their chips (for smartphones or computers), they have to entrust the production to founders like Samsung Exynos or TSMC.
Even Huawei, which boasts of using its own Kirin processors instead of Qualcomm, only designs the chips while manufacturing is done by contractors. When Washington announced new sanctions in 2020, these subcontractors were no longer able to supply Huawei with Kirin chips.