Published: 8 June, 2012
Samsung is to invest $1.9bn in new production facilities for mobile processors, no doubt seeking to keep its manufacturing deal with Apple despite the companies' legal battles. The Korean firm will also be targeting a greater share of the booming market for smartphone and tablet processors, as it battles with pure-play foundries like TSMC.
Samsung Electronics has its own mobile processor line, Exynos, which it sells to its handset sister company as well as other device makers. It also makes mobile chips for others, most famously Apple, whose A4/A5 family Samsung originally co-designed and still manufactures. However, the iPhone maker has been transferring some of that business to Taiwanese foundry TSMC in an effort to become less reliant on its chief handset rival. Apple remains one of the Samsung group's largest customers, buying displays, memory, chips and other items.
Samsung plans to build a new logic chip line specifically for mobile processors, using 300mm wafers and 20 nanometer and 14 nanometer processing technology. Chipmakers are moving to processes of 28nm and less, to gain efficiencies in size, cost and power consumption, but Qualcomm recently admitted to shortages of its 28nm processors as TSMC struggled to get the new process to full capacity. The giant Taiwanese foundry is also working on 20nm technology, while Intel is using 22nm for its new Ivy Bridge products.
Samsung says its new line will be complete by the end of next year and will hope that it gets to 14nm ahead of larger foundry rivals, gaining an edge in the mobile market. Even with less cutting edge technologies, there is significant new demand to meet. Demand for processors for smartphones and tablets is set to more than double to $59bn by 2016, from $23bn last year, according to research firm Gartner.
Samsung recently announced that it would build its first chip manufacturing plant in China to make NAND flash memory chips, spending a probable sum between $3.4bn and $4.2bn.
It has also named a new CEO this week. Oh-Hyun Kwon, previously head of its components business, will replace Geesung Choi at the helm, though he will also continue to oversee the component unit. Choi will retain his position as vice chairman of the board, and will also head the company's group corporate strategy office.