Samsung Electronics unveils foundry vision to catch up with TSMC

Dr. Choi Si-young, President and Head of Foundry Business at Samsung Electronics, delivers a keynote speech at Samsung Foundry Forum (SFF) 2023 held in Silicon Valley, California, U.S. on June 27 (local). [Photo provided by Samsung Electronics]

South Korea’s tech giant Samsung Electronics Co. on Tuesday unveiled a detailed roadmap and specific performance level of the 2-nanometer chip process it plans to mass produce in 2025.

Under the plan announced at the annual Samsung Foundry Forum (SFF) 2023 in Silicon Valley, U.S., Samsung Electronics will begin mass production of the 2-nm process for mobile applications in 2025, expand to the high-performance computing process in 2026, and automotive process in 2027.

Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s No. 1 foundry company, had also announced mass production of its 2-nm process in 2025 but it has not yet disclosed specific plans.

Samsung Electronics’ 2-nm process offers a 12 percent increase in performance and a 25 percent increase in power efficiency compared with the 3-nm process. It requires about 5 percent less area.

The company said that the development of the next step, the 1.4-nm process, is also on track and that it is confident of achieving mass production in 2027 as planned.

Samsung Electronics also announced plans to enhance next-generation processes, production capacity, and intellectual property (IP) to catch up with TSMC. Having lost 60 percent of its market share to TSMC in the first quarter, the company is determined to narrow the gap.

The company is actively expanding its production capacity in the U.S. and Korea. In order to respond quickly and flexibly to market demand, it is building semiconductor clean rooms in Pyeongtaek, Gyeonggi Province and Taylor in Texas, U.S.

The company plans to increase the size of its foundry clean room by 7.3 times by 2027 compared to 2021. In addition to Line 3 in Pyeongtaek, which started operations this year, Line 1 in Taylor, which is currently under construction, will be completed in the second half of this year as planned, and will be in full operation in the second half of next year.

The company will also expand its production base to Yongin, Gyeonggi Province, which is being developed as a national industrial complex. This intensive construction plan contrasts to TSMC’s recent diversification of its global bases.

TSMC has recently been expanding its presence in Europe and Japan. The Taiwanese company is in talks to build a 10 billion euro ($10.9 billion) facility in Dresden, Germany. It is also planning to build two factories in Kumamoto Prefecture, Japan.

In addition to expanding production capacity, Samsung Electronics is also diversifying its product portfolio to gain a competitive edge against TSMC.

Dr. Choi Si-young, President and Head of Foundry Business at Samsung Electronics, unveils a new chipmaking roadmap at Samsung Foundry Forum (SFF) 2023 held in Silicon Valley, California, U.S. on June 27 (local). [Photo provided by Samsung Electronics]

The company has designated the so-called “third-generation semiconductor” as a new growth driver. A representative example is the 8-inch gallium nitride (GaN) power semiconductor.

Existing power semiconductors are mainly made of silicon (Si) materials, but recently, next-generation power semiconductors based on new materials such as GaN that maximize power efficiency and durability have gained attention.

The 6th generation semiconductor is also a new challenge. In order to secure the leading technology, Samsung Electronics has decided to develop a 5-nm radio frequency (RF) dedicated process, with an aim to start mass production in the first half of 2025.

Samsung Electronics also emphasized that it will significantly strengthen its intellectual property (IP). This area has been considered one of Samsung Electronics’ biggest disadvantages against TSMC.

A foundry company takes on production when a customer brings in a semiconductor blueprint. IP is a particularly an important asset in the foundry business, where low-volume production of a wide variety of products is key. As a result, fabless companies specializing in semiconductor design naturally look for foundries that have a lot of IP.

Samsung Electronics said at the forum that it has secured more than 4,500 IPs with 50 global IP partners. This is more than three times the level in 2017. At the end of last year, TSMC reportedly had more than 55,000 IP assets, a 37 percent increase from the previous year. Even Intel Corp., a latecomer in the foundry industry, is considered to have an advantage over Samsung Electronics in the IP field.

Samsung Electronics, however, has not lost confidence as it has already succeeded in establishing the gate-all-around (GAA)-based advanced node technology structure, which is the core of its next-generation process.

GAA is a technology that maximizes the area of the gate to increase data processing speed and power efficiency. Samsung Electronics was the world’s first to introduce GAA in a 3-nm process in June last year to target the sub-3-nm foundry market. TSMC plans to introduce GAA in its 2-nm process.