Samsung, SK hynix compete for low power semiconductors

[Graphics by Song Ji-yoon and Yoon Yeon-hae]

Samsung Electronics Co. and SK hynix Inc.’s competition for ‘low-power semiconductors’ is intensifying as the South Korean chipmakers continue to compete for market share in the high-bandwidth memory (HBM) chips space. A growing number of global big tech companies seek low-power semiconductors alongside those with high-performance and high-capacity as the artificial intelligence (AI) boom continues.

According to sources from the semiconductor industry on Tuesday, Samsung Electronics and SK hynix are each aiming to dominate the low-power double data rate (LPDDR) memory market as LPDDR expands its application from mobile devices to data centers, on-device AI, and more.

The International Energy Agency predicts that power consumption by data centers will increase to 1,050 terawatt-hours (TWh) by 2026, more than doubling from 2022’s 460 TWh figure.

Global big tech firms are also focusing on LPDDR, and Nvidia Corp. Chief Executive Officer Jensen Huang recently said that his company is “using LPDDR to reduce server power consumption.” The LPDDR market is growing rapidly, with market research firm Omdia predicting that the LPDDR market, which was worth $12.34 billion in 2023, will be worth $25.5 billion in 2027.

The LPDDR market is currently dominated by Samsung Electronics and SK hynix., Samsung holds a market share of 54.8 percent as of 2023, which is bigger than SK‘s 23.5 percent share, and developed the LPDDR5X, which can transmit 10.7 gigabytes (Gb) per second, in April 2024 to lead the speed competition.

“We have improved performance by 25 percent, capacity by 30 percent, and power consumption by 25 percent compared to the previous generation,” a Samsung Electronics official said.

Samsung plans to begin mass-producing the new product in the second half of 2024 after customer verification.

[Courtesy of SK hynix and Samsung Electronics]

The company is also accelerating the development of LPCAMM, a package that combines LPDDR. It pioneered the market by developing the industry’s first LPDDR5X-based LPCAMM2, which reduced the mounting area by 60 percent while improving performance by 50 percent and efficiency by 70 percent, in September 2023. The company aims to start mass production within 2024 after it verifies the product on the Intel platform.

While Samsung has pushed LPDDR speeds to ‘industry-leading,’ SK hynix has launched its own upgraded version. It introduced LPDDR5T, an upgraded version of LPDDR5X, in November 2023 ahead of its 8th generation product, LPDDR6. LPDDR5T can transfer 9.6 gigabytes per second (Gbps) of data with a 13 percent performance increase over LPDDR5X.

SK hynix plans to commercialize 10.7Gbps products soon.

The company is also catching up with Samsung by developing LPCAMM2.

“In addition to HBM, we will strengthen our position by quickly responding to the market with our new AI memory products such as LPCAMM2,” according to Kim Kyu-hyun, head of DRAM marketing at SK hynix.

The industry is paying attention to the development and mass production timing of next-generation LPDDR6 products.

“Semiconductor companies will speed up their development and mass production once the LPDDR6 standard is set,” an industry insider said. “Given the time they took to develop and mass-produce their existing products, Samsung Electronics and SK hynix will likely introduce LPDDR6 to the market in 2025.”