So our Gross Margins will go even lower if we succeed in Mobile??????
Am I missing something, or are we done growing forever? And this looks like Intel getting to 14nm doesn't mean much.
by David Manners
Intel has no advantage in IC manufacturing when it comes to manufacturing processes used for mobile ICs, Warren East, CEO of ARM, tells EW.
"This time last year there was a lot of noise from the Intel camp about their manufacturing superiority," says East, "we're sceptical about this because, while the ARM ecosystem was shipping on 28nm, Intel was shipping on 32nm. So I don't see where they're ahead."
Furthermore, with the foundries accelerating their process development timescales, it looks increasingly unlikely that Intel will be able to find any advantage on mobile process technology in the future.
"We're supporting all the independent foundries," says East. That includes 20nm planar bulk CMOS and 16nm finfet at TSMC; 20nm planar bulk CMOS and 14nm finfet at Samsung and 20nm planar bulk CMOS, 20nm FD-SOI and 14nm finfet at Globalfoundries.
It gives the ARM ecosystem a formidable array of processes to choose from. "I'm no better equipped to judge which of these processes will be more successful than anyone else," says East, "our approach is to be process agnostic."
The important thing is that the foundries' process roadmap is on track to intersect Intel's at 14nm.
14nm will be the first process at which Intel intends to put mobile SOCs to the front of the node i.e. putting them among the first ICs to be made on a new process.
Asked if the foundries were prepping their next generation processes with the intention of putting mobile SOC at the front of the node, East replies: That's the information we're seeing from our foundry partners."
Globalfoundries intends to have 14nm finfet in volume manufacturing in 2014, the same timescale as Intel has for introducing 14nm finfet manufacturing.
In fact, GF's 14nm process may have smaller features than Intel's 14nm process because, says Mojy Chian senior vp at Globalfoundries, because "Intel's terminology doesn't typically correlate with the terminology used by the foundry industry. For instance Intel's 22nm in terms of the back-end metallisation is similar to the foundry industry's 28nm. The design rules and pitch for Intel's 22nm are very similar to those for foundries' 28nm processes."
Jean-Marc Chery, CTO of STMicroelectronics points out that the drawn gate length on Intel's ˜22nm" process is actually 26nm.
Furthermore Intel's triangular fins, which degrade the advantages of finfet processing could underperform GF's rectangular fins which optimise the finfet advantage.
At the front of the GF 14nm finfet node will be mobile SOCs says Chian. GF has been working with ARM since 2009 to optimise its processes for ARM-based SOCs.
At TSMC the first tape-out on its 16nm finfet process is expected at the end of next year. That test chip will be based on ARM's 64-bit V8 processor.
Using an ARM processor to validate its 16-nm finfet process should give TSMC's ARM-based SOC customers great confidence.
Asked about the effects of finfets on ARM-based SOCs, East replies: "There'ss no rocket science in what you get out of it. The question is does it deliver the benefits at an acceptable cost? You don't get something for nothing. How much does it cost to manufacture? How good is the yield? And that, of course, affects cost."
And so on goes Intel beating its head against the wall to get into the low-margin mobile business.
Recently Intel said it expected its Q4 gross margin to drop 6% from Q3's 63% to 57%. Shock, horror said the analysts
But if Intel succeeds in the mobile business, its gross margin will drop a lot more than that.
The drop in Q4 is solely due to under capacity. Nvidia claims over 50% gross margin on a Tegra 3 chip that has 4 cores, a 12-core gpu and is priced at 20 something dollars. Gross margins won't be radically different for Atom over Core as the die size will be smaller. Even if gross margins dropped a few per cent if you double/triple your sales volume wouldn't that be a good tradeoff ?
Exactly right. Mobile volume is way too big to compensate any 'imaginable' gross margin drop.
Remember, All these ARM based processor makers are living nice and well with ARM processor.
The question becomes what if Intel can do the same thing but their own designs and process engineering. The margins will be much higher and sales will be even more higher with the volume of these mobile chips....will be sold like potato fries.