Tech giants form tiny chip group
Seven of the world's leading chip makers are collaborating on chips which contain transistors with features just 32 billionths of a metre wide. — IBM, Toshiba, AMD, Samsung, Chartered, Infineon and Freescale have formed the alliance to cut development costs.
Context & Ripple Effects
The 32-nanometer node is where transistor scaling stops being affordable for any single firm, and this seven-way alliance — IBM, Toshiba, AMD, Samsung, Chartered, Infineon and Freescale — is a cost-sharing answer to that. For AMD it lands at a particularly exposed moment: the company has just taken Mubadala's $622 million investment with no visible turnaround in its chip business, cancelled its Quad FX enthusiast platform after Intel's single-socket quad-core parts outperformed it at lower power, and struck a subdued tone at its Financial Analyst Day earlier in December.
IBM brings the research heft to the group — days before the announcement it detailed an optical interconnect chip that moves data between processor cores up to one hundred times faster than electrical links, work it says could shrink supercomputers toward laptop size. Pooling that process research across seven firms lets mid-sized players like Chartered and Freescale reach 32nm without funding a solo roadmap.
First-order effects
- AMD gains a path to leading-edge 32nm manufacturing it could not fund alone while its finances are strained, effectively outsourcing part of its process roadmap to the IBM-led group.
- Chartered, Infineon and Freescale get shared access to 32nm development, converting a fixed R&D burden they would each have carried separately into a split cost.
Second-order effects
- Intel now competes against a coalition rather than individual firms at the next node, raising the bar for its own 32nm rollout to justify its go-it-alone spending premium.
- Equipment and materials suppliers face consolidated purchasing power: one joint 32nm program standardizes tooling choices across seven fabs instead of seven separate ones.
Third-order effects
- If each successive node keeps getting more expensive, pre-competitive development alliances become the default industry structure, with process technology converging on a few shared platforms rather than proprietary per-company roadmaps.
- Firms that stay outside such consortia risk being priced out of the leading edge entirely, accelerating a split between alliance members and second-tier manufacturers.
The trend: As development costs per process node climb, chipmaking is shifting from solo roadmaps toward pooled R&D alliances in which access to the leading edge depends on membership.