Intel Declares ‘Chip War’ on TSMC, Others with Foundry
SAN JOSE, Calif. – Intel said a chip war is about to begin with TSMC.
Not only is the IT world entering into a new era deemed The Age of AI, but it also is moving into yet another phase of hardware competition modeled on Intel vs. Motorola (1970s) and Intel vs. AMD (1990s) in years gone by.
TSMC (Taiwan Semiconductor Manufacturing Company) is by far the world’s largest and richest processor maker for other enterprises, owning a whopping 60 percent of the global market revenue. However, Intel sees an opportunity to earn a substantial stake in this market.
Intel, which has designed and produced its own integrated processors for about 50 years but has not made them for other labels, is a decided underdog in the coming conflict. It’s only now venturing onto the new battlefield following three years of prep, which happens to be the same time window mirroring the appointment of CEO Pat Gelsinger on Feb. 15, 2021.
On Feb. 21 the venerable company launched an entirely new entity, Intel Foundry, and pitched it as a “sustainable systems foundry business” designed for the AI era. Built to be a standalone business, the Foundry will design and produce processors for anybody who asks (and has the financial backing); this includes internal Intel projects in addition to those for external customers.
Intel Foundry unveiled a new roadmap featuring Intel 14A process technology, specialized node evolutions and new Intel Foundry Advanced System Assembly and Test (ASAT) capabilities to help IT managers fulfill their AI plans.
Aiming at Being No. 2, for Starters
Gelsinger wants his company to rise to No. 2 in the world in this business by 2030. A noble goal, to be sure; executing the plan will be a considerable task.
Intel’s revenue in 2023 was $54.23 billion from its longtime businesses. TSMC’s estimated revenue for 2023 was $69.3 billion. Samsung’s chip fabrication business was No. 2 with 2023 revenue of $39.9 billion, so Intel has a steep hill to climb in starting from zero in a new business.
But Gelsinger, ever the optimist, told reporters and analysts in a Q&A session at the Intel Foundry Direct Connect event here that the demand for these next-gen processors is insatiable, so the future is bright.
“Everybody believes that the next-generation AI models will be bigger by orders of magnitude,” Gelsinger said. “The demand we’re seeing is leading us to some very large numbers (of processors) for these GenAI training systems. What’s even more interesting is the inferencing that goes behind it all to make GenAI available to every enterprise, every edge, and so on. That’s why we say ‘AI Everywhere.'”
Gelsinger foresees dozens of Intel chip fabrication plants pouring out AI chips in locations all over the world by the end of the decade. He’s starting with a new facility currently being constructed near Columbus, Ohio.
“I think TSMC is a great company, and we are going to build a great foundry as well. And we’re going to challenge each other to further greatness,” Gelsinger said. “They are the best company in terms of customer support, bar none, in the industry. But they do not have a legacy of leadership technologies. They implement other technologies and with great customer support. We have a deep legacy of leadership technologies across domains that we create and drive. I can see a long-term, wonderful future in this business.
“We cannot build these fabs fast enough.”
Intel boldly announced a goal to displace several world chipmakers besides TCSM (namely No. 2 Samsung, GlobalFoundries and United Microelectronics Corp. among them) in its ultimate pursuit of the “world’s-largest processor-maker-by-sales-volume” tag. It’s an aggressive six-year plan.
GenAI a Major Factor in All of This
The emergence of GenAI for use by the world at large is the most powerful propeller behind all of this.
“AI is profoundly transforming the world and how we think about technology and the silicon that powers it,” Gelsinger said. “This is creating an unprecedented opportunity for the world’s most innovative chip designers and for Intel Foundry, the world’s first systems foundry for the AI era.”
Intel will need lots of help to accomplish its lofty goal. Early partners include Synopsys, Cadence, Siemens and Ansys – who outlined their readiness to accelerate Intel Foundry customers’ chip designs with tools, design flows and IP portfolios validated for Intel’s advanced packaging and Intel 18A process technologies. Microsoft already has put in a $1 billion order for new AI chips with Intel, CEO Satya Nadella said at the event.
Among the participants and speakers was U.S. Secretary of Commerce Gina Raimondo, Arm CEO Rene Haas, OpenAI CEO Sam Altman and others.
