Intel-TSMC tie-up targets Atom chip

Updated at 10:50 a.m. PST with additional information from announcement and Intel-TSMC conference call.

Intel and Taiwan Semiconductor Manufacturing Co. will collaborate on Atom chip production, the companies announced Monday.

For its part, Intel is eying big markets--such as smartphones--where it is currently not a player, but TSMC is. "Many of our customers already had an existing IP (Intellectual Property) infrastructure on TSMC that they would like to take advantage of as they ramp Atom-based products. That's essentially what the agreement is about," said Anand Chandrashekar, senior vice president at Intel, speaking Monday morning in a joint Intel-TSMC conference call. Atom is currently the most widely used processor in Netbooks.

Chips are targeted at end products such as handhelds, Netbooks, and consumer electronics, Chandrashekar said.

"(It's about) enabling Atom on TSMC (and) enabling TSMC to go after these new market segments as well as Intel going after these market segments together," Chandrashekar said.

Under the agreement, Intel would port its Atom processor CPU cores to the TSMC technology platform including processes, IP, libraries, and design flows. TSMC, however, will not market Atom chips as a TSMC product. It will serve solely as a manufacturer of Atom-related silicon, company executives said Monday. All products that emerge from the collaboration will be Intel-branded products.

Collaborating with another manufacturer on chip production is an unusual move for Intel, which prides itself on doing chip manufacturing in-house. It is not unprecedented, however, as Intel has consigned production of select silicon to outside manufacturers in the past. TSMC is the largest contract chip manufacturer in the world.

The upcoming Atom processor code-named Moorestown--due late this year or early next year--will be a system on a chip (SOC) that combines the processor, graphics, memory controller, and video encode/decode into a single chip package. An accompanying chip will provide functions such as wireless, storage, and I/O (input/output).

TSMC already makes SOCs for companies such as Qualcomm and Texas Instruments.

Intel's goal is to get its x86 architecture-based Moorestown SOCs into future cell phones. The chipmaker recently announced a deal with LG Electronics whereby LG will use Intel's Moorestown processor in upcoming smartphones.

The challenge for Intel will be matching the energy frugality of silicon from longtime cell phone silicon suppliers like Qualcomm and Texas Instruments. Toshiba recently disclosed that it is using Qualcomm's Snapdragon chip in a forthcoming phone, and Qualcomm supplied the main processor in the first phone using Google's Android OS.

[slickuser]

Great move!

ARM! Here I come! Watch your a@#!

[probell]

By being a pure IP company ARM has an advantage over Intel in promoting its architecture. ARM does not compete as a chip vendor. Since Intel is primarily a chip vendor and a fearsome competitor other chip makers are unlikely to choose x86 over ARM for their processor architecture. As a result, Intel will remain one of very few chip vendors selling x86 based chips while most of the rest of chip makers use ARM. I expect the Intel-TSMC partnership to have little effect on the dominance of the ARM architecture in consumer electronics.