The 5nm and 3nm chips by TSMC are maxed out. What happens next? (Photo by Sam Yeh / AFP)
- The Taiwanese giant’s 5nm chip production facilities are running at full capacity while 3nm orders are booked.
- It’s almost impossible for TSMC to undertake any further orders, as it was reportedly forced to give priority to lucrative clients like Apple thanks to the chip shortage.
- Experts reckon Samsung would be viewed as the second-best option.
Semiconductor foundry Taiwan Semiconductor Manufacturing Company (TSMC) has become the most valuable publicly traded company in Asia, topping tech conglomerate Tencent. Unfortunately, the ongoing chips shortage has caused the Taiwanese giant to have its hands full running its 5nm production facilities at maximum capacity for various clients.
TSMC’s advanced manufacturing nodes are the reason why it is the most sought-out semiconductor company in the world especially amid a global chip drought. In fact, a new report also claims that its 3nm orders have been completely booked. The fact that TSMC is running at full capacity on some of its most in-demand nodes shouldn’t surprise anyone given the ongoing silicon shortage.
What happens when TSMC is maxed out?
With the company’s fabrication facilities running at full tilt, companies such as Qualcomm have had to turn to Samsung to produce its latest Snapdragon chips, which further strains Samsung’s fabrication capacity.
According to Wccftech, Apple has contracted TSMC to use its N5P node to produce its A15 Bionic chip that will power the upcoming iPhone 13.
Apparently, Apple has placed an order for up to 100 million ‘Bionic’ chips from TSMC, so, considering the ongoing semiconductor shortage, that doesn’t leave much capacity for the incredibly high demand for silicon across pretty much every sector.
It was already next to impossible for TSMC to undertake any further orders, as it was reportedly forced to give priority to lucrative clients like Apple thanks to the chip shortage. Unless companies have money like Apple, this is bad news for some organizations. Even bigger names like AMD and Nvidia are going to have to fight harder to get the semiconductors they need to power their CPUs and GPUs.
Apparently, Apple will also take advantage of TSMC’s 4nm node to be used in future products, and it has already been reported that the California-based giant has secured the initial shipments for this next-generation manufacturing process.
Qualcomm may switch to TSMC’s 4nm technology for the Snapdragon 898 Plus in late 2022, but only if TSMC has room to accommodate such orders. There was also a possibility that the Taiwanese firm would be involved in making chips for Google’s Tensor, but it looks like all that responsibility has fallen on Samsung’s shoulders.
Inevitably, Samsung would be viewed as the second-best option, with experts claiming that the Korean firm’s technology is inferior to TSMC’s. But unless the chip shortage does not subside, other clients like Qualcomm, which is using Samsung to manufacture the Snapdragon 888 SoC, might have no opportunity to book orders with TSMC.
Dashveenjit Kaur | 
@DashveenjitK
Dashveen writes for Tech Wire Asia and TechHQ, providing research-based commentary on the exciting world of technology in business. Previously, she reported on the ground of Malaysia's fast-paced political arena and stock market.
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