New Intel contract foundry set to compete against TSMC, Samsung

Two months into his tenure as CEO of Intel, Pat Gelsinger has devised a plan to bring back Intel into the fight for chipmaker supremacy. The masterplan, called IDM 2.0, includes a $20 billion USD investment that will see the creation of an Intel contract foundry meant rival other outsourced chipmakers such as TSMC, Samsung and Global Foundries.

According to an Intel press release, the construction of the fabrication labs in Intel’s Ocotillo campus will lead to the creation of more than 3000 high-wage jobs for permanent high-tech fields, 15,000 local long-term jobs and more than 3,000 jobs for construction. In addition, the said contract foundry will also be partnering with Biden’s administration and State of Arizona for incentives to spur domestic investment.

Taiwan Semiconductor Manufacturing Company (TSMC) is perhaps Intel’s greatest rival in the outsourced chip manufacturing industry. TSMC currently manufactures chips for companies such as Apple, AMD, NVIDIA and even Intel.

TSMC’s notable production of AMD’s 7-nanometer (nm) processors has placed both companies in a huge advantage with AMD inching away from Intel after impressive benchmarks for both CPU and more recently GPUs which are wildly sought after in the community.

Apart from the investment into the fabrication labs, Intel also aims to revitalize its presence online and in the industry, Intel is also set to launch Intel On, which will be the company’s Industry event series which is reportedly launching in October at San Francisco.

As for the plans laid out under the IDM 2.0, Pat Gelsinger is confident of Intel’s ability to make a turnaround within the coming year.

“Intel is back,” stated Gelsinger. “The old Intel is now the new Intel.”

Intel’s contract foundry could give the company the edge it needs to regain the ground it has lost to competitors in recent years. In light of the current global chip shortage, it could even help the company become a rival to established outsourced chipmakers such as TSMC and Samsung.

In addition to its new contract foundry, IDM 2.0 also highlights Intel’s progress in its development of a 7nm chip that aims to combat AMD’s 7nm Ryzen 5000-series chips. (Read: AMD reveals Zen 3 Ryzen 5000 CPU lineup, will launch in November)

Over the previous year, Intel’s 10nm chips have seen struggled to match AMD’s 3000-series chips. According to former Intel CEO Bob Swan, this was due to bad timing and over-ambition.

Intel’s 7nm chips, codenamed “Meteor Lake,” are expected to undergo tape-in or SOC (System-on-chip) design integration starting Q2 of 2021 and are expected to be available on the market by 2023. Another part of Intel’s lineup is the Ponte Vecchio, the company’s first high-end server GPU which is said to achieve petaflop performance and is currently used on exascale computing.

Exciting times are definitely ahead for Intel under Pat Gelsingers’s leadership. The IDM 2.0 and so with other product developments have already buoyed investor confidence with Intel stocks as of last week rising by more than 6%.

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