Samsung begins mass production of most advanced chip technology to date

Samsung Electronics has become the first chipmaker in the world to mass-produce advanced 3-nanometer (nm) microchips, which are said to be smaller, as well as more powerful and efficient than currently used 5nm semiconductors.

The announcement is a key milestone in Samsung’s efforts to compete with Taiwan Semiconductor Manufacturing Company (TSMC), which dominates the market for contract chip production and is the manufacturer of Apple’s chips for its iPhones, iPads, MacBooks and Macs.

TSMC is set to begin volume production of 3nm chips in the second half of 2022, and the company entered the development stage of 2nm technology last year, according to the TSMC’s 2021 annual report.

Samsung’s 3nm chips are expected to be used in “high-performance, low-power computing” applications before being put into gadgets such as mobile phones.

“Compared to the 5nm process, the first-generation 3nm process can reduce power consumption by up to 45 per cent, improve performance by 23 per cent and reduce area by 16 per cent,” Samsung said in a statement.

Samsung’s 3nm chips use its gate-all-around (GAA) transistor architecture, called Multi-Bridge-Channel FET, which packs wider channels in gates for electricity to flow through while reducing the voltage level compared to the previous FinFET transistor architecture. By using all four sides of the channels, the company is able to allow more drive current to pass through the gates compared to FinFET, which only uses three sides.

A follow-up second-generation 3nm chip model is also currently in the works with improved power usage, performance and surface area, according to Samsung.

The vast majority of the world’s most advanced microchips are made by Samsung and TSMC. Although Samsung is the market leader in memory chips, the company has been struggling to catch up with TSMC in the advanced foundry business in recent years.

At the moment, TSMC holds over half of the global foundry market share, while Samsung accounts for 16 per cent of the market share.

Currently, both chipmakers are running their foundries at full capacity to address the global semiconductor shortage brought forth by pandemic-related disruptions and the ongoing trade war between the US and China. The shortage has had the most effect on certain auto production lines, with Ford and Jaguar Land Rover shutting factories and laying off workers while other automakers choose to leave out higher-end features such as integrated navigation systems in order to adapt to the shortage. 

Earlier this year, US Commerce Secretary Gina Raimondo warned that the global semiconductor crisis shows no signs of slowing down, and is likely to last through 2023 and perhaps longer. 

Despite Samsung’s 3nm announcement, Bloomberg reports that the South Korean conglomerate is unlikely to be able to make inroads against TSMC’s market share until it can prove that the cost-efficiency of its new 3nm process is competitive with the market leader.

The new 3nm chips will be manufactured in South Korea for now, initially at its Hwaseong facilities before expanding to Pyeongtaek, according to Bloomberg, but the company’s planned £14bn chip plant in Texas might eventually have the capacity to produce these types of microchips. However, the Texas plant is not expected to start production earlier than 2024.

Last month, the company announced a five-year plan to invest 450tn won (£294bn) in what it calls “strategic businesses”, which are expected to include semiconductors.