Taipei, Taiwan
CNN
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Within the largest single international funding in US historical past, Taiwan Semiconductor Manufacturing Firm has unveiled a $100 billion investment, drawing world consideration and prompting concern in Taiwan.
TSMC, which produces greater than 90% of the world’s superior semiconductor chips that energy every thing from smartphones and synthetic intelligence (AI) functions to weapons, will construct two new superior packaging services in Arizona, amongst others.
Right here’s every thing it is advisable to find out about superior packaging expertise, which has seen exponential demand progress together with the worldwide AI frenzy, and what which means for the wrestle between the US and China for AI dominance.
Whereas the 2 nations have introduced a brief truce that rolled again disruptive three-digit tariffs for 90 days, the connection remains tense due to ongoing feuding over chip restrictions imposed by the US and other issues.
Final month at Computex, an annual commerce present in Taipei that has been thrust underneath the limelight due to the AI growth, the CEO of chipmaker Nvidia, Jensen Huang, informed reporters that “the significance of superior packaging for AI could be very excessive,” proclaiming that “nobody has pushed superior packaging tougher than me.”
Packaging usually refers to one of many manufacturing processes of semiconductor chips, which suggests sealing a chip inside a protecting casing and mounting it to the motherboard that goes into an digital system.
Superior packaging, particularly, refers to strategies that enable extra chips — reminiscent of graphic processing models (GPU), central processing models (CPU) or excessive bandwidth reminiscence (HBM) — to be positioned nearer collectively, main to higher general efficiency, quicker transmission of knowledge and decrease power consumption.
Consider these chips as completely different departments inside an organization. The nearer these departments are to one another, the simpler it’s, and fewer time it takes, for folks to journey between them and change concepts, and the extra environment friendly the operation turns into.
“You’re attempting to place the chips as shut collectively as doable, and also you’re additionally placing in numerous options to make the connection between the chips very straightforward,” Dan Nystedt, vice chairman of Asia-based non-public funding agency TrioOrient, informed CNN.
In a approach, superior packaging retains afloat Moore’s Legislation, the concept the variety of transistors on microchips would double each two years, as breakthroughs within the chip fabrication course of change into more and more pricey and harder.
Whereas there are various sorts of superior packaging applied sciences, CoWoS, brief for Chips-on-Wafer-on-Substrate and invented by TSMC, is arguably the most effective recognized that was thrown underneath the limelight for the reason that debut of OpenAI’s ChatGPT, which sparked the AI frenzy.
It has even change into a family identify in Taiwan, prompting Lisa Su, CEO of Superior Micro Gadgets (AMD), to say that the island is the “solely place you can say CoWoS and all people would perceive.”
Superior packaging has change into a giant deal within the tech world as a result of it ensures AI functions, which require quite a lot of advanced computing, run with out delays or glitches.
CoWoS is indispensable to producing AI processors, such because the GPUs produced by Nvidia and AMD which are utilized in AI servers or information facilities.
“You might name it the Nvidia packaging course of if you wish to. Virtually anybody making AI chips is utilizing the CoWoS course of,” stated Nystedt.
That’s the reason demand for CoWoS expertise has skyrocketed. Because of this, TSMC is scrambling to ramp up manufacturing capability.
In a go to to Taiwan in January, Huang informed reporters that the quantity of superior packaging capability presently out there was “in all probability 4 instances” what it was lower than two years in the past.
“The expertise of packaging is essential to the way forward for computing,” he stated. “We now must have very sophisticated superior packaging to place many chips collectively into one large chip.”
If superior fabrication is one piece of the puzzle when it comes to chip manufacturing, superior packaging is one other.
Analysts say having each items of that jigsaw in Arizona means the US may have a “one-stop store” for chip manufacturing and a strengthened place for its AI arsenal, benefitting Apple, Nvidia, AMD, Qualcomm and Broadcom, a few of TSMC’s prime purchasers.
“It ensures that the US has an entire provide chain from superior manufacturing to superior packaging, which might profit the US’ competitiveness in AI chips,” Eric Chen, an analyst with market analysis agency Digitimes Analysis, informed CNN.
As a result of superior packaging applied sciences key to AI are presently solely produced in Taiwan, having it in Arizona additionally reduces potential provide chain dangers.
“As an alternative of getting all eggs in a single basket, CoWoS can be in Taiwan and likewise the US, and that makes you are feeling extra secure and safe,” stated Nystedt.
Whereas CoWoS received its second lately, the expertise has really existed for not less than 15 years.
It was the brainchild of a group of engineers led by Chiang Shang-yi, who served two stints at TSMC and retired from the corporate as its co-chief working officer.
Chiang first proposed growing the expertise in 2009 in an try to suit extra transistors into chips and remedy bottlenecks in efficiency.
However when it was developed, few firms took up the expertise due to the excessive value related to it.
“I solely had one buyer … I actually turned a joke (within the firm), and there was a lot stress on me,” he recalled in a 2022 oral historical past venture recorded for the Pc Historical past Museum in Mountain View, California.
However the AI growth turned CoWoS round, making it some of the fashionable applied sciences. “The end result was past our unique expectation,” Chiang stated.
Within the world semiconductor provide chain, firms focusing on packaging and testing providers are known as outsourced semiconductor meeting and take a look at (OSAT) companies.
Along with TSMC, South Korea’s Samsung and America’s Intel, in addition to OSAT companies together with China’s JCET Group, America’s Amkor and Taiwan’s ASE Group and SPIL are all key gamers in superior packaging applied sciences.
