Ivy Bridge Launch Shows Intel's Manufacturing Advantage
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Intel's release of its new 22-nanometer Ivy Bridge chips and the aggressive ramp schedule the company has set for the technology illustrates the advantages Intel has in being both a processor designer and manufacturer, according to executives and analysts.
Intel still spends billions to build its chip-making facilities--or fabs-- at a time when more competitors are relying on third-party commodity manufacturers as a way to cut costs. Smaller rival Advanced Micro Devices is the highest-profile chip vendor to make such a move, spinning off its manufacturing business in 2009 to create Globalfoundries, an independent chip manufacturer.
But according to Intel executives, keeping the manufacturing in-house has enabled Intel to not only reap the financial benefits of being both the designer and maker of the products, but also to quickly accelerate the ramp of chips with such cutting-edge technologies as the three-dimensional Tri-Gate transistor architecture, something rivals will be unable to duplicate for at least two years, they said.
The combination is what Intel calls Integrated Device Manufacturing, and the advantage can be seen with the Tri-Gate architecture, as well as the development of the company's low-power Atom platform, according to Intel President and CEO Paul Otellini.
The move to Tri-Gate Transistors delivers roughly twice the improvement in transistor performance over conventional planar scaling when applied to low-power applications like smartphones and Ultrabooks, Otellini said during a conference call April 17 with analyst and journalists to discuss Intel's first-quarter financial numbers. "We combine our process technology, manufacturing and design to produce a highly leveraged business model that is becoming increasingly rare in our industry. That model allows us to do things others can't, like advancing our Atom road map at twice the rate of Moore's Law through 2014."
Such technology developments are becoming more difficult to pull off, and Intel's manufacturing capabilities give it a key advantage over rivals, he said.
"Our research on 3D transistors began over 10 years ago, and advancements like this don't come easily," Otellini said. "In fact, they're getting harder and harder to achieve, and our lead over the rest of the industry continues to grow, giving us product advantages in power, performance and cost."
Intel executives expect Ivy Bridge to be the fastest ramp ever of an Intel product, and will make up 25 percent of chip shipments this quarter and half of all shipments by the fall. This comes at a time when other chip makers are dealing with supply issues from their third-party manufacturing partners. AMD took at hit in the third quarter of 2011 when issues at Globalfoundries limited supplies of 32nm Llano chips. More recently, Qualcomm executives noted supply problems from Taiwan Semiconductor Manufacturing Co. (TSMC) of 28nm mobile chips.