After GlobalFoundries had left the “depleting market” at the beginning of the year, there were only three large companies left that could fight on a large scale. TSMC is the largest manufacturing company, Samsung is also at the forefront, but has difficulty winning customers loyalty, and Intel’s Custom Foundry business has not been very successful either. The news is now getting around that Intel could stop manufacturing chips on a contract basis, i.e. for other customers.
Intel could stop manufacturing chips on a contract basis, i.e. for other customers
DigiTimes quoted sources in Taiwan’s chip manufacturing industry saying that they would not be surprised if Intel left this market. The “Intel Custom Foundry” unit, established eight years ago, is expected to charge higher prices than its competitors and has no major customers or orders. There was some interest in Intel’s 10nm node, but we all know how it ended up with many delays.
Taiwan’s semiconductor companies are not surprised by Intel’s possible move to abandon the contract chip market, a market in which the American company has never really shown its commitment, sources said. It entered the market in 2010, but never managed to stand out or win important customers.
The sources also gave some reasons why Intel Custom Foundry did not achieve its goal. First, TSMC alone has achieved a market share of over 50%, and other leading manufacturers such as Samsung and GlobalFoundries have worked hard to consolidate their positions. Intel’s relatively higher manufacturing costs and weak supply chain support compared to TSMC and Samsung are other reasons.