According to a report from DigiTimes, it looks like TSMC’s 3nm wafers will be super expensive and will affect next-generation CPU and GPU prices. The report says that TSMC will significantly increase the price of its 3nm wafers due to its dominant position in chip manufacturing and the fact that there is no competition yet in the 3nm process space.
A chart of TSMC’s wafer pricing shows that the price jump from 7nm ($10,000) to 5nm ($16,000) wafers is about 60%. Now with 3nm, TSMC’s wafer unit prices are expected to exceed $20,000, which will mean we’re bound to get more expensive next-generation CPU and GPU products.
TSMC’s 3nm wafer pricing is rumored to hit the $20,000 mark, leading to increased costs for next-generation Intel, AMD and NVIDIA CPUs/GPUs. (Image source: DigiTimes)
Currently, AMD and NVIDIA are some of TSMC’s major customers, along with Apple and others. NVIDIA has increased the price of its graphics cards for each market segment. the RTX 4090 is priced 10-15% higher than the RTX 3090 and the RTX 4080 is priced over 50% higher than the RTX 3080. This comes after NVIDIA’s CEO Jen-Hsun Huang also visited Taiwan to discuss with TSMC’s CEO about getting early access to 3nm wafers for their next-generation GPU lineup.
AMD has been able to offset prices by mixing and matching different nodes on its chip offerings. the Ryzen, Radeon and EPYC families utilize both 5nm and 6nm technologies and chips to help reduce the overall costs associated with a single die. Going forward, Intel will also leverage TSMC’s N5 and N3 process nodes to develop Meteor Lake and Arrow Lake tGPU IPs.
However, this dominant situation will also cause the price of each generation of the foundry to rise sharply without any resistance. As production costs rise, the chip industry will inevitably pass them on to downstream customers and consumers, and the prices of new-end products will no longer come back down.
Nvidia CEO Jen-Hsun Huang said bluntly that despite limited performance gains, the increase in new products is justified because the price of 12-inch foundry wafers has increased significantly compared to the past, rather than just being a little more expensive.
But this reliance on TSMC means that the semiconductor manufacturing company will continue to be in a dominant position to offer higher prices for its technological advantage over other companies. Rival Samsung has also said they will start mass production of their own 3nm (GAP) node by 2024, but things are not looking good as yields are less than 20% and there are still many issues to be resolved with Samsung’s next-generation node. All of this means that chip prices will continue to move higher on the cost side, and unless there is another competitor at the same level as TSMC, we can’t expect this pattern to be broken.
Intel has said that allowing chipmakers such as Nvidia and AMD to produce their products in their soon-to-be-built factories is one of their goals, and the new rising force under this old chipmaker is also worth watching.