Intel to make 14-nm FPGAs for Altera

2/26/2013 1:20 AM EST

Interesting! So Intel is going into full fledged foundry business. Get the high end customers first and then aim for mid end and leave the low end for others. TSMC/GF got a thing to worry.

2/26/2013 3:03 AM EST

It sounds a little step foreward for Intel. The tipping point comes when Intel gets foundry orders from Apple, Qualcomm or Nvidia. Let's wait and see then.

2/26/2013 8:05 AM EST

So, first Achronix, then Altera!

2/26/2013 9:08 AM EST

DUV immersion lithography is really impressive.

2/26/2013 9:53 AM EST

New partners. New competitors. Now, Altera needs to work with competitors ARM & Intel as well as competitors TSMC and Intel... Its going to be interesting.

2/26/2013 10:10 AM EST

This quote just added to the story:

"It is not Intel's objective to become a general foundry service provider," said Len Jelinek, a chief analyst at IHS iSuppli. Rather it aims "to select a few high volume [foundry] clients [that] provide Intel with an additional revenue stream to help defer the cost of its advanced manufacturing capability," he said.

2/26/2013 11:54 AM EST

In a world dominated increasingly by ARM based designs at the expense of X86, device & mfg are Intel's remaining strengths. But to stay ahead of the pack and generate enough revenue for R&D and next gen Fabs, Intel needs volume. Otherwise TSMC will soon catch up.

To maintain R&D & process lead Intel must not only generate enough revenue of its own but also deny TSMC and Samsung the tech creds and huge revenues they have been making from Foundry service. Even though demand for Mobile chips is expected to grow at 30+ %, when it comes to tech creds. and markup ( ASP ) it is still a zero sum game. Just look at TSMC vs older UMC at 28 nm.

As Intel's cash cow PC business begins to stagnate in spite of their best design / marketing effort, they need to find new volume, FPGAs and network processors ain't gonna do it. Mobile is the obvious answer.

Pushing own high end designs ( but with 32 nm transistors - no better than Foundries ! ) as a continuation of the top dog mentality ( a byproduct of the x86 monopoly ) has bombed.

Instead Intel should accept reality and implement a nuanced strategy to grow its Mobile business, but still leveraging their lead in process / mfg. tech :

1. Commit to QC and AAPL no competition in leading edge chips for Mobile ( what does US anti-trust laws have to say about that ? any exceptions during the Great Recession ? )

2. Offer these large Fabless co.s Foundry service from Intel's upcoming 20,14 nm Fabs( 2 nodes, well ahead of TSMC / Samsung ).

3. develop its own non ARM architecture & processor / baseband chips ( like MediaTek ) for low end Smartphones & Tablets ( perhaps cheap Windows Phablets to replace Laptops ) aimed at emerging markets but still using its leading node ( 20 nm ) Fabs & therefore lower power ( compared to TSMC or Samsung )

2/26/2013 12:32 PM EST

Here's the reason for ALTR's move - quote from yesterday when ALTR presented @ Morgan Stanley Tech conference.
Intel has die size advantage because it seems very difficult to scale the backend/interconnect.
Also FPGA are early adopters of bleeding edge - it's a blow to TSMC

Well, the most obvious reason is it's, obviously, a smaller nanometer, 14 versus 20, even though 16 is called, 16 FF, it's actually 20 nanometers. But the real key, as you get to these smaller and smaller geometries, is the need for essentially FinFET or technology that prevents transistors from arcing. And Intel's had that technology at 22 and obviously, we'll have that at 14, and it becomes increasingly important as you move down the nodes and that's the biggest reason. TSMC will have it. We feel that this was a -- those of you that talked to me before, you know that we do a constant evaluation of foundry capability, weighing a number of factors, been really open about that and at this point, we just decided this made the most sense. Keep in mind TSMC still is building all of our products and so they're still a very, very important partner to us

2/26/2013 12:55 PM EST

This is a very dangerous time for Intel. They have had a very good run with x86, but this market is flattening. Intel has huge overhead costs for design and manufacturing, they depend on the growth of x86 to sustain their business model. The fact that Intel is pursuing foundry deals is an admission that they cannot fill their cutting edge fabs with x86, not to mention their older fabs. Intel needs to find a new business model or accept a future where there is a potential death spiral of declining profits, declining technology investiment, and declining leadership in process technology.

2/26/2013 1:36 PM EST

Where will they make the 14nm? Ireland, D1X, Fab 42?

2/26/2013 2:38 PM EST

This is huge gambling to Altera since there is no tracking record at Intel that it could deliver a foundry service to outsider. Cost & IP availability will be another major concern to Altera as well.

2/26/2013 3:34 PM EST

Altera told Taiwan foundry "still committed 95% of its volume going forward" . Just one product on next generation Intel 14FF.

However, this does mean Altera has no interested in Taiwan foundry finfet going forward (16FF or 10FF). Move driven since early test chips on Taiwan foundry 16FF were not promising for speed or power(16FF worse than current FPGA 28HP).

2/27/2013 9:20 AM EST

Would this be one of the business negotiation, marketing, and investor/stakeholder PR tactics?

2/27/2013 12:19 PM EST

It makes sense for Intel and Altera.

As you move into progressively smaller geometries, fewer foundries qualify. Altera wants to move to 14nm for new products. Who else *can* make them?

But as you move down into that range, the cost of building a fab rises into the ionosphere. Very few companies can afford to build them at all, and those that can want to be sure a substantial market is there for what the fabs will make.

The deal with Altera provides Intel with a chunk of revenue to help offset the design and construction costs of 14nm geometries, and Altera is not a direct competitor to Intel. The question is what Altera has in the pipeline that it might ask Intel to manufacture for them.

Intel is essentially in two businesses, design and manufacture. Competitors like ARM are in one: design. Intel has historically designed what it made, but as growth in the X86 market flattens, the question arises of what business will keep those oh so expensive foundries operating at capacity.

"It is not Intel's objective to become a general foundry service provider," sounds quite true, but they also need to keep the fabs turning out product and generating revenue 24/7 to justify having them. Juart filling in the corners and mopping up any idle capacity will be attractive.

I'm just wondering how firm Intel's insistence that while it *has* an ARM license, it doesn't intend to *use* it will remain. Intel *used* to make ARM CPUs via its former StrongARM division. If someone like Apple inquired about Intel making ARM CPUs at 14nm geometries for them, what do you suppose Intel might say? I can see the design side of the house turning colors and sputtering, and the manufacturing side calling the janitors to mop up the drool.

2/27/2013 12:59 PM EST

Whats to prevent Intel from been the best ARM isa
cpu design and manufacturing co.

2/27/2013 1:12 PM EST

Altera is behind technically compared to Xilinx in 20nm and trying to use process technology to leapfrog Xilinx. It is not difficult to see why they are doing this.

2/27/2013 1:51 PM EST

t

2/27/2013 1:52 PM EST

The article does not state if the deal with Altera is exclusive or not. Assuming that it is not exclusive, expect Xilinx to do the same very soon. They will be crazy not to! But if the deal is exclusive, then this changes the rules of the game for the FPGA industry, with profound implications in about three to five years.

2/27/2013 2:13 PM EST

cool cooments

h

2/27/2013 2:25 PM EST

Does Intel have an ARM arch license for all ARM architectures? I through it was only for the older instruction sets. That being said, do you need ARM's permission to FAB parts for another company who has bought the ARM cores?
I don't see how you can make any dent in volume products without making chips with ARM cores in there. Anything else would not be considered a high volume device. My guess is that Intel is just testing the waters with foundry flow business model.

4/3/2013 1:06 PM EDT

Altera's a bit crazy to do this, there's not even any 14 nm published data yet, even from Intel.

5/2/2013 8:59 AM EDT

Altera has no good options. Altera is loosing leading edge to Xilinx at 28nm

5/2/2013 6:19 PM EDT

Intel also missing an interposer strategy here.