NVIDIA GPU Demand: TSMC vs Samsung
According to a recent report by Business Korea, there is a high demand for NVIDIA's Graphics Processing Units (GPUs) worldwide. However, due to limited supply, the prices of GPUs have skyrocketed. GPUs are crucial components used in the development of artificial intelligence (AI) programs like ChatGPT. In fact, NVIDIA currently dominates over 90% of the global AI GPU market.
The rapid growth of the AI industry has fueled the demand for NVIDIA GPUs in recent years. Unfortunately, the supply has not been able to keep up with this increasing demand. To address this issue, NVIDIA has outsourced the production of their flagship A100 and H100 GPUs, which are well-known for their use in ChatGPT, to TSMC (Taiwan Semiconductor Manufacturing Company). Recognizing the urgency, TSMC has made the decision to expand their packaging capacity as requested by NVIDIA.
TSMC's packaging technology, known as CoWoS, plays a vital role in enabling the production of advanced AI chips. This technology is essential because it facilitates the efficient processing of large amounts of data, a challenging task in the field of AI. The packaging process involves stacking chips in a three-dimensional manner within a thin film, reducing the distance between them. This results in faster connections between the chips, leading to significant performance improvements of up to 50% or more. It is worth noting that the choice of packaging technique has a significant impact on chip performance.
TSMC has been at the forefront of packaging technology, introducing CoWoS in 2012 and continuously improving its packaging capabilities. With the emergence of heterogeneous integration, a new technology that combines different types of semiconductors, such as memory and system semiconductors, TSMC's packaging expertise has become even more crucial. Companies like NVIDIA, Apple, and AMD heavily rely on TSMC and its packaging technology to produce their core products effectively.
As a result, TSMC has become the go-to manufacturer for AI contract factories in the distribution of electronic components, gradually widening the gap between them and Samsung in terms of market share. TSMC's commitment to this field is further demonstrated by the recent opening of Fab 6, a semiconductor production factory specializing in high-end packaging. This move clearly indicates TSMC's intention to compete directly with Samsung in the market.
In response to TSMC's progress, Samsung is also investing in advanced packaging technology to enhance chip performance. During the Samsung Foundry Forum 2023, they announced their comprehensive packaging strategy, aiming not only to advance packaging technology but also to strengthen the overall ecosystem. Samsung's vision includes offering a one-stop packaging service and creating a dedicated production line specifically for packaging, catering to customers who seek customized packaging solutions to boost chip performance.
To outperform TSMC's CoWoS technology, Samsung is actively developing more advanced packaging concepts such as I-cube and X-cube. Their focus lies particularly in three-dimensional (3D) packaging, where multiple chips are stacked vertically to achieve superior performance. An industry insider predicts that Samsung and TSMC will soon engage in direct competition in the packaging domain, with Samsung presenting an innovative three-dimensional packaging solution.
In summary, the high demand for NVIDIA's GPUs in the electronic components industry has resulted in supply shortages and increased prices. TSMC's CoWoS packaging technology has played a pivotal role in meeting this demand, enabling the production of advanced AI chips. Samsung, on the other hand, is striving to develop its own cutting-edge packaging techniques to rival TSMC. This competition between two industry giants is expected to drive further advancements in the field of semiconductor packaging.
