As expected, Taiwan Semiconductor Manufacturing Company cannot meet demand for chips produced using 28nm process technologies due to low yields and insufficient production capacities, a media report citing industry source claims. The shortages are projected to ease only by the end of Q3 2012.

TSMC's customers who utilize 28nm process technology - Advanced Micro Devices, Nvidia Corp. and Qualcomm - have all faced shortages of 28nm chips. AMD has announced a number of 28nm graphics processing units so far, but their availability is not truly wide; Nvidia has also managed to introduce a number of 28nm GPUs, but blamed TSMC for undersupplies; Qualcomm is also frustrated with tight supply of its chips that TSMC produces using 28nm fabrication process.

The tight supply of chips made at TSMC utilizing 28nm technology is a result of both relatively low yields (which are gradually improving) and TSMC's reluctance to quickly boost manufacturing capacities "in order to maintain gross margins", reports DigiTimes web-site.

In Q4 2011, 28 process technology accounted for 2% of total wafer revenues. In Q1 2012 TSMC expects wafers processed using 28nm process technologies to account for 5% of revenue. The world's largest contract maker of semiconductors said it expected 28nm ramp to be fast and projected that the process technology will contribute to more than 10% of total wafer revenue this year. According to unofficial sources, the shortage of 28nm manufacturing capacities will get lower at the end of the third quarter of 2012.

TSMC has so far completed 36 individual tape-outs and have scheduled another 132 individual product tape-outs in this year. At present the company produces chips using 28LP (SiON), 28HP (HKMG) and 28HPL (HKMG) versions of the process. The 28HPM flavour entered risk production this quarter and the manufacturer expects to start volume manufacturing of chips using 28HPM in the second half of 2012.

Tags: TSMC, Semiconductor, 28nm, Qualcomm, AMD, Nvidia