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Report: Qualcomm drops Samsung to work with TSMC at 7nm

NinerL

According to a report from Korea, Qualcomm has chosen to work with TSMC instead of its current partner Samsung to produce its next-generation 7nm application processor. Qualcomm has reportedly been designing and developing a 7nm Snapdragon platform using tools distributed by TSMC since H2 2016. This report marks the second major partner loss for Samsung in recent months. Apple, a long running customer, has made the switch to TSMC for the A11 chip for the next iPhone.

 

Qualcomm has been making use of Samsung’s industry leading manufacturing processes for its most recent flagship mobile platforms. Last year’s Snapdragon 820 and 821 were built using Samsung’s 14nm technology, and this year’s Snapdragon 835 flagship uses the company’s cutting edge 10nm process. TSMC has been Qualcomm’s flagship chip partner in the past though, producing the company’s 810 and 808 flagship mobile SoCs in previous generations.

 

The news is clearly a major blow for Samsung, which had been depending more heavily on its semiconductor business lately to offset the ups and downs of the competitive smartphone market. According to market data, Samsung’s foundry business generated around $4.44 billion (5 trillion KRW) in sales last year, $1.78 billion (2 trillion KRW) or 40% of which came of Qualcomm’s application processors. Combined with the loss of Apple’s business, the division is certain to see its financial performance drop sharply in the coming years.

Qualcomm-logo-2-aa-gds-mwc17-1200x800.jp

 

Via http://www.androidauthority.com/qualcomm-drops-samsung-to-work-with-tsmc-at-7nm-779197/

Last month Apple dropped Samsung, and now Qualcomm.  Looks all bad for Samsung, they also can't sell their Exynos SOC'S to other OEM's.

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Poor Samsung... :( 

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Eh, it'll be a hit but it's not like their fabs will go unused. They can ramp up production of their own chips, and I'm sure there will be chips in Qualcomms stack that are based on the 10nm process that will need production orders filled.

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Exynos chips in the galaxy S9?

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57 minutes ago, NinerL said:

they also can't sell their Exynos SOC'S to other OEM's.

Why?

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ƆԀ S₱▓Ɇ▓cs: i7 6ʇɥפᴉƎ00K (4.4ghz), Asus DeLuxe X99A II, GT҉X҉1҉0҉8҉0 Zotac Amp ExTrꍟꎭe),Si6F4Gb D???????r PlatinUm, EVGA G2 Sǝʌǝᘉ5ᙣᙍᖇᓎᙎᗅᖶt, Phanteks Enthoo Primo, 3TB WD Black, 500gb 850 Evo, H100iGeeTeeX, Windows 10, K70 R̸̢̡̭͍͕̱̭̟̩̀̀̃́̃͒̈́̈́͑̑́̆͘͜ͅG̶̦̬͊́B̸͈̝̖͗̈́, G502, HyperX Cloud 2s, Asus MX34. פN∩SW∀S 960 EVO

Just keeping this here as a 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Probably to do with Samsung supporting the FCC's antitrust lawsuit against Qualcomm.

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4 hours ago, NinerL said:

Looks all bad for Samsung, they also can't sell their Exynos SOC'S to other OEM's.

3 hours ago, NinerL said:

Qualcomm owns the patents.

Yeap, pretty much. Qualcomm's licensing practices mean that Qualcomm receive royalties on the sale price of the finished product, not the contribution of the patent.

 

For Samsung, it reportedly it dates back to 1993 when Samsung was manufacturing CDMA chipsets under licenses that it could only manufacture them for their own phones, and has continued since. Fast forward to 2013 and talks to reach an alternative agreement had disintegrated. 

 

By the looks of things this wasn't just a Samsung issue as Apple, Intel, etc joined FCC and the South Korean Regulators lawsuits/investigations around unfair market practices that stifle market competition as it was deemed that their patents fall under standard essential patents. 

 

Basically Qualcomm is being a bigger a**hole than Apple, and it stifling competition and innovation so that they can hold all the cards and monies. 

 

So for instance if Qualcomm charge a 1% royalty, and you sell a $20 modem with a Qualcomm patent to a phone company who then sell the phone for $1000, Qualcomm collect $10 instead of $0.20. 

 

 

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1 hour ago, huilun02 said:

Will Samsung go independent moving forwards? 

they can if they want, they have designed their own ARM processors before, or they could strike an IP deal with one of the other big companies to build a competing processor to the qualcomm stuff.

Grammar and spelling is not indicative of intelligence/knowledge.  Not having the same opinion does not always mean lack of understanding.  

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4 hours ago, mr moose said:

they can if they want, they have designed their own ARM processors before, or they could strike an IP deal with one of the other big companies to build a competing processor to the qualcomm stuff.

The issue is Qualcomm patents and the subsequent agreement they made. They can't do anything till it expires which should be next year.

They can and do already design and manufacture pretty much everything top to bottom which the international Galaxy models are an excellent example of.

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4 hours ago, leadeater said:

Well if AMD Ryzen, TR and EYPC take off in a big way Samsung might have nothing to worry about.

Why would you think that AMD would enter the mobile market, have they said they would do so? I just don't see why AMDs new desktop processors have much to do with Samsungs worries here

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the exynos chips pack a lot of ARM compared to qualcomm however it isnt well optimised for the dual ARM CPU thing (mixing both high and low power cores together), but its one of the reasons why i picked the qualcomm's chip with 2 sets of quad cores rather than their kraits because i get a much better total compute power, only thing is that their 64 bit kraits come with better GPUs.

 

From my experience, qualcomm's own developer hardware using 2 sets of quad cores for ARM is poorly optimised compared to their kraits but you can use both sets of CPUs at the same time. So it only matters for the android OS experience and the rest is dependent on your apps.

 

You dont need to design your own ARM, only the chipset around it. Both apple and qualcomm design their own CPUs though with qualcomm also designing their own GPU for the mobile segment with comparable potential performance (core per core, clock per clock) to nvidia's gpu as well.

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11 minutes ago, Trixanity said:

The issue is Qualcomm patents and the subsequent agreement they made. They can't do anything till it expires which should be next year.

They can and do already design and manufacture pretty much everything top to bottom which the international Galaxy models are an excellent example of.

 

Not to sure how qualcomm patents would stop Samsung from making their own arm processors, they have been doing it for a while now. 

Grammar and spelling is not indicative of intelligence/knowledge.  Not having the same opinion does not always mean lack of understanding.  

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51 minutes ago, mr moose said:

 

Not to sure how qualcomm patents would stop Samsung from making their own arm processors, they have been doing it for a while now. 

they've been making their own chipsets not ARM CPUs. Qualcomm makes kraits, apple makes cyclones, samsung slaps stock ARM chips with their chipsets with a GPU.

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1 hour ago, Rupe said:

Why would you think that AMD would enter the mobile market, have they said they would do so? I just don't see why AMDs new desktop processors have much to do with Samsungs worries here

AMD can use Samsung fabs, this topic is not about the mobile market it is about silicon fabs.

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57 minutes ago, System Error Message said:

they've been making their own chipsets not ARM CPUs. Qualcomm makes kraits, apple makes cyclones, samsung slaps stock ARM chips with their chipsets with a GPU.

I think you will find they all have ARM cores.  I dare say qualcomm have a nice stash of IP for their specific design, but then so would Samsung and apple etc.  Which is why I said earlier that Samsung could just do an IP deal with one of the other companies and keep going.

Grammar and spelling is not indicative of intelligence/knowledge.  Not having the same opinion does not always mean lack of understanding.  

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36 minutes ago, mr moose said:

I think you will find they all have ARM cores.  I dare say qualcomm have a nice stash of IP for their specific design, but then so would Samsung and apple etc.  Which is why I said earlier that Samsung could just do an IP deal with one of the other companies and keep going.

They have ARM compatible cores, not ARM cores, they tweak the core/architecture. 

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5 hours ago, Rupe said:

Why would you think that AMD would enter the mobile market, have they said they would do so? I just don't see why AMDs new desktop processors have much to do with Samsungs worries here

Because Zen/Ryzen/TR/EYPC is using Samsung fab technology licensed to GlobalFoundries and AMD have already indicated they can and are willing to use Samsung fabs,

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6 hours ago, mr moose said:

 

Not to sure how qualcomm patents would stop Samsung from making their own arm processors, they have been doing it for a while now. 

As I said they make everything themselves but they can't sell them. I thought that was clear.

 

They can only use them internally. That's the problem: Samsung wants to sell their product but can't. That may change soon but for now Samsung is sitting on a potential gold mine that's under lock and key.

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8 hours ago, System Error Message said:

They have ARM compatible cores, not ARM cores, they tweak the core/architecture. 

As far as IP is concerned it's the same thing, they still need to obtain a license from arm. 

 

https://www.qualcomm.com/news/onq/2014/08/26/how-arm-architecture-and-snapdragon-processors-are-supporting-64-bit-future

 

EDIT: just in case you didn't read the article, all snapdragon processors have physical ARM cores.

Quote

Snapdragon processors deploy a combination of our custom Qualcomm® Krait™ CPU architecture, alongside the standard ARM-designed CPUs

 

 

3 hours ago, Trixanity said:

As I said they make everything themselves but they can't sell them. I thought that was clear.

 

They can only use them internally. That's the problem: Samsung wants to sell their product but can't. That may change soon but for now Samsung is sitting on a potential gold mine that's under lock and key.

 

Sorry something has been lost in communication here.  I still don't understand how that effects what I said.

Grammar and spelling is not indicative of intelligence/knowledge.  Not having the same opinion does not always mean lack of understanding.  

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44 minutes ago, mr moose said:

Sorry something has been lost in communication here.  I still don't understand how that effects what I said.

You said they could make a deal or license IP from other companies. That wouldn't help them get out of an agreement they have with Qualcomm. Nor do they really lack any IP except some modem patents.

 

Who is holding the industry hostage with modem patents right now? Qualcomm.

 

The point is Qualcomm has Samsung by the balls. There is no way out of that besides waiting for agreements to expire or pay Qualcomm an exorbitant amount of money that could rob Samsung of any profits from their chip business.

 

Well, there is an option 3 which is to wait for the courts to nuke Qualcomm for their business practices.

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16 minutes ago, Trixanity said:

You said they could make a deal or license IP from other companies. That wouldn't help them get out of an agreement they have with Qualcomm. Nor do they really lack any IP except some modem patents.

 

Who is holding the industry hostage with modem patents right now? Qualcomm.

 

The point is Qualcomm has Samsung by the balls. There is no way out of that besides waiting for agreements to expire or pay Qualcomm an exorbitant amount of money that could rob Samsung of any profits from their chip business.

 

Well, there is an option 3 which is to wait for the courts to nuke Qualcomm for their business practices.

That was in response to someone asking if Samsung could become independent moving forwards, which they can.  I only suggested they would need to augment their IP with some from other companies in order for their chips to compete with the snapdragon.

Grammar and spelling is not indicative of intelligence/knowledge.  Not having the same opinion does not always mean lack of understanding.  

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23 hours ago, Belgarathian said:

Basically Qualcomm is being a bigger a**hole than Apple, and it stifling competition and innovation so that they can hold all the cards and monies. 

 

So for instance if Qualcomm charge a 1% royalty, and you sell a $20 modem with a Qualcomm patent to a phone company who then sell the phone for $1000, Qualcomm collect $10 instead of $0.20.

Yea but that also means that more price competative products pay less for the tech, which gets it in to more consumers hands by being more affordable.  So, a royalty angle isn't bad in and of itself. 

To play devils advocate a bit more, there are a few other things to consider.

 

- Are we to believe that samsung and apple entered into this without being aware of it from the start.

 

- I find it unlikely that apple and samsung are actually interested in anything more than increasing their profit margins by reneging and trying to force more favorable costs.  We know damn well they won't pass on savings to consumers so lets not even pretend that thats a thing.  I am sure they'd like us to believe that its a reason and that "trickle down" economics isn't just a slogan.

 

- This sort of arrangement does make it easier for underdogs to innovate and compete.

 

(And no I do not for a moment believe that qualcomm is some sort of benevolent force for the little guy here, just saying)

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