Intel & TSM Outline System-on-Chip MOU (INTC, TSM)

This is getting completely swept under the table because of the stock market flush-out.  But we have been awaiting the announcement confirming last week’s reports of a venture between Intel Corporation (NASDAQ: INTC) and Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE: TSM).  The companies now have agreed  to collaborate on a technology platform, IP infrastructure, and “SoC” solutions (system on a chip).

Intel and TSMC agreed to allow Intel to port its Atom processor CPU cores to the TSMC technology platform including processes, IP, libraries, and design flows.  This collaboration would expand Intel’s Atom SoCs availability for Intel customers, and will be for a wider range of applications through integration with TSMC’s diverse IP infrastructure.

Intel notes that the agreement would significantly broaden the market for its Intel Atom SoCs and accelerate deployment of the architecture through multiple SoC implementations. At the same time, TSMC extends its technology platform to serve the Intel Architecture market segments.

The companies already have an existing collaboration, and TSM’s technology platform extends beyond the two companies’ current collaboration to support future Intel embedded x86 products.  The Intel Atom processor features 47 million transistors and is Intel’s smallest processor. Products manufactured through the agreement may find adoption in embedded CPU market segments such as mobile internet Devices, smart-phones, netbooks, nettops, and AC-powered consumer electronics devices.

It seems that there is a race to see what will get smaller faster: your processor and chipset migrations vs. the balance on your 401/k.  In today’s market full of major selling, TSM shares are actually up marginally and Intel is down about 1.4%.  The DJIA is off over 3.3% and the NASDAQ is down about 3.1%.

Jon C. Ogg
March 2, 2009