) recently introduced two new technologies namely Embedded
Multi-die Interconnect Bridge ("EMIB") and High Density Modular
Test ("HDMT") for Custom Foundry customers in need of economical
advanced packaging and test technologies.
The EMIB technology is intended for 14nm foundry customers and
offers on-package functionality at a lower cost when compared to
the existing solutions. On the other hand, the HDMT platform will
allow quick test development and unit-level process control. It is
intended for application in diverse markets. Besides improving
productivity (as a result of using a common platform for low-volume
product debug to high-volume production), it also lowers time to
While EMIB will be accessible to foundry customers for sampling
in 2015, HDMT (already used by Intel internally) will be made
available with immediate effect.
Based in Santa Clara, CA, Intel entered the foundry business in
2010. In the beginning, the company only offered its services to a
small group of non-competitive customers. For instance, its foundry
business received a boost when Altera Corp. (
) became a customer in 2013.
Altera, being one of the biggest names in the market for FPGAs,
or chips that can be electrically programmed for specific jobs by
users after the devices have left the factory, has put pressure on
the other companies providing foundry services.
Intel also lured away Panasonic Corp. from Taiwan Semiconductor
Manufacturing Co. Ltd (
). Panasonic's chip division will use Intel to make system-on-chip
products using Intel's 14-nanometer technology, which is the most
advanced type of manufacturing process for semiconductors.
Foundry business is not that attractive for a company like
Intel, which has traditionally manufactured its own devices to
generate much stronger margins. But a number of factors could be
The most important would be the need for strong strategic
partners that could help it grow position in the Internet of Things
(IoT) market. Second would be the fact that it gives Intel a chance
to benefit from the strong growth in mobile (Intel's mobile market
share remains small). The third would be the increased utilization
of its significant capacity and its corresponding positive effect
on its margins.
The issue with becoming a foundry for Intel is that it gives its
competitors (Qualcomm, AMD and Samsung) access to the same advanced
CMOS processes that allowed it to gain such a dominating lead in
the PC market. The profit margins are also not as high.
Intel currently holds Zacks Rank #1 (Strong Buy). Competitor
Advanced Micro Devices (
) is lower ranked at Zacks Rank #3 (Hold) .
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