Chipmaker Innosilicon has completed testing of a prototype chip based on Semiconductor Manufacturing International Corp.’s (SMIC) FinFET N+1 process, according to a report from China.org.cn.
The move is important considering the recent decision by the Trump Administration to restrict American companies from doing business with the Chinese semiconductor foundry. The move by the Department of Commerce requires that American companies apply for an export license before selling its supplies to SMIC, including semiconductor equipment.
The move to blacklist SMIC, the world’s fifth ranked foundry, could cause a widespread disruption of China’s chip supply chain as SMIC produces chips used in mobile handsets, telecom base stations and tablets. SMIC relies on U.S. equipment and software for production processes such as printing circuits and inspecting products.
U.S. equipment suppliers such as Applied Materials, Lam Research and KLA are expected to bear the brunt of the impact of the sanctions against SMIC. However, the export restrictions will likely have less of an impact on suppliers of silicon wafers and other raw chemical materials for semiconductors as these are mostly Japanese and European vendors.
As SMIC is one of the few foundries in China with a roadmap to 14 nm and lower advanced process technologies, the blacklist could dramatically impact its future production and operations if it is unable to get the necessary equipment to support this process technology.
Growing China’s chip development
The milestone achieved by Innosilicon marks a huge step for China’s domestic chip development as SMIC’s N+1 foundry node is said to be comparable to the 7 nm process by Taiwan Semiconductor Manufacturing Company (TSMC).
SMIC said the N+1 7nm node is an improvement over its 14nm production node, boasting a 20% increase in performance, power consumption reduction of 57%, a reduced logic area by 63% and system-on-chip are reduction by 55%.
Currently, Chinese companies to do not currently have the 7 nm and 5 nm manufacturing capabilities needed to product advanced chips for smartphones but can produce 28 nm and 14 nm chips, used in other electronics other than phones. U.S. move to blacklist SMIC, will hinder its ability to qualify process technologies for these lower nodes unless an alternative can be found.
Domestic Chinese equipment suppliers are working toward this, but industry experts believe it may take another 5 to 10 years before it is ready. However, others believe if Chinese equipment suppliers pool resources, this time could be cut in half or even less time.
In the short term, SMIC will be able to continue production but the U.S. export restriction could slow down capacity expansion plans until these domestic vendors are able to reach advanced equipment processes.
