To fuel its so-called IDM 2.0 strategy, Intel Corp. will shift to an internal foundry model that will see the company continue to build its own semiconductors, maybe even expand the use of its own manufacturing.
The move is part of Intel CEO Pat Gelsinger’s multiyear plan called IDM 2.0 where the company transforms back to a manufacturing powerhouse with a scheduled five process nodes to be completed in four years. If Intel hits this goal, it could very well compete with the likes of foundry leader Taiwan Semiconductor Manufacturing Co. (TSMC) and chip giant Samsung Electronics — considered to be the leaders in semiconductor manufacturing currently.
What is IDM 2.0?
The strategy has three main goals.
First, to scale Intel’s manufacturing to be a key competitive advantage in the supply chain. This means continuing to manufacture most of its products internally. Intel is also developing a 7 nm process node driven by extreme ultraviolet (EUV) lithography. Additionally, the company seeks to reach lower process nodes quickly to catch up with TSMC and Samsung.
Secondly, Intel will build on its existing relationships with third-party foundries, which manufacture communications, connectivity, graphics and chipsets for Intel.
Third will be to expand its intel foundry services (IFS). Already, Intel has signed up Amazon, Qualcomm and MediaTek to its IFS and will continue to pursue U.S.- and European-based fabless companies to bring further competition to the semiconductor manufacturing space. As part of IFS, Intel acquired Tower Semiconductor to boost its portfolio of chip manufacturing for areas such as automotive electronic components that use more mature process nodes.
What is the internal foundry model?
Intel said the model will provide processes, systems and guardrails between its manufacturing teams and design and business units.
This will allow the company to identify inefficiencies in its model and put Intel’s product groups on a similar footing as external IFS customers and vice versa.
Gelsinger said Intel will create a foundry accounting model that will involve manufacturing, technology development and IFS to give it more transparency into the financial execution and allow Intel to fully benchmark its foundry performance.
