Any idea why they are doing this? Investors demand "something", so they start rearranging deck chairs? I'd assume they expect Avera to make even less money than GF (or perhaps more, and possibly inflate the stock price...).
If I wanted to fab a chip with GF, I'd want my tools from as close to the fab as possible, and this isn't helping. Maybe they think they can get tools from Samsung easier with a little distance between the tool company and the fab, but I can't imagine that really matters.
[hopefully this edits and not doubleposts] Any idea why they are doing this? Investors demand "something", so they start rearranging deck chairs? I'd assume they expect Avera to make even less money than GF (or perhaps more, and possibly inflate the stock price...).
If I wanted to fab a chip with GF, I'd want my tools from as close to the fab as possible, and this isn't helping. Maybe they think they can get tools from Samsung easier with a little distance between the tool company and the fab, but I can't imagine that really matters.
I guess the thing I missed is real deprication vs. tax deprication. I'm guessing fabs depricate in really nasty ways (although the outside building is a tax benefit, the insides only help if they suckered some locals into large corporate welfare). There might be some tax benefits here, but I'd still expect the real reason is to give the investors some indication that they are "doing something".
Sounded like the ASIC design group had to be able to offer TSMC 7 nm (or whoever the latest process leader is) to be competitive in that business segment. It probably helped create clear IP segregation between the design house, TSMC fab, and GF fab that allows them to have access to TSMC's design libraries.
The press release indicated that they've already established a foundry partnership ("...., including a newly established foundry partnership on 7nm") -- so I'm wondering if there's any word on who've their starting with....
It's not as if they have much choice, it can only be TSMC or Samsung. Historically, GF has been closer to Samsung (they shared some research and the resulting processes), but either, or even both, are possibilities.
GloFo is abandoning development of new high performance processes. In the future they'll only be doing new RF and other specialty types of work. That means they won't be able to present themselves to end users as a 1 stop shop, which would leave them at a major disavantage vs competitors. Moving their consulting services away from the main company (if only slightly at the moment) will make it easier for the consulting group to work with TSMC/Samsung for products that GloFo doesn't have the ability to produce. I wouldn't be surprised if they end up having to fully release the consulting business to lower barriers to TSMC/Samsung more, but as GloFo itself they probably have 0 traction due to the latter needing to protect their IP.
Might have something to do with their contract to manufacture CPUs for IBM... I suppose this allows for the CPUs to actually be fabbed at TSMC, but go through this company.
Because GF failed to implement "7" and even "10nm". So significant part of the market are not going to produce with GF. This way they at least hope to capture some consulting revenue, although it would be hard to compete with people who already have experience with TSMC and Samsung.
Unraveling of the terrible decisions which led to abandoning any further technological development...
ATIC should IPO GloFo if the company is profitable. Top of the market, and no one (outside of perhaps private equity) is going to buy a foundry - and probably not private equity because of the debt problem.
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wumpus - Friday, November 2, 2018 - link
Any idea why they are doing this? Investors demand "something", so they start rearranging deck chairs? I'd assume they expect Avera to make even less money than GF (or perhaps more, and possibly inflate the stock price...).If I wanted to fab a chip with GF, I'd want my tools from as close to the fab as possible, and this isn't helping. Maybe they think they can get tools from Samsung easier with a little distance between the tool company and the fab, but I can't imagine that really matters.
wumpus - Friday, November 2, 2018 - link
[hopefully this edits and not doubleposts]Any idea why they are doing this? Investors demand "something", so they start rearranging deck chairs? I'd assume they expect Avera to make even less money than GF (or perhaps more, and possibly inflate the stock price...).
If I wanted to fab a chip with GF, I'd want my tools from as close to the fab as possible, and this isn't helping. Maybe they think they can get tools from Samsung easier with a little distance between the tool company and the fab, but I can't imagine that really matters.
I guess the thing I missed is real deprication vs. tax deprication. I'm guessing fabs depricate in really nasty ways (although the outside building is a tax benefit, the insides only help if they suckered some locals into large corporate welfare). There might be some tax benefits here, but I'd still expect the real reason is to give the investors some indication that they are "doing something".
flgt - Friday, November 2, 2018 - link
Sounded like the ASIC design group had to be able to offer TSMC 7 nm (or whoever the latest process leader is) to be competitive in that business segment. It probably helped create clear IP segregation between the design house, TSMC fab, and GF fab that allows them to have access to TSMC's design libraries.wassick - Friday, November 2, 2018 - link
The press release indicated that they've already established a foundry partnership ("...., including a newly established foundry partnership on 7nm") -- so I'm wondering if there's any word on who've their starting with....frenchy_2001 - Friday, November 2, 2018 - link
It's not as if they have much choice, it can only be TSMC or Samsung.Historically, GF has been closer to Samsung (they shared some research and the resulting processes), but either, or even both, are possibilities.
DanNeely - Friday, November 2, 2018 - link
GloFo is abandoning development of new high performance processes. In the future they'll only be doing new RF and other specialty types of work. That means they won't be able to present themselves to end users as a 1 stop shop, which would leave them at a major disavantage vs competitors. Moving their consulting services away from the main company (if only slightly at the moment) will make it easier for the consulting group to work with TSMC/Samsung for products that GloFo doesn't have the ability to produce. I wouldn't be surprised if they end up having to fully release the consulting business to lower barriers to TSMC/Samsung more, but as GloFo itself they probably have 0 traction due to the latter needing to protect their IP.ibnmadhi - Saturday, November 3, 2018 - link
Might have something to do with their contract to manufacture CPUs for IBM... I suppose this allows for the CPUs to actually be fabbed at TSMC, but go through this company.peevee - Sunday, November 4, 2018 - link
It is a design house, not manufacturing house.peevee - Sunday, November 4, 2018 - link
"Any idea why they are doing this?"Because GF failed to implement "7" and even "10nm". So significant part of the market are not going to produce with GF. This way they at least hope to capture some consulting revenue, although it would be hard to compete with people who already have experience with TSMC and Samsung.
Unraveling of the terrible decisions which led to abandoning any further technological development...
del42sa - Monday, November 5, 2018 - link
Thy doing it to keep milking their customers like AMD via WSA....Sahrin - Friday, November 2, 2018 - link
ATIC should IPO GloFo if the company is profitable. Top of the market, and no one (outside of perhaps private equity) is going to buy a foundry - and probably not private equity because of the debt problem.