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Smartphone market outlook and the MediaTek Helio X10 based Xiaomi Redmi Note 2/Prime launched for $125, $140 and $156

Let’s start with an extremely good presentation video by Mrwhosetheboss:

And an actual experience video from Chinese sources (finished by comparing to iPhone 6):

Aug 16, 2015, Xiaomi Today: Xiaomi sold 800,000 Redmi Note 2 phones in 12 hours

Note that Xiaomi has already been the top Chinese company tracked here:
Dec 12, 2012UPDATE Aug’13: Xiaomi $130 Hongmi superphone END MediaTek MT6589 quad-core Cortex-A7 SoC with HSPA+ and TD-SCDMA is available for Android smartphones and tablets of Q1 delivery
Aug 1, 2013Xiaomi, OPPO and Meizu–top Chinese brands of smartphone innovation
Aug 30, 2013Assesment of the Xiaomi phenomenon before the global storm is starting on Sept 5
Sept 5, 2013Xiaomi announcements: from Mi3 to Xiaomi TV
June 12, 2014Xiaomi’s global offensive with Hugo Barra in charge is threatening Apple—with 10.4 million smartphones sold in China it had already outsold Apple in Q1’14, having “just” 9 million iPhones sold there from which we must at least understand the market situation in China upto  Q1 2014 as the reference for the Xiaomi’s progress presented here:

With the Q3 2015 Redmi Note 2/Prime advancement Xiaomi will kill the much hoped (by some stock market analysts) incremental opportunities for the $199 Apple iPhone 6 and $299 iPhone 6 Plus in China and throughout the world. And recall that those were announced 11 months ago as “The Biggest Advancements in iPhone History

China smartphone market Q2 2015 by IHS Technology -- 23-July-2015

This report is similar to later Canalys findings: Xiaomi 15.9%, Huawei 15.7%, and Apple #3. But for the rest: #4 Samsung, #5 vivo. Globally Xiaomi became the #2 Chinese smartphone brand in Q2 2015 according to TrendForce with 5.9% market share, the #1 Huawei having 7.6%, but first time surpassing Lenovo, as well as continuing to distance itself from TCL (Alcatel) and OPPO. Similar to data from Counterpoint Research. See Chinese OEMs Rule. Considering Huawei’s aggressive push since 2011, when Xiaomi devices started in China, Xiaomi’s global achievement is a very remarkable feat.  

Why? Because being in the smartphone device business for just 4 years Xiaomi has already been on or around the top in China for the last 12 months, as well as has launched an impressive global march.

That global sales campaign has been going on in Asia, Russia and Turkey so far, but it is now expanding to Latin America with new model launching in Brazil [CCTV America YouTube channel, July 14, 2015]: “The world’s third largest smartphone maker is taking a different approach in its plans for global domination. Instead of looking to expand in the obvious markets like the U.S. and Europe, Xiaomi is looking to South America. CCTV’s Paulo Cabral filed this report from Sao Paulo.”

And it is not difficult to foresee a huge global success for the company as in India Xiaomi became “the 5th biggest seller of phones in the country, a feat accomplished in only 8 months“: Smartphone company Xiaomi expanding to India and beyond [CCTV America YouTube channel, March 20, 2015]
And now 
China’s Xiaomi Begins Making Smartphones in India [Voice of America, Aug 14, 2015]: “Xiaomi’s Redmi2 Prime smartphone [NOT the Note 2 one], priced at about $110, began rolling out from a factory in Sri City in southern Andhra Pradesh state this week. … entered the Indian market just a year ago, but since then price conscious consumers have snapped up 3 million phones.

Also this all happened after “The Chinese smartphone maker, Xiaomi, held a second flash sale of its new 4.7″ Redmi 1S [at $110/699 RMB almost of the same price level as this year’s $125/799 RMB Redmi Note 2on Tuesday [Sept 9, 2014], after selling out in just four seconds a week ago.“: Chinese smartphone Xiaomi competes with Apple [CCTV America YouTube channel, Sept 9, 2014]

from which I will include the following Q2 CY2014 market share slide for China here:
Xiaomi - Q2 CY2014 smartphone market share for China by Canalys -- 9-Sept-2014
as this position of being “on the top or around it” has been kept by Xiaomi ever since. 

Then we should not forget what only 8 months ago was introduced as Xiaomi launches MiNote, a new iPhone competitor [CCTV America YouTube channel, Jan 15, 2015]: “The tech world is abuzz about Chinese tech company Xiaomi’s bid to compete with Apple and Samsung. Xiaomi CEO Lei Jun unveiled the MiNote and MiNote Pro [at $313/1999 RMB and $391/2499 RMB a kind of twice as expensive predecessors to the new Redmi Note 2/Prime] on Thursday, both are cheaper than similar iPhone models. CCTV’s Xia Cheng reported this story from Beijing.

Finally we should look at the new specification comparisons by GSMinsider: Xiaomi - Redmi Note 2 vs iPhone 6 vs iPhone 6 Plus – Specs Comparison -- 14-Aug-2015

With that Xiaomi will kill Samsung high-end opportunities as well.

Let’s look first at the quite drastic decline of the Samsung smartphone business for the last year and a half (data from Strategy Analytics as it’s been represented in the Apple and Huawei move on Samsung article of July 30, 2015 from Telecom.com, with the vendor rankings in the table according to the latest quarter, i.e. Q2 2015): Strategy Analytics - Global Smartphone Share -- Q1 2014 - Q2 2015
Note that Coolpad (Yulong) and ZTE are also globally represented Chinese brands, not mentioned so far in this article.

Which unit-wise looks like as follows (in millions):Strategy Analytics - Global Smartphone Shipments -- Q1 2014 - Q2 2015

Then I can again refer to Samsung-related high-end specification comparisons produced by GSMinsider: Xiaomi - Redmi Note 2 vs Samsung Galaxy Note 4 vs Samsung Galaxy S5 – Specs Comparison -- 14-Aug-2015
And don’t be fooled with the Qualcomm Snadragon 805 and 801 SoCs used by Samsung in these 2014 vintage devices as Samsung itself abandoned Qualcomm as an SoC supplier for its 2015 devices:Xiaomi - Redmi Note 2 vs Samsung Galaxy S6 vs Samsung Galaxy S6 Edge – Specs Comparison -- 14-Aug-2015

CINNO Research - Q1 2015 China Smartphone Rear Camera Pixel Share -- 12-April-2015Note: Such Samsung move of abandoning the Qualcomm Snadragon 805 and 801 SoCs in its latest high-end products is not an accident but a hard-pressed necessity. The octa-core Qualcomm Snadragon 810 replacing the 805/801 had serious thermal throttling problems, and the Chinese brands were starting to use other octa-cores, among them the quite competitive MediaTek Helio X10. See the following Q1 2015 technology landscape presentation composed of the graphical views from the April 12 and April 24 reports by CINNO Research (in addition to the camera related view on the right):CINNO Research - Q1 2015 China Smartphone Display and CPU Technologies -- 12-24-April-2015

And software-wise Xaomi is already 5 years in the smartphone business with a lot of quite enthusiastic supporters for its Android based Mi User Interface throughout the world. The MIUI 5th Anniversary: Greetings From MIUI Fans From All Over The World testimonial video from the MIUI ROM YouTube channel dated August 12, 2015 is stating that: “MIUI is one of the most popular Android ROMs in the world. It is based on Android, featuring a rich user experience and user customizable themes. MIUI is updated every Friday based on feedback from its users. Now with over 100 million users and 34 MIUI fan sites worldwide, MIUI is the choice of many Android users globally.

What kind of “much hoped incremental opportunities (by some stock market analysts) for Apple” I was talking about?

From India Will Overtake US to Become World’s Second Largest Smartphone Market by 2017 [July 1, 2015] by Strategy Analytics the following chart has been produced for Dazeinfo’s Global Smartphone Sales 2015 – 2017: India Will Surpass The US [July 1, 2015] report: Strategy Analytics - Dazinfo - Global Smartphone Sales Forecast 2015 - 2017 -- 1-July-2015That chart has been used by  in his Why Apple’s Growth-Related Fears Are Overblown [Aug 12, 2015] article on Seeking Alpha for its final argument that:

the market sees China as imperative to Apple’s future growth outlook and while true at the moment, there’s a catalyst forming that should lessen the company’s reliance on China and lead to many millions of new iPhone sales.

China is not that “forming catalyst” that I mentioned earlier. Instead, Apple has a prime opportunity to grow in India over the next year or two, a market that’s growing rapidly with middle class consumers and is the world’s second largest economy by population behind only China.


… with India’s help, which includes the growth in middle class consumers through 2020, India might very well one day become just as important as China to Apple.

Before coming to such final argument Nichols is talking about the current market situation in China via a chart from Above Avalon’s China Mobile Is a Game Changer for Apple [April 29, 2015] research note and with the following comments around that:

Above Avalon - Total Customers for Largest Chinese and U.S. Mobile Carriers -- 28-April-2015

I expect Apple to find additional growth in China next year, regardless of what has transpired from a macro perspective over the last few months. The reason is simple: Improved network coverage. Fact of the matter is that most Chinese consumers are still using 2G or 3G networks, which are hardly compatible with the iPhone 6. At the end of the first quarter, China Mobile (NYSE:CHL) had 153 million 4G customers, up from 90 million in December of 2014 and just 1.3 million in February of 2014. However, China Mobile had 815 million total customers. So that means the majority of its subscribers are still on 2G or 3G networks. Given the rate at which China Mobile has added 4G customers during the last 16 months, investors can rest assured that its network and 4G customers will be far larger by this time next year. Notably, most of those 4G customers will need smartphones, and Apple has quickly become the most popular choice in China.

As for China’s second and third largest wireless carriers, China Unicom (NYSE:CHU) and China Telecom (NYSE:CHA), they have nearly 500 million customers collectively. And believe it or not, China Unicom and China Telecom’s 4G network is even more underdeveloped than China Mobile’s network. However, both China Unicom and China Telecom are working just as fast to build their respective 4G networks. Once more, this increases Apple’s market opportunity in China, and is the key reason why I think Apple’s growth in China will continue through next year, probably at a very high double-digit rate.

So these are the speculations which IMHO do not take into account the new product waves from major Apple and Samsung competitors, especially Xiaomi.

Xiaomi’s new 5.5″  Redmi Note 2 launched in China just this week for $125/799 RMB (16GB version supporting TDD-LTE for a China specific 4G version of LTE as well as TD-SCDMA, the China specific 3.5G — targeted at China Mobile subscribers) and $140/899 RMB (16GB version supporting both TDD-LTE and FDD-LTE, i.e. both 4G versions — for the subscribers of any mobile operators, and especially of China Unicom and China Telecom) is the actual case in this regard. Watch the Xiaomi Redmi Note 2 Prime first look miui 7 pre-order video direct from the launch (the QR code at the start and the end has been positioned out of my embedded view): 

Announced: August 13 2015
Network Technology:
GSM / HSPA / LTE
Expected release:
August 16, 2015
Body Dimensions:
152 x 76 x 8.3 mm
Weight: 160 g
SIM: Dual SIM
Display
Type: IPS LCD capacitive touchscreen, 16M colors
Size: 5.5 inches (~72.2% screen-to-body ratio)
Resolution: 1080 x 1920 pixels (~401 ppi pixel density)
Multitouch: Yes
MIUI 7.0
Platform OS: Android OS, v5.0 (Lollipop)
Chipset: Mediatek MT6795
CPU:
– Octa-core 2.0 GHz Cortex-A53
– Octa-core 2.2 GHz Cortex-A53
GPU: PowerVR G6200
Memory Card slot: No
Internal Memory:
– 16 GB, 2 GB RAM – 2 GHz model
– 32 GB, 2 GB RAM – 2.2 GHz model
Camera:
Primary: 13 MP, 4128 x 3096 pixels, phase detection autofocus, LED flash
Features: Geo-tagging, touch focus, face/smile detection, HDR, panorama
Video: 1080p@30fps
Secondary: 5 MP, 720p
Sound Alert Types:
Vibration; MP3, WAV ringtones
Loudspeaker: Yes
3.5mm jack: Yes
Comms:
WLAN Wi-Fi 802.11 a/b/g/n/ac, dual-band, WiFi Direct, hotspot
Bluetooth: v4.0, A2DP, LE
GPS: Yes,
with A-GPS, GLONASS, Beidou
Infrared port: Yes
Radio: FM radio
USB: microUSB v2.0
Features Sensors:
Accelerometer, gyro, proximity, compass
Messaging:
SMS(threaded view), MMS, Email, Push Mail, IM
Browser: HTML5
Java: No
– Fast battery charging: 60% in 30 min (Quick Charge 2.0)
– Active noise cancellation with dedicated mic
– MP4/H.264 player
– MP3/WAV/eAAC+ player
– Photo/video editor
– Document viewer
Battery: Li-Po 3060 mAh battery
Stand-by: Up to 144 h (3G)
Talk time: Up to 11 h 30 min (3G)
Music play: Up to 46 h
Misc Colors:
White, blue, yellow, pink, mint green

The 2.2 GHz Redmi Note 2 Prime version with 32GB storage and support of  TDD-LTE + FDD-LTE will sell at $156 (999 RMB).

More information:
Aug 13, 2015All About Redmi Note 2/Prime: Specifications, Price, Hands-on Pictures! review by Xiaomi MIUI Official Forum
– Aug 13, 2015Xiaomi New Product Launch: MIUI 7(China), Redmi Note 2(Prime), Mi Wi-Fi nano full launch information (not only the Redmi Note 2/Prime)  by Xiaomi MIUI Official Forum, from which the major Redmi Note 2 and 2 Pro Android competition (Huawei P8 and P8max with Hisilicon Kirin 930 and 935 SoCs, and Meizu MX5 (with the same MediaTek Helio X10 @2.2 GHz) on the Chinese market is described as:
Redmi Note 2 and 2 Pro Android competition on the Chinese market -- 13-Aug-2015
Note: regarding the benchmarked performance of each SoC I will recommend the results made available in the Exynos 7420 vs Snapdragon 810 vs MediaTek Helio X10 Turbo MT6795T vs Hisilicon Kirin 935: Benchmark Scores [July 3, 2015] GSMinsider article
For a much broader competitive comparison I will recommend the Redmi Note 2’s comparisons by GSMinsider  which currently contains comparisons (spec-wise):

vs Asus Zenfone 2 vs Asus Zenfone Zoom
vs HTC One M9 vs HTC One M9+
vs Huawei Honor 7 vs Huawei Honor 6 Plus
vs Huawei Ascend Mate 7 vs Huawei Honor 6 Plus
vs Huawei P8 vs Huawei P8 Max
vs iPhone 6 vs iPhone 6 Plus
vs Lenovo Vibe Shot vs Lenovo Vibe Z2 Pro
vs Lenovo ZUK Z1
vs LG G Flex 2
vs LG G4 vs LG G3
vs Meizu M2 Note vs Meizu M1 Note
vs Meizu MX5 vs Meizu MX4 Pro
vs Motorola Moto X Style vs Moto X Play
vs Nexus 6 vs Motorola Moto Maxx
vs OnePlus 2 vs OnePlus One
vs Oppo Find 7 vs Oppo Find 7A
vs Oppo N3
vs Redmi Note
vs Samsung Galaxy Note 4 vs Samsung Galaxy S5
vs Samsung Galaxy S6 vs Samsung Galaxy S6 Edge
vs Vivo X5 Pro vs Vivo X5 Max
vs Xiaomi Mi Note vs Xiaomi Mi Note Pro
vs Xiaomi Mi4
vs ZTE Axon Pro vs ZTE Axon Lux
vs ZTE Nubia Z9 Max vs Nubia Z9 Mini
vs ZTE Nubia Z9

Aug 13, 2015Additional videos from XiaomiHK YouTube channel:

Xiaomi – MIUI Introduction (with English subtitles)

Xiaomi – MIUI V7 Endurance

i.e. MIU 7 on [Xiaomi’s] Mi 4, Huawei Honor 6, Meizu MX4 and Samsung Galaxy S5

Xiaomi – MIUI V7 Performance

Xiaomi – RedmiNote2″>Xiaomi – RedmiNote2

Xiaomi – RedmiNote2 Camera

Important videos available on the Bloomberg Business website only, with 3 most important videos added to them from the CCTV America YouTube channel:

June 5, 2014: Here’s Why Hugo Barra Left Google to Be Xiaomi VP: Xiaomi Early Investor Robin Chan discusses Xiaomi’s hiring of Google’s Hugo Barra on Bloomberg Television’s “Bloomberg West.” Former Xiaomi Board Member Hans Tung also speaks.

July 17, 2015Xiaomi’s Hugo Barra: Studio 1.0 (Full Show 7/16): This week on Studio 1.0: Emily Chang sits down with Hugo Barra, vice president of global operations at Xiaomi. (Source: Bloomberg) 21 minutes from which I will include here the only slide displayed Xiaomi - Global ambition -- 17-July-2015

Plus a lot of other unique information is available in that interview: like the 2015 vintage business model of Xiaomi (investments into non-platform startups to build business partnerships, a whole ecosystem around Xiaomi etc.).

I will add to that the product shown in the Bloomberg interview as an example of such ecosystem generation. This has been documented in Xiaomi launches $13 fitness band [CCTV America YouTube channel, Aug 18, 2014] as: “Chinese Smartphone maker Xiao-mi has started selling an interactive wristband called the Mi Band. The device can measure one’s heart rate and monitor sleep patterns. It’s not the first such device to hit the market, but so far, it’s the cheapest.

I will also add the Xiaomi Buying Spree Gives Apple, Samsung Reason to Worry [Bloomberg Business YouTube channel, Jan 8, 2015] video stating that: “Xiaomi zoomed past Apple Inc. and Samsung in China smartphone sales just three years after releasing its first model. Founder Lei Jun is now on a buying spree to take that momentum beyond handsets. Bloomberg’s Edmond Lococo has more on “On The Move Asia.” (Source: Bloomberg)

Then remember the already known facts mentioned in the second video on the Bloomberg website like: “Xiaomi is not Apple“, “Xiami is an Internet company” (“an Internet platform and services brand” heard in another interview), “services are inherent part of Xiaomi“, “Xiaomi is one of the biggest e-commerce sites in China“, “the Xiaomi platform products are enhanced in functionality on requests from its users by around 50%” etc.

As the latest proof-point of such an Internet platform and service strategy of the company watch the Chinese mobile co. Xiaomi launches wallet app [CCTV America YouTube channel, March 26, 2015] video:

Other videos from Bloomberg Business YouTube channel:

Jan 15, 2015Xiaomi’s Rapid Rise to $45B Valuation Topping Uber: Xiaomi is Apple and Samsung’s rapidly growing threat. Now the world’s third-largest smartphone maker, Xiaomi is releasing its next phone on Thursday at an event in Beijing. Bloomberg’s Cory Johnson looks at how just fast this company is growing. (Source: Bloomberg)

June 5, 2014Meet the Billionaire ‘Steve Jobs of China’ Lei Jun:  Xiaomi co-founder and chief executive officer Lei Jun is known as the Steve Jobs of China, complete with a wardrobe of black shirts and a cult following. But what did he do before starting Xiaomi, and how has his personality helped drive Xiaomi’s success? Bloomberg West’s Emily Chang gives us an overview of this rock star CEO.

Jan 5, 2015Xiaomi Doubles Revenue to $12B as Phone Sales TripleXiaomi, whose investors include billionaire Yuri Milner, more than doubled its revenue in 2014, according to a blog posting by CEO Lei Jun.

Feb 13, 2015Xiaomi’s Barra: U.S. Market Is Important in Many Ways:  Xiaomi’s Hugo Barra discusses the company’s global expansion plans with Bloomberg’s Brad Stone on “Bloomberg West.”

June 4, 2015Xiaomi Grows Wearable Device Market ShareXiaomi is looking to elbow its way into the wearable device market. New figures suggest it took a quarter slice of global sales the first three months of the year. Bloomberg Intelligence’s Jitendra Waral discusses the sales figures on “Trending Business.”

Other videos from the CCTV America YouTube channel:

July 22, 2014Hugo Barra on latest Xiaomi products: Chinese tech firm Xiaomi showed off some of its latest products on Tuesday. The Beijing-based company unveiled its new Mi smartphone and billed it as a challenger to Apple’s iPhone. Analysts say the Mi 4 will be a make or break product for Xiaomi after sales of the older model proved disappointing.The company is also aggressively expanding overseas. Hugo Barra, Xiaomi’s Vice President for overseas business spoke with CCTV’s Xia Cheng.

July 14, 2015Eric Schiffer on Xiaomi’s global strategy: For more on Xiaomi’s global strategy, CCTV’s Michelle Makori spoke to Eric Schiffer, CEO of Patriarch Equity.

Dec 22, 2014
Tech company Xiaomi flourishes in China, India despite patent disputes: China’s Xiaomi tech company is often compared to Apple. Founded in 2010, Xiaomi has quickly surpassed Samsung to become the top smartphone in China and third in the world. Xiaomi phones are currently only sold online and in China and India.

Dec 22, 2014
Ari Zoldan of Quantum Networks discusses Chinese companies, patent troubles: CCTV America’s Sean Callebs interviewed tech industry expert and CEO of Quantum Networks Ari Zoldan about the rise of Xiaomi and it’s legal battles.

 



Embedded Android — A VIA Technologies Strategic Direction in addition to its earlier joint CPU venture with the Shanghai government

– Nov 12, 2012 – July 11, 2014: Can VIA Technologies save the mobile computing future of the x86 (x64) legacy platform? for preliminary reading on this blog
– October 8, 2014: Coming very soon from Centaur Technology: A Leap Ahead in Chip Design as a very small glimpse into the next generation by the Centaur Technology
– October 13, 2014: Centaur Technology: Do the same job that an Intel processor can do, but doing it less expensively, with a much smaller group and Glenn Henry in charge as another as a very small glimpse …
June 3, 2015VIA pushing for profitability in 2015 by DIGITIMES

VIA Technologies [威盛電子] president Chen Wen-Chi [陳文琦 the spouse of Cher Wang Chairwoman and CEO of HTC] has maintained that the company will not be delisted from the Taiwan Stock Exchange (TSE) and will have a good chance of turning profitable in 2015. [http://technews.tw/2015/06/02/via-technologies-condition/: “this year the operation has turned the corner, there is the opportunity to turn profit, but not sure]

Chen said during a shareholders meeting on June 2 that VIA’s revenue performance became stable in 2014, while losses have also started narrowing. With its embedded platform and digital signage businesses starting to contribute profits, VIA is expecting an optimistic result for 2015.

As for the recent market rumor about Intel considering acquiring its subsidiary GenieNetworks[a CDMA licensing business having 2 clients by the end of 2014], Chen declined to comment.

December 29, 2014: Ownership of the Centaur Technology has been transfered to VIA CPU PLATFORM, INC. established on December 17, 2013 (⇒威盛電子:代子公司VIA USA Inc.公告進行美國子公司Centaur Technology Inc.股權之投資架構調整) and whose president is Timothy Chen (陳主望), Cher Wang’s nephew

December 25, 2014VIA to return to profitability in 2015, says company president by DIGITIMES

… As for the China government’s recently announced strategy to fully support and nurture local semiconductor players, Chen believes it could bring a strong challenge to the Taiwan and worldwide semiconductor industries, but VIA has been forming partnerships with China’s players and will only see limited impact from the policies.

November 21, 2014VIA stock demoted in TSE; expects strong performance in 4Q14 by DIGITIMES

VIA Technologies has recently been demoted to become a full-cash delivery stock by the Taiwan Stock Exchange (TSE) because its stock’s net asset value dropped below NT$5 (US$0.16) in the third quarter. Commenting on the incident, special [technical] assistant to the president [also Head of Sales and Marketing since 1996 according to LinkedIn and VP Business Development and Strategy, VIA Technologies, HTC according to World Economic Forum 2015], Timothy Chen pointed out that the company had losses in the third quarter because its embedded solution orders were delayed and it had non-recurring engineering (NRE) expenses.

Although VIA’s CPU business continues to suffer from losses, the company’s invested Wondermedia [in 2014 focused on ARM-based tablet and STB processor development], VIA Labs [having USB 3.0 chips already for the 2014 market] and GenieNetworks as well as the joint venture with the government of Shanghai, China still contribute income.

Chen noted that VIA has not yet given up the x86 CPU market and its licensing agreement with Intel is valid until 2018. Although VIA did not achieve much performance in the PC market, the company is seeing stable orders for embedded applications such as digital signage.

The company’s joint venture with the Shanghai government is currently developing x86-based processors and 3D graphics chips and should help the company return to the PC market in the second half of 2015. The joint venture has R&D centers in Shanghai, Beijing and Wuhan, China and has about 600 employees currently.

February 19, 2014VIA reportedly moving x86 CPU resources to new joint venture in China by DIGITIMES

VIA Technologies is rumored to have started shifting its x86 CPU technologies and related personnel to its newly formed IC design joint venture with a China government-owned investment firm, according to market watchers

The joint venture was announced in early 2014 with VIA owning a 20% stake in the company.

Because VIA’s x86 CPU business is licensed by Intel, moving related resources to a new joint venture is expected to attract Intel’s attention. However, the chip giant may not be able to do much because Intel reached an agreement with the US’s Fair Trade Commission (FTC) in 2010 to not interfere with competition in the CPU and chipset markets, and extend its licensing of PCI Express to VIA by at least another six years. Intel is also unlikely to wish to offend the China investment firm, which has support from the China government, the market watchers analyzed.

VIA Alliance Semiconductor Co., Ltd. > Introduction:

VIA Alliance Semiconductor Co., Ltd. [磐聚网] was established in April 2013 with a total registered capital of USD$250M. As a joint venture between Shanghai Alliance Investment Ltd. [SAIL] who is affiliated to Shanghai SASAC and VIA Technologies, Inc., VIA Alliance Semiconductor Co., Ltd. has about 1000 employees and locates its headquarter at Zhangjiang of Shanghai with branches in Beijing, Hangzhou, Wuhan, Shenzhen, Taiwan, California and Texas of America.

With the forefront technologies and know-how in the design of CPU, GPU and chipsets, VIA Alliance Semiconductor Co., Ltd. is well known to provide high security, high performance, low power dissipation, and low cost SoC solutions.

As a fabless SoC factory, VIA Alliance Semiconductor Co., Ltd. adopts advanced 40nm and 28nm semiconductor processes. VIA Alliance Semiconductor Co., Ltd.’s main products include CPU and chipsets for desktop PC and laptop and ARM Cortex series SoC with its state of the art Elite series GPU and Video Engine IPs. VIA Alliance Semiconductor Co., Ltd. aims at becoming the leading SoC solution supplier for smart TV, smart phone and enterprise

January 17, 2013: VIA forms IC joint venture with Shanghai Alliance Investment by DIGITIMES

VIA Technologies has announced that it has set up an IC design house jointly with Shanghai Alliance Investment Company targeting the growing chip market in China.

The joint venture will be capitalized at US$250 million with Shanghai Alliance Investment contributing 80.1% of total capital, while VIA makes up the remaining 19.9%. An initial investment of US$100 million is slated for completion by the end of March 2013, VIA said.

VIA posted revenues of NT$3.36 billion (US$115.47 million) for 2012, decreasing 20.8% from a year earlier.

September 2014: Research and development of Lenovo M6000/S6000 desktops with ZX-A C4350AL [VIA Nano X2 announced on January 4, 2011] CPU have been completed
November 2014: Mass production of Great Wall desktops using ZX-A C3450AL total solution have been achieved

– Targeting a range of Desktop products ZX-A processors and V11PH solution extend the reach into multitasking and performance-oriented segments and offer end users an optimal, power-efficient computing experience
ZX-A processors are built using the latest 40nm fabrication process. ZX-A processors’ package size is 21mm x 21mm and the die size is only 11mm x 6mm. The launched processor name is C4350AL (the Clock Speed is 1.6G+).
– ZX-A processors are x86 architecture CPUs, support 32-bit/64-bit and the extended instruction sets. ZX-A are the first truly optimized, low power dual-core processors delivering industry leading performance-per-watt and improved multi-tasking ability, without consuming more power. ZX-A processors leverage a multi-core architecture to offer up to twice the performance in multi-thread optimized applications, while staying within the same signature low-power envelope.
– Featuring two out-of-order x86 cores, ZX-A processors come with native 64-bit software support, VT CPU virtualization technology, and PadLock hardware security features.

– Targeting a range of Mobile Notebook products ZX-A processors and VX11H solution extend the reach into multitasking and performance-oriented segments and offer end users an optimal, power-efficient computing experience
– ZX-A processors are built using the latest 40nm fabrication process. ZX-A processors’ package size is 21mm x 21mm and the die size is only 11mm x 6mm. The launched processor name is C4350AL (the Clock Speed is 1.6G+).
– ZX-A processors are x86 architecture CPUs, support 32-bit/64-bit and the extended instruction sets. ZX-A are the first truly optimized, low power dual-core processors delivering industry leading performance-per-watt and improved multi-tasking ability, without consuming more power. ZX-A processors leverage a multi-core architecture to offer up to twice the performance in multi-thread optimized applications, while staying within the same signature low-power envelope.
– Featuring two out-of-order x86 cores, ZX-A processors come with native 64-bit software support, VT CPU virtualization technology, and PadLock hardware security features.

ZX-C series processor is a new generation of quad-core processors, they are designed for high-performance computing
– ZX-C processors are built using the latest 28nm fabrication process. ZX-C processors’ package size is 21mm x 21mm and pin to pin match with ZX-A.
– There are 4 CPU cores integrated on the single chip packaging. Delivering industry leading performance per watt and improved multi-tasking ability, without consuming more power. ZX-C processors leverage a multi-core architecture to offer up to quad the performance in multi-thread optimized applications, while staying within the same signature low-power envelope.
– Featuring four out-of-order x86 cores, ZX-C processors come with native 64-bit software support, VT CPU virtualization technology, and hardware security features.
VX11PH Chipset offering a world-class HD multimedia platform for media-intensive applications

Already visible in July through benchmarks the next stepping of the legacy Isiah line: CentaurHauls Family 6 Model 15 Stepping 14 ⇒ VIA Technology Inc. VT3456 6628AMB, VIA QuadCore @ 2.00 GHz 2 processors, 8 cores

So the once influential VIA Technologies is desparately trying to regain its stance by capitalising on the technological fruits of the smartphone revolution which has already ended by Qualcomm’s alignment with latest developments in China via downsizing, Allwinner and Microsoft collaboration.

There are two lines of strategic actions for VIA which have become public as such recently:

1. May 20, 2015VIA Smart ETK For Embedded Android 

The VIA Smart ETK for Android provides an application programming interface (API) that simplifies Android system development on VIA Embedded ARM platforms by enabling the Android application to access I/O and manageability services provided by the system hardware that are not supported in the Android framework. These APIs help safeguard against system crashes and provide the ability to schedule auto power on and off, as well as periodic system reboots to ensure maximum performance.

The VIA Smart ETK for Android is also bundled with Smart ETK Demo, which is easy to install and has a user-friendly GUI for demonstrating the functions of VIA Embedded ARM platforms. Both the VIA Smart ETK and Smart ETK Demo are easy-to-use tools that help to shorten development time and speed up time to market. Key features include the following:

Watchdog:
This provides an API which allows the user to set a timer to ensure proper operation and help the applications/system to recover from a dead circle or breakdown. When it is set, the system will automatically reboot if no “feeding dog” signal is received.
System Power Off / Reboot:
This provides APIs that allow the user to use an Android application to schedule when the system should power off as well as set periodic reboots to ensure maximum performance is maintained.
RTC Wake-Up:
This provides an auto power on feature by setting the Remote Time Clock (RTC) auto wake-up timer. The RTC supports three auto wake-up modes:
  • Wake-up on a specified hour and minute every day
  • Wake-up on a specified day/ hour/ minute every week
  • Wake-up on a specified day/ hour/ minute every month

Legacy I/O Support:
The VIA Smart ETK enables legacy I/O support such as RS-232, by opening up GPIO, I2C, and CAN bus ports to the application.

February 26, 2015: VIA SMART ETK for Android post on VIA News by Richard Brown VP of International Marketing

We’ve seen a tremendous amount of interest in the VIA SMART ETK at Embedded World this week, particularly for embedded Android system design applications.

As its name implies, the VIA SMART ETK is an embedded tool kit that we offer as part of our software engineering services in order to facilitate the development of embedded systems and devices on based on our ARM and x86 platforms.

The VIA SMART ETK for Android is available with the VIA VAB-600, VIA VAB-820, and VIA VAB-1000 boards, as well as the VIA ALTA DS, VIA ALTA DS 2, VIA ARTiGO A900, and VIA Viega systems. It provides an application programming interface (API) that simplifies Android system development by enabling the Android application to access I/O and manageability services provided by the system hardware that are not supported in the Android framework. These APIs help safeguard against system crashes and provide the ability to schedule auto power on and off, as well as periodic system reboots to ensure maximum performance.

One of the key features we have enabled in the VIA SMART ETK for Android is support for legacy I/O such as RS-232 by opening up the GPIO, I2C, and CAN bus ports to the application. Others include Watchdog, System Power Off/Reboot, and RTC Wake-Up. To learn more, please visit the ARM Software Engineering Services page on our website and download our white paper “Cracking the Embedded Android Code” [January 26, 2015].

We are committed to the continued long-term development of the VIA SMART ETK for Android and regularly issue new releases of it for the boards and systems listed above. Watch this space for news of the latest updates.

2. [February 5, 2015Android-Based Digital Signage SolutionsSignage Solution Pack for Android as the first of software solution packs optimized to meet the requirements of specific vertical market segments

The Signage Starter Solution Pack for Android has been designed to accelerate the development of digital signage solutions using the VIA ALTA DS and VIA ALTA DS 2 [Oct 15, 2014 ⇒ the Solution Pack already came with ⇒Android Signage Goes Dual Screen with VIA ALTA DS 2] systems. It includes a number of APIs that help safeguard against system crashes provide the ability to schedule auto power on and off as well as periodic system reboots to ensure maximum performance, unique to Android OS for digital signage applications. Key features include:

Watch Dog:
Provides an API which allows the user to set a timer to ensure proper operation and help applications/system to recover from a dead circle or breakdown. When it is set, the system will automatically reboot if no “feeding dog” signal is received.
System Power Off / Reboot:
Provides APIs which allow the user to use an Android application to schedule when the system should power off as well as set periodical reboots to ensure maximum performance is maintained.
RTC Wake-Up:
Provides an auto power on feature by setting Remote Time Clock (RTC) auto wake-up timer. The RTC supports three auto wake-up modes:
  • Wake-up on a specified hour and minute every day
  • Wake-up on a specified day/ hour/ minute every week
  • Wake-up on a specified day/ hour/ minute every month

Customer ID:
Provides a unique ID which matches the software to a particular VIA ALTA DS system helping to protect the customer’s application or to identify a particular system.

July 9, 2015: Embedded Android Survey – The Results Are In! by Michael Fox of VIA Technologies

Android-survey-1

The growing popularity of visual applications for displaying increasingly rich data sets is clearly a key driver behind the rising momentum of Android among embedded developers. Industrial Automation (28%), Infotainment (20%), and Digital Signage (12%) were the top three applications in the survey, closely followed by HMI (11%) and Medical (11%).

Andorid-survey-benefits

The ability to add a touch interface (26%) was listed by respondents as the main benefit of adopting Android, with reduced time to market (25%) and customizability (19%) coming in second and third respectively. Native multimedia support (14%) in the O/S and the robust Android app ecosystem (12%) were also seen as important.

As a mobile O/S, Android does offer some critical challenges for developers to overcome when implementing it for embedded applications, including its lack of I/O support for peripherals (23%), the need to maintain different versions of it, and ensuring security (17%). Building up internal Android development expertise (21%) and finding the right development tools (19%) are other key issues embedded developers face in adopting the O/S.

We’d like to thank everyone who responded to the survey for the invaluable feedback they provided. We have already begun analyzing the results in order to determine how we can improve the platforms and services we offer for Embedded Android, and will be updating you on our progress.

Download the full results here.

As the enhancement of the technology portfolio there is the new
Apr 8, 2015: HD Video Monitoring Starter Kit

The VIA HD Video Monitoring Starter Kit is a turnkey solution aimed at accelerating the development of wireless multi-node video monitoring systems for the rapidly growing home and commercial markets.The starter kit includes:


VIA ALTA DS 2 System

ALTA_DS_2_ProductAt the heart of the starter kit is the ultra-compact fanless VIA ALTA DS 2 system. Powered by a 1.0GHz dual core VIA Elite E1000 Cortex-A9 SoC with a high-performance 2D/3D graphics and video engine that supports Open GL ES 3.0 hardware acceleration and simultaneous multiple Full HD video playback. The VIA ALTA DS 2 includes SATA and Micro SD Card support, allowing recorded footage to be stored locally for playback at a later time or offloaded to the cloud.


Customized Android BSP & Smart ETK

Included with the ALTA DS 2 system is an Android BSP (Board Support Package) customized for video monitoring applications which includes the following enhancements:

  • Storage – performance improvement
  • Hardware enabled decoding
  • RTSP & WVTP parse performance improvement
  • Hardware acceleration for on screen preview playback

To enable customers to shorten their development time and speed time to market for their specific application needs, the starter kit also includes the VIA Smart ETK (Embedded Tool Kit), which provides a set of APIs for applications to access I/O and manageability services provided by the system hardware.


VIA Video Management Software (VMS)

VIA VMS application framework provides basic functionality including HD playback support, hardware accelerated decoding for live streaming and local/network backup support.Video Streaming & Recording Performance

Live Stream: (Channels/Resolution/Bitrate) Playback Frame Rate/Stream Recording Performance
1ch 1080p @ 8Mbps 30fps 1Ch 1080p @8Mbps
4ch 720p @ 4Mbps 30fps 4Ch 1080p @8Mbps

Live Playback Layouts

VMS-Layout


Wireless IP Cameras

The starter kit includes 4 validated IP cameras featuring OmniVision’s OV9712 CameraChip™ sensor, developed with their proprietary OmniPixel3-HS™ high sensitivity pixel technology to provide excellent scene reproduction in both extremely high and low-light environments, and their OV788 video signal processor for video compression, 720p HD video streaming, and AES-256 encryption over any Wi-Fi network, the system offers ‘instant-on’ crisp HD video and streaming capabilities in an extremely power-efficient, battery operated package.

Which is related to the
April 8, 2015: OmniVision and VIA Announce Partnership to Develop Battery-Powered Wireless HD Video Monitoring Solution news release as well

Customizable Android™ Based Reference Design to Accelerate Time to Market, Optimize Home and Small Business Monitoring Systems

SANTA CLARA, Calif., April 6, 2015 — OmniVision Technologies Inc. (NASDAQ: OVTI), a leading developer of advanced digital imaging solutions, and VIA Technologies, Inc., a leader in embedded IoT and M2M platform innovation, today announced a partnership to develop a battery-powered high definition (HD) video monitoring solution that enables OEMs to dramatically reduce time-to-market for wireless multi-node monitoring systems in homes and small businesses.

“This partnership between OmniVision and VIA Technologies exemplifies both companies’ desire to meet the rapidly growing demand for turnkey solutions that can give OEMs the ability to quickly and cost-effectively bring innovative smart devices to market,” said Paul Gallagher, senior director of marketing at OmniVision. “By offering ‘instant-on’ crisp HD video and streaming capabilities in an extremely power-efficient, battery operated package, OmniVision’s OV9712 and OV788 video signal processor together provide excellent capabilities for the advanced solution now under development.”

“By combining OmniVision’s industry-leading imaging technologies with VIA’s advanced video processing technologies and embedded Android system design capabilities, we have produced a highly competitive turnkey solution,” said Epan Wu, head of VIA Embedded. “We look forward to collaborating with OmniVision and driving the development of new and innovative technologies for the rapidly growing market for home and commercial monitoring systems.”

Utilizing the OV9712 CameraChip™ sensor developed with OmniVision’s proprietary OmniPixel3-HS™ high sensitivity pixel technology, the solution will be designed to achieve excellent scene reproduction in both extremely high- and low-light environments. The OV9712 will operate in conjunction with OmniVision’s ultra-low power OV788 video signal processor. That processor will provide video compression, 720p HD video streaming, and AES-256 encryption over any Wi-Fi network, thus allowing users to quickly stream high quality video content using the video monitoring solution.

About OmniVision

OmniVision Technologies (NASDAQ: OVTI) is a leading developer of advanced digital imaging solutions. Its award-winning CMOS imaging technology enables superior image quality in many of today’s consumer and commercial applications, including mobile phones, notebooks, tablets and webcams, digital still and video cameras, security and surveillance, entertainment devices, automotive and medical imaging systems. Find out more at: www.ovt.com

Qualcomm’s alignment with latest developments in China via downsizing, Allwinner and Microsoft collaboration

July 22, 2015Qualcomm to cooperate with Microsoft, Allwinner for entry-level mobile device market by Digitimes Research

Qualcomm aims to ramp up its penetration in the entry-level mobile device market by cooperating with Microsoft to launch low-cost Windows Mobile 10 products, while also cooperating with Allwinner Technology to launch 3G/4G solutions for connected tablets, according to Digitimes Research.

Qualcomm accounted for about 80% of China’s 4G LTE solution market in 2014, but has seen its share decline significantly since the beginning of 2015 due to the roll-outs of competitive models from MediaTek and Spreadtrum Communications, and also due to Qualcomm’s own mishap in the deployment of mid-range and high-end solutions, Digitimes Research indicated.

To maintain its market share, Qualcomm’s cooperation with Microsoft aims to roll out Windows Mobile 10-based smartphones priced at about US$80 in the end-market, with the first wave of such models to be available in the fourth quarter of 2015.

The low-cost Windows Mobile 10-based models will utilize Qualcomm’s MSM8909 [Snapdragon 210] CPU, running on Windows Mobile platform but without the need of paying licensing fees to Microsoft, therefore, the overall cost of Windows Mobile10 smartphones will be comparable to entry-level Android phones.

Meanwhile, Allwinner will develop and offer total system solutions to support the development of cost-effective 4G LTE-enabled connected tablets based on Qualcomm’s Snapdragon family CPU products. Allwinner’s 4G solutions are for production of high-end tablets for mature market in the US and Europe, while the 3G solutions are for tablets targeting emerging markets.

July 23, 2015: a quote from Qualcomm Announces Record Third Quarter Fiscal 2014 Results Revenues $6.8 billion GAAP EPS $1.31, Non-GAAP EPS $1.44 press release by the company

China continues to present significant opportunities for us, particularly with the rollout of 4G LTE, but also presents significant challenges, as our business practices continue to be the subject of an investigation by the China National Development and Reform Commission (NDRC). Please refer to our Quarterly Report on Form 10-Q for the third quarter ended June 29, 2014 filed with the SEC for our most recent disclosures regarding the NDRC investigation.

We also believe that certain licensees in China currently are not fully complying with their contractual obligations to report their sales of licensed products to us (which includes certain licensees underreporting a portion of their 3G/4G device sales and a dispute with a licensee) and that unlicensed companies may seek to delay execution of new licenses while the NDRC investigation is ongoing. We expect calendar year 2014 3G/4G device shipments to be approximately 1.3 billion globally. However, our estimate of calendar year 2014 3G/4G device shipments that we currently expect to be reported to us is approximately 1.04 billion to 1.13 billion, which is adjusted for units that we believe may not be reported to us, are in dispute or are currently unlicensed. We are taking steps to address these issues, although the timing of any resolution is uncertain.

June 29, 2015: quote from Quarterly Report filed to SEC on Form 10-Q

Despite the resolution of the NDRC investigation, China continues to present significant challenges for us. We continue to believe that certain licensees in China are not fully complying with their contractual obligations to report their sales of licensed products to us (which includes 3G/4G units that we believe are not being reported by certain licensees). We continue to make progress, with licensees executing agreements based on the new China terms, and with several other licensees informing us that they intend to retain the terms of their existing agreements. Negotiations with certain other licensees are ongoing, and we expect it will take some time to conclude these negotiations. We believe that the conclusion of new agreements with these licensees will result in improved reporting by these licensees, including with respect to sales of three-mode devices (i.e., devices that implement GSM, TD-SCDMA, and LTE) sold in China. However, litigation and/or other actions may be necessary to compel licensees to report and pay the required royalties for sales they have not previously reported and to compel unlicensed companies to execute new licenses.

July 23, 2015Allwinner chosen to gain government support by DIGITIMES

China-based tablet SoC specialist Allwinner Technology has reportedly been selected as one of the target companies able to gain financial support from the central government, which has set up a national industry investment fund [the Rmb120 billion ($19.6 billion) National Integrated Circuit Industry Ivestment Found Ltd. 国家集成电路产业投资基金 set up on Oct 14, 2014 by the Chinese government and solely managed by Sino IC Capital] focusing on investing in the construction of advanced process capacity, semiconductor firm reorganization, and mergers.

Allwinner will use investment funds from the government to make itself more competitive, and contribute effectively to growth of the local IC industry and the self-sufficiency rate of ICs in China, said the sources.

With government support, Allwinner will also make strategic acquisitions locally and internationally, the sources indicated. Allwinner is likely to first merge with fellow company Rockchip Electronics to form a new, state-owned entity, which will gear up to tackle the market for IoT and wearable devices, the sources said.

Spreadtrum Communications was the first investment target chosen by the China government in the IC design industry. Spreadtrum is about to merge with RDA Microelectronics to establish a leading China-based SoC provider for smartphones as well as TVs, the sources noted.

July 22, 2015: Quotes from QUALCOMM (QCOM) Steven M. Mollenkopf on Q3 2015 Results – Earnings Call Transcript

  1. Full-time head count in QCT [Qualcomm CDMA Technologies] will be reduced by approximately 15%, which is in alignment with the overall company reductions. Our company resources are being realigned to our highest return businesses, and we’ll also make significant reductions in our temporary work force. Our team and organization will be streamlined. We will have fewer office locations overall, and we’ll shift some of our resources to lower-cost regions.
  2. We continue to see significant opportunities for growth in new areas outside of QTL [Qualcomm Technology Licensing] and QCT. While we are sharply focused on managing costs, we are not sacrificing the future for the present. We are taking a highly disciplined approach to our investments. We will invest in areas where we can apply our existing technology, such as small cells, or areas that are natural extensions of our capabilities, such as data centers.
  3. We have recently concluded the NDRC[China’s National Development and Reform Commission] investigation and announced several investments in China that position us well to grow our businesses in China going forward.
  4. With respect to the carrier aggregation question in China, China Telecom has already launched. It’s starting to work its way through the design cycle and through the ecosystem. China Mobile is expected to launch at the end of this calendar year. And we think this will be a good dynamic and has been anticipated in our roadmap, as you may know. The other dynamic that’s happening in China is just also is just the desire for the Chinese OEMs to be exporters, and that’s also been a good trend for us. But we’re looking forward to this carrier aggregation launch happening in China.
  5. We have identified networking, mobile computing, IoT, and automotive as the highest return areas and will focus our investments there. In fact, we continue to expand our investment in these growth areas. These areas have an addressable opportunity of more than $10 billion today. Based on a mix of third-party estimates and our own forecasts, the serviceable addressable opportunity for these four areas is expected to double by 2020 to more than $20 billion.
  6. The current industry environment has seen OEM share shift in the highly profitable premium tier, where the top player continues to take share and where, according to IDC, the top two manufacturers together now have more than 85% share of premium tier shipments. The current product cycle also has seen certain OEMs pursue vertically integrated strategies at increased levels compared to the past. These developments along with other product cycle issues are currently impacting our business.
  7. We are guiding to a 45 million unit sequential decline in MSM shipments. This decline is explained by two factors. First, our previous guidance expected MSMs to be down sequentially by 10 million to 15 million units in the fourth quarter. And the addition of 5 million units into the third fiscal quarter brings the anticipated impact closer to 20 million units. Second, the remaining approximately 25 million unit reduction is largely explained by the premium tier developments I explained a few minutes ago.

July 22, 2015: excerpt from the Third Quarter Fiscal 2015 Earnings Executive presentation
Qualcomm MSM Chip shipments -- 2011-12-13-14-15

June 2, 2015Qualcomm and Leading Tablet Solutions Provider Allwinner Technology to Collaborate in Growth of 4G LTE Tablets Powered by Qualcomm Snapdragon Processors news release by the company

—Allwinner to offer entry-level 4G LTE-enabled tablet system solutions based on Snapdragon 410 and 210 processors—

Qualcomm Technologies, Inc. (QTI), a subsidiary of Qualcomm Incorporated (NASDAQ: QCOM), and Allwinner Technology, Co. Ltd, today announced that they will be collaborating to further extend QTI’s Snapdragon processors into the connected tablet segment which is experiencing strong growth. QTI will be expanding its ability to serve the Chinese tablet design and manufacturing ecosystem by working with Allwinner, which will be offering system solution services for those OEMs and ODMs creating 4G LTE-enabled tablets powered by Qualcomm® Snapdragon™ 410 and 210 processors of QTI.

Allwinner, a China-based fabless semiconductor company and a leading provider of total system solutions for the Android tablet ecosystem, will support the quick and cost-effective development of 4G LTE-enabled tablets based on the aforementioned Snapdragon processors for domestic sales and export worldwide. Through the use of its established channel of support and services for the Chinese ecosystem of independent design houses, Allwinner will help expedite commercial deployment of high-quality, cost-effective 4G LTE-enabled tablets featuring QTI’s Snapdragon 410 and 210 processors.

Shared highlights of the Snapdragon 410 and 210 processors:

  • 4G LTE Global Mode, with 7 mode support (LTE FDD, LTE TDD, WCDMA, TD-SCDMA, EV-DO, CDMA 1x, GSM/EDGE)
  • LTE-Broadcast and Dual SIM technology
  • Superior camera capabilities and leading enhanced computational camera functionalities, including Zero Shutter Lag, high dynamic range (HDR), autofocus, auto white balance and auto exposure.
  • Support for the Android™ Lollipop mobile operating system
  • Support for QTI’s Qualcomm® Quick Charge™ 2.0 technology, which is designed to support up to 75% faster battery charging than devices without fast-charging technology.

The Snapdragon 410 processor is designed additionally to support features such as:

  • A quad-core ARM® Cortex™ A53 running up to 1.4 GHz per core and a Qualcomm® Adreno™ 306 GPU by QTI
  • Cat 4 speeds of up to 150 Mbps
  • Up to 13 Megapixel Camera
  • 1080p Full HD video playback at 1280×800 resolutions

The Snapdragon 210 [MSM8909] processor is designed to additionally support features such as: 

  • [up to 1.1 GHz quad-core ARM® Cortex™ A7 CPUs]
  • Integrated X5 modem, 4G LTE-Advanced Cat 4 Carrier Aggregation, LTE Broadcast and LTE Dual SIM/Dual Standby — all firsts in this category of products
  • Enhanced performance and power efficiency in the entry-level tier with quad CPUs and Qualcomm Adreno 304 graphics
  • Up to 8 Megapixel Camera
  • 720p HD playback and H.265 (hardware HEVC)

“Qualcomm Technologies’ industry leading Snapdragon processors, combined with Allwinner’s China tablet ecosystem relationships, represents a strong collaboration of proven industry leaders,” said Oliver Tang, executive vice president of Allwinner Technology Co. Ltd.  “We’re pleased to be working with Qualcomm Technologies to help drive further growth in connected tablets, and we expect to see a wave of high-volume, diversely designed, compellingly priced and high-quality 4G LTE-enabled tablets powered by Snapdragon processors in 2015.

“By working with Allwinner, we will be helping manufacturers to further utilize our industry leading processing and connectivity technologies to deliver high-quality consumer devices at great value,” said Cristiano Amon, executive vice president, Qualcomm Technologies, Inc., and co-president, QCT. “Our relationship with Allwinner will continue to help expedite the development and deployment of Snapdragon-enabled 4G LTE connected devices.”

February 9, 2015: Qoutes from Qualcomm and China’s National Development and Reform Commission Reach Resolution press release by the company

– NDRC Accepts Qualcomm’s Rectification Plan –

  • For licenses of Qualcomm’s 3G and 4G essential Chinese patents for branded devices sold for use in China, Qualcomm will charge royalties of 5% for 3G devices (including multimode 3G/4G devices) and 3.5% for 4G devices (including 3-mode LTE-TDD devices) that do not implement CDMA or WCDMA, in each case using a royalty base of 65% of the net selling price of the device.
  • Qualcomm will give its existing licensees an opportunity to elect to take the new terms for sales of branded devices for use in China as of January 1, 2015.

In addition, the NDRC imposed a fine on the Company of 6.088 billion Chinese Yuan Renminbi (approximately $975 million at current exchange rates), which Qualcomm will not contest. Qualcomm will pay the fine on a timely basis as required by the NDRC.

  • Expanding Qualcomm’s longstanding relationship with Semiconductor Manufacturing International Corporation (SMIC), one of China’s largest and most advanced semiconductor foundries, which has led to SMIC’s major milestone of producing high-performance, low-power mobile processors using cutting-edge advanced 28nm technology.
  • Creating a China-specific investment fund of $150 million to further the development of mobile and semiconductor technologies, including initial investments from the fund in five innovative Chinese companies.

February 25, 2015: Government-led investment funds to drive China IC design growth by Digitimes Research

China’s government policies for supporting the local IC design industry have put less emphasis on intervention measures such as offering tax breaks, providing direct financial support, and making purchases of domestic products, while shifting their focus to the establishment of investment funds, according to a recent Digitimes Research Special Report.

The report, titled 2015 China IC design market forecast, notes that investment funds will be set up by not only China’s central government, but also local governments, aiming to foster the development of the local IC design industry. The government-led funds will play an important role in driving the industry growth during the nation’s 13th Five-Year Plan period (2016-2020), Digitimes Research said.

The No. 18 Document of China’s State Council already gave strong support to IC companies with tax incentives, direct financial assistance and government purchases of domestic products, Digitimes Research suggested. Between 2001 and 2010, the number of China-based IC foundries grew to nine companies from four, while the number of IC design firms increased rapidly to 479 companies from 98.

The No. 4 Document announced by China’s State Council in 2011 showed that tax incentives awarded to the local IC companies have been narrowed significantly. The move indicates a change in government policies for supporting the local IC industry.

The Dawn of the SoC 2.0 Era: The TSMC Perspective

From its companion post The Dawn of the SoC 2.0 Era: The ARM Perspective

futureICT - Cortex-A Roadmap Strategy -- April-2015

Source of the slide: ARM Cortex系列核心介绍 (Core ARM Cortex Series Introduction, 52RD, April 13, 2015)

Regarding TSMC itself the April 8 conclusion in TSMC Outlines 16nm, 10nm Plans article by EE|Times is:

“It’s not completely clear who is ahead at 16/14 but I think TSMC is making a major commitment to trying to be ahead at 10,” Jones said. “If that happens and TSMC has closed the gap with Intel, the issue is then if TSMC’s 10 and Intel’s 10 are the same,” he said.

Background from the April 14, 2015 TSMC Symposium: “10nm is Ready for Design Starts at This Moment” article in Cadence Communities Blog:

The 10nm semiconductor process node is no longer in the distant future – it is here today, according to presenters at the recent TSMC 2015 Technology Symposium in San Jose, California. TSMC executives noted that EDA tools have been certified, most of the IP is ready or close to ready, and risk production is expected to begin in the fourth quarter of 2015.

Here are some more details about 10nm at TSMC as presented in talks by Dr. Cliff Hou, vice president of R&D at TSMC (right), and Dr. BJ Woo, vice president of business development at TSMC (below left). At the TSMC Symposium, speakers also introduced two new process nodes, 16HHC and 28HPC+ (see blog post here).

According to Woo, TSMC is not only keeping up with Moore’s Law – it is running ahead of the law with its 10FF offering. “We have done a lot more aggressive scaling than Moore’s Law demands for our 10nm technology,” she said. A case in point is the fully functional 256Mb SRAM with a cell size that is approximately 50% smaller than the 16FF+ cell size. She called this an “exceptional shrink ratio” that goes beyond traditional scaling.

And it’s not just SRAM. The 10FF node, Woo said, can scale key pitches by more than 70%. Combine that with innovative layout, and 10nm can achieve almost 50% die size scaling compared to 16FF+. “And this is very, very aggressive,” she said.

After noting that the 16FF+ already provides “clear performance leadership,” Woo said that 10FF offers a 22% performance gain over 16FF+ at the same power, or more than 40% power reduction at the same speed. This comparison is based on a TSMC internal ring oscillator benchmark circuit. For the Cortex-A57 test chip used to validate EDA tools, the result was a 19% speed increase at the same power, and a 38% power reduction at the same speed.

New features in 10FF include a unidirectional (1D) layout style and new local interconnect layer. These features help 10FF achieve a 2.1X logic density improvement over 16FF+, whereas normally TSMC gets about a 1.9X density boost for node migration, Woo said. In addition to the density improvement, the 1D Mx architecture can reduce CD (critical dimension) variation by 60%, she said.

And an already remarkable quote from April 12, 2015 TSMC Symposium: New Low-Power Process, Expanded R&D Will Drive Vast Innovation: TSMC Executive article in Cadence Communities Blog:

Hock Tan, CEO of Avago, described a symbiotic relationship between TSMC and his company that led to a super high-density switch for a networking customer, implemented in 16FF+. The switch has 96 ports, each running 100G Gbps, and drawing less than 2W each. That enables, in a next-generation data center, the tripling of a switch performance to more than 10 Tbps.

Moreover, according to the April 12, 2015 TSMC Symposium: New 16FFC and 28HPC+ Processes Target “Mainstream” Designers and Internet of Things (IoT) article from Cadence Communities Blog:

16FFC is a “compact” version of the 16nm FinFET+ (16FF+) process technology that is now in risk production at TSMC. It claims advantages in power, performance, and area compared to the existing 16FF+ process, along with easy migration from 16FF+. It can be used for ultra low-power IoT applications such as wearables, mobile, and consumer.

28HPC+ is an improved version of the 28HPC (High Performance Compact) process, which is itself a fairly recent development. Late last year 28HPC went into volume production, and it provides a 10% smaller die size and 30% power reduction compared to TSMC’s earlier 28LP process. 28HPC+ ups the ante by providing 15% faster speed at the same leakage, or 30-50% reduction in leakage at the same speed, compared to 28HPC.

TSMC also provided updates on other processes on its roadmap, which includes the following:

  • High Performance – 28HP, 28HPM, 20SoC, 16FF+
  • Mainstream – 28LP, 28HPC, 28HPC+, 16FFC
  • Ultra Low Power – 55ULP, 40ULP, 28ULP, 16FFC (16FFC is in both mainstream and low power categories)

In connection with that remember the September 29, 2014 announcement:
TSMC Launches Ultra-Low Power Technology Platform for IoT and Wearable Device Applications

TSMC (TWSE: 2330, NYSE: TSM) today announced the foundry segment’s first and most comprehensive ultra-low power technology platform aimed at a wide range of applications for the rapidly evolving Internet of Things (IoT) and wearable device markets that require a wide spectrum of technologies to best serve these diverse applications. In this platform, TSMC offers multiple processes to provide significant power reduction benefits for IoT and wearable products and a comprehensive design ecosystem to accelerate time-to-market for customers.

TSMC’s ultra-low power process lineup expands from the existing 0.18-micron extremely low leakage (0.18eLL) and 90-nanometer ultra low leakage (90uLL) nodes, and 16-nanometer FinFET technology, to new offerings of 55-nanometer ultra-low power (55ULP), 40ULP and 28ULP, which support processing speeds of up to 1.2GHz. The wide spectrum of ultra-low power processes from 0.18-micron to 16-nanometer FinFET is ideally suited for a variety of smart and power-efficient applications in the IoT and wearable device markets. Radio frequency and embedded Flash memory capabilities are also available in 0.18um to 40nm ultra-low power technologies, enabling system level integration for smaller form factors as well as facilitating wireless connections among IoT products.

Compared with their previous low power generations, TSMC’s ultra-low power processes can further reduce operating voltages by 20% to 30% to lower both active power and standby power consumption and enable significant increases in battery life — by 2X to 10X — when much smaller batteries are demanded in IoT/wearable applications.

“This is the first time in the industry that we offer a comprehensive platform to meet the demands and innovation for the versatile Internet of Things market where ultra-low power and ubiquitous connectivity are most critical,” said TSMC President and Co-CEO, Dr. Mark Liu. “Bringing such a wide spectrum of offerings to this emerging market demonstrates TSMC’s technology leadership and commitment to bring great value to our customers and enable design wins with competitive products.”

One valuable advantage offered by TSMC’s ultra-low power technology platform is that customers can leverage TSMC’s existing IP ecosystem through the Open Innovation Platform®. Designers can easily re-use IPs and libraries built on TSMC’s low-power processes for new ultra-low power designs to boost first-silicon success rates and to achieve fast time-to-market product introduction. Some early design engagements with customers using 55ULP, 40ULP and 28ULP nodes are scheduled in 2014 and risk productions are planned in 2015.

“TSMC’s new ultra-low power process technology not only reduces power for always-on devices, but enables the integration of radios and FLASH delivering a significant performance and efficiency gain for next-generation intelligent products,” said Dr. Dipesh Patel, executive vice president and general manager, physical design group, ARM. “Through a collaborative partnership that leverages the energy-efficient ARM® Cortex®-M and Cortex-A CPUs and TSMC’s new process technology platform, we can collectively deliver the ingredients for innovation that will drive the next wave of IoT, wearable, and other connected technologies.”

“Low power is the number one priority for Internet-of-Things and battery-operated mobile devices,” said Martin Lund, Senior Vice President and General Manager of the IP Group at Cadence. “TSMC’s new ULP technology platform coupled with Cadence’s low-power mixed-signal design flow and extensive IP portfolio will better meet the unique always-on, low-power requirements of IoT and other power sensitive devices worldwide.”

CSR has an unequalled reputation in Bluetooth technology and has been instrumental in its progression, including helping to write the Bluetooth Smart standard that is meeting the demands of today’s rapidly evolving consumer electronics market,” said Joep van Beurden, CEO at CSR. “For many years, CSR has closely collaborated with TSMC, and we are pleased to demonstrate the results of that collaboration with the adoption of the 40ULP platform for our next generation of Bluetooth Smart devices including products for markets like smart home, lighting and wearables that are enabling the growth of the Internet of Things. Our solutions simplify complex customer challenges and help speed their time to market by allowing them to design and deliver breakthrough low power wireless connected products on these powerful new platforms.”

“The imaging SoC solutions of Fujitsu Semiconductor Limited bring the best balance between high imaging quality and low power consumption, to meet the significant demand from our customers and the electronics market,” said Tom Miyake, Corporate Vice President, at System LSI Company of Fujitsu Semiconductor Limited. “We welcome that TSMC is adding the 28ULP technology to its successful 28nm platform. We believe this technology will provide our SoCs with the key feature: low power consumption at low cost.”

Nordic Semiconductor has been a pioneer and leader in ultra-low power wireless solutions since 2002, and with the launch of its nRF51 Series of Systems-on-Chip (SoCs) in 2012 the company established itself as a leading vendor of Bluetooth Smart wireless technology,” said Svenn-Tore Larsen, CEO of Nordic Semiconductor. “We have been collaborating closely with TSMC on the selection of process technology for our upcoming nRF52 Series of ultra-low power RF SoCs. I am happy to announce that we have selected the TSMC 55ULP platform. This process is a key enabler for us to push the envelope on power consumption, performance and level of integration of the nRF52 Series to meet the future requirements of Wearable and Internet of Things applications.”

“Built on TSMC’s Ultra-Low Power technology platform and comprehensive design ecosystem, Realtek’s Bluetooth Energy Efficient smart SoC, BEE, supports the latest Bluetooth 4.1 specification featuring Bluetooth Low Energy (BLE) and GATT-based profiles,” said Realtek Vice President and Spokesman, Yee-Wei Huang. “BEE’s power efficient architecture, low power RF, and embedded Flash are ideal both for the IoT and for wearable devices such as smart watches, sport wristbands, smart home automation, remote controls, beacon devices, and wireless charging devices.”

Silicon Labs welcomes TSMC’s ultra-low power initiative because it will enable a range of energy-friendly processing, sensing and connectivity technologies we are actively developing for the Internet of Things,” said Tyson Tuttle, Chief Executive Officer, Silicon Labs. “We look forward to continuing our successful collaboration with TSMC to bring our solutions to market.”

“Synopsys is fully aligned with TSMC on providing designers with a broad portfolio of high-quality IP for TSMC’s ultra-low power process technology and the Internet of Things applications,” said John Koeter, Vice President of Marketing for IP and Prototyping at Synopsys. “Our wide range of silicon-proven DesignWare® interface, embedded memory, logic library, processor, analog and subsystem IP solutions are already optimized to help designers meet the power, energy and area requirements of wearable device SoCs, enabling them to quickly deliver products to the market.”

As well as the ARM and Cadence Expand Collaboration for IoT and Wearable Device Applications Targeting TSMC’s Ultra-Low Power Technology Platform announcement of Sept 29, 2015:

ARM® and Cadence® today announced an expanded collaboration for IoT and wearable devices targeting TSMC’s ultra-low power technology platform. The collaboration will enable the rapid development of IoT and wearable devices by optimizing the system integration of ARM IP and Cadence’s integrated flow for mixed-signal design and verification, and their leading low-power design and verification flow.

The partnership will deliver reference designs and physical design knowledge to integrate ARM Cortex® processors, ARM CoreLink™ system IP, and ARM Artisan® physical IP along with RF/analog/mixed-signal IP and embedded flash in the Virtuoso®-VDI Mixed-Signal Open Access integrated flow for the new TSMC process technology offerings of 55ULP, 40ULP and 28ULP.

“TSMC’s new ULP technology platform is an important development in addressing the IoT’s low-power requirements,” stated Nimish Modi, senior vice president of Marketing and Business Development at Cadence. “Cadence’s low-power expertise and leadership in mixed-signal design and verification form the most complete solution for implementing IoT applications. These flows, optimized for ARM’s Cortex-M processors including the new Cortex-M7, will enable designers to develop and deliver new and creative IoT applications that take maximum advantage of ULP technologies.”

“The reduction in leakage of TSMC’s new ULP technology platform combined with the proven power-efficiency of Cortex-M processors will enable a vast range of devices to operate in ultra energy-constrained environments,” said Richard York, vice president of embedded segment marketing, ARM. “Our collaboration with Cadence enables designers to continue developing the most innovative IoT devices in the market.”

This new collaboration builds on existing multi-year programs to optimize performance, power and area (PPA) via Cadence’s digital, mixed-signal and verification flows and complementary IP alongside ARM Cortex-A processors and ARM POP™ IP targeting TSMC 40nm, 28nm, and 16nm FinFET process technologies. Similarly, the companies have been optimizing the solution based around the Cortex-M processors in mixed-signal SoCs targeting TSMC 65/55nm and larger geometry nodes. The joint Cortex-M7 Reference Methodology for TSMC 40LP is the latest example of this collaboration.

For the above keep in mind The TSMC Grand Alliance [TSMC, Dec 3, 2013]:

The TSMC Grand Alliance is one of the most powerful force for innovation in the semiconductor industry, bringing together our customers, EDA partners, IP partners, and key equipment and materials suppliers at a new, higher level of collaboration.

The objectives of the TSMC Grand Alliance are straightforward: to help our customers, the alliance members and ourselves win business and stay competitive.

We know collaboration works. We have seen it in the great strides our customers and ecosystem members have made through the Open Innovation Platform® where today there are 5,000 qualified IP macros and over 100 EDA tools that supports our customers’ innovation and helps them attain maximum value from TSMC’s technology.

Today Open Innovation Platform is an unmatchable design ecosystem and a key part of the Grand Alliance that will prove much more powerful. Looking at R&D investment alone, we calculate that TSMC and ten of our customers invest more in R&D than the top two semiconductor IDMs combined.

Through the Grand Alliance TSMC will relentlessly pursue our mission and collaborate with customers and partners. We need each other to be competitive. We need each other to win. Such is the power of the Grand Alliance.

[Some more information is in the very end of this post]

A related overview in Kicking off #ARMWearablesWK with an analysts view of the market post of November 17, 2014 of ARM Connected Community blog by David Blaza:

Today as we kickoff ARM Wearables Week we hear from Shane Walker of IHS who is their Wearables and Medical market expert.

Shane’s take on this market is that it’s for real this time (there was a brief Smartwatch wave a few years ago) and will continue to be a hot growth sector through 2015. One of the great benefits of talking with analysts like Shane is they help you think through what’s going on and bust a few myths that may have found their way into our thinking. For example I asked Shane what the barriers to growth were and he carefully and patiently pointed out that Wearables are growing at a 21% CAGR already and will hit $12b in device sales this year (without services, more on that later in the week).  So this is not an emerging or promising market, it’s here and growing at an impressive rate. By 2019 Shane’s estimate is that it will hit $33.5b in device sales and services are increasingly going to factor into the wearables experience (Big Data is coming!).

Shane breaks the Wearables market down to 5 major categories:

  1. Healthcare and Medical
  2. Fitness and Wellness
  3. Infotainment
  4. Industrial
  5. Military

I’m glad he did this for me because wearables are incredibly diverse and this week you are going to see some category defying products here such as smart Jewelry where does that fit?

Below you can see a table chart that Shane was willing to share that shows his estimate for market size and units sold, the main learning for me is how much of this market is healthcare related. Also attached below are details on what services IHS offer in the Wearables market or you can find them here.

futureICT - World Market for Wearable Technology - Revenue by Application -- IHS-November-2014

attached is: Wearable Technology Intelligence Service 2014.pdf  [IHS Technology, November 17, 2014]

Note the following table in that:
futureICT - Wearable Technology Data Coverage Areas by IHS

More information:
– A Guide to the $32b Wearables Market [IHS Technology, March 11, 2015]
– which has a free to download whitepaper:
Wearable Technology: The Small Revolutions is Making Big Waves

Brief retrospective on the SoC 1.0 Era

futureICT - Shipments of TSMC Advanced Technologies Q1'2009 - Q1'2015

Detailed Background from TSMC’s quaterly calls

Q1 2015:

Mark Liu – TSMC – President & Co-CEO
[update on new technology]

The continuous demand of more functionality and integration in smartphones drives for more silicon content. We expect smartphones will continue to drive our growth in the next several years.

In the meantime, we see IoT appears us — present us new growth opportunities. The proliferation of IoT not only will bring us growth in the sensor, connectivity and advanced packaging areas, the associated application and services, such as big data analytics, will also further our growth in the computation space, including application processor, network processor, image processor, graphic processor, microcontroller and other various processors. That was the long-term outlook.

I’ll update some of our 10-nanometer development progress. Our 10-nanometer technology development is progressing well. Our technology qualification remains in Q4 this year.

Recently we have successfully achieved fully functional yields of our 256-megabit SRAM. Currently we have more than 10 customers fully engaged with us on 10-nanometer. We still expect to have 10-nanometer volume ramp in fourth quarter 2016 and to contribute billing in early 2017.

This technology adopts our third-generation FinFET transistor and have scaling more than one generation. Its price is fully justified by its value for various applications, including application processor, baseband SoC, network processor, CPU and graphic processors. Its cost and price ratio will comply to our structural profitability considerations.

As for new technology development at TSMC, I’d like to start with — to update you our 7-nanometer development. We have started our 7-nanometer technology development program early last year. We also have rolled out our 7-nanometer design and technology collaboration activity with several of our major customers. Our 7-nanometer technology developments today are well in progress.

TSMC’s 7-nanometer technology will leverage most of the tools used in 10-nanometer, in the meantime achieve a new generation of technology value to our customers. The 7-nanometer technology risk production date is targeted at early 2017.

Now I would like to give you an update on EUV. We have been making steady progress on EUV. Both our development tools, we have two NXE 3300 have been upgraded to the configuration of 80 watt of EUV power, with an average wafer throughput of a few hundred wafers per day. We continue to work with ASML to improve tool stability and availability. We also are working with ASML and our partners on developing the infrastructure of EUV, such as masks and resists.

Although today the process on record of both 10-nanometers and 7-nanometer are on immersion tools, with innovative multiple patterning techniques, we will continue to look for opportunity to further reduce the wafer cost and simplify the process flow by inserting EUV layer in the process.

Now I’d like to give you an update of our recently announced ultra-low-power technologies. We have offered the industry’s most comprehensive ultra-low-power technology portfolio, ranging from 55-nanometer ULP, 40-nanometer ULP, 28-nanometer ULP, to the recently announced 16 FFC, a compact version of 16 FinFET Plus, enable continual reduction of operating voltage and power consumption. Today more than 30 product tape-outs planned in 2015 from more than 25 customers.

This 55- and 40-nanometer ULP will be the most cost-effective solution for low- to mid-performance wearable and IoT devices. The 28 ULP and 16 FFC will be the most power-efficient solution for high-performance IoT applications. In particular, our 16 FFC offers the ultra-low-power operation at a supply voltage of 0.55 volts, with higher performance than all of the FD-SOI technologies marketed today.

Lastly I’ll give you an update of our recent IoT specialty technology development. We have developed the world’s first 1.0-micron pixel size 16-megapixel CMOS image sensor, with stacked image signal processor, which was announced in March by our customer for the next-generation smartphone. Secondly, we continue to drive the best low resistance in BCD [Bipolar-CMOS-DMOS for DC-to-DC converter: together with Ultra-High-Voltage (UHV) technology for AC-to-DC converter—are the key to enable monolithic integrated PMIC design] technology roadmap, from 0.18 micron to 0.13 micron and from 8-inch to 12-inch production for wireless charging and fast wired charging of mobile devices. We continue to extend our 0.13 BCD technology from consumer and industrial applications to automotive-grade electrical system control applications.

Lastly, recently we have started production in foundry’s first 40-nanometer industrial embedded Flash technology that was started from November last year. And this technology recently passed automotive-grade qualification, that was in March, for engine control applications.

C.C. Wei – TSMC – President & Co-CEO

I will update you the 28-nanometer, 20 and 16 FinFET status and also our InFO business.

First, 28-nanometer. This is the fifth year since TSMC’s 28-nanometer entered mass production. 28-nanometer has been a very large and successful node for us. Our market segment share at this node has held up well and is in the mid-70s this year. We expect this to continue in year 2016. In comparison, this is better than what we had in the 40-nanometer node.

The demand for 28-nanometer is expected to grow this year due to the growth of mid- and low-end smartphones and as well as the second-wave segment, such as radio frequency, circuit product and the Flash controllers that migrate into this node.

However, due to some customers’ inventory adjustments, which we believe is only going to be for the short term, the demand for 28-nanometer in the second quarter will be lower than our previous quarter, resulting in 28-nanometer capacity utilization rate to be in the high-80s range. But we expect the utilization rate of the 28-nanometer to recover soon and to be above 90% in the second half of this year.

While we are in the mass production, we also continue to improve the performance of our technology. Last year we have introduced our 28-HPC, which is a compact version of 28-HPM. For the purpose of helping 64-bit CPU conversion for mid- to low-end market, this year we further improved the 28-HPC to 28-HPC Plus. For comparison, 28-HPC Plus will have 18% power consumption — lower power consumption at the same speed or 15% faster speed at the same kind of power.

As for the competitive position, we are confident that we will continue to lead in performance and yield. So far we do not see there is a very much effective capacity in High K metal gate at 28-nanometer outside TSMC. And since we have already shipped more than 3m 12-inch 28-nanometer wafers, the learning curve has given us an absolute advantage in cost.

Now let me move to our 20 SoC. TSMC remains the sole solution provider in foundry industry for 20-nanometer process. Our yield has been consistently good after a very successful ramp last year. But recently we have observed customers’ planned schedule for product migration from 20 nanometer to 16 FinFET started sooner than we forecasted three months ago.

As a result, even we continue to grow 20-nanometer business in the second quarter of this year, our earlier forecast of 20-nanometer contributing above 20% of total wafer revenue this year has to be revised down by a few points to a level about the mid teens. That being the case, we still forecast the revenue from 20-nanometer will more than double that of year 2014’s level.

Now 16 FinFET. The schedule for 16 FinFET high-volume production remains unchanged. We will begin ramping in the third quarter this year. And the ramp rate appeared be faster than we forecasted three months ago, thanks to the excellent yield learning that we can leverage our 20-nanometer experience and also due to a faster migration from 20-nanometer to 16 FinFET.

In addition to good yield, our 16 FinFET device performance also met all products’ specs due to our very good transistor engineering. So we believe our 16 FinFET will be a very long-life node due to its good performance and the right cost. This is very similar to our 28-nanometer node.

We are highly confident that our 16 FinFET is very competitive. As we’ve said repeatedly, combining 20-nanometer and 16-nanometer, we will have the largest foundry share in year 2015. And if we only look at 16-nanometer alone, we still can say TSMC will have the largest 16- or 14-nanometer foundry share in year 2016.

Now let me move to our InFO business update. The schedule to ramp up the InFO in second quarter next year remains unchanged. We expect InFO will contribute more than $100m quarterly revenue by next year, fourth quarter next year, when it will be fully ramped.

Right now we are building a new facility in Longtan, that’s a city very near to Hsinchu, where our headquarters are, for ramping up InFO. Today a small product line is almost complete and it’s ready for early engineering experiment. This pilot line will be expanded to accommodate the high-volume ramp in year 2016.

Andrew Lu – Barclays – Analyst

… I think Mark presented at the Technology Symposium in San Jose mentioned that 16 FinFET versus competing technology is about 10% performance better. So can you elaborate what’s 10% performance better? If our die size is larger than our competitors, how can we get the 10% performance better?

Mark Liu – TSMC – President & Co-CEO

In the conference we talked about 16 FinFET Plus. That is our second-generation FinFET transistor. In that we improved our transistor performance a great deal. According to our information, that transistor speed, talk about speed at fixed power, is higher than the competitor by 10%. That’s what I meant. …  Because of the transistor structure, transistor engineering.

Andrew Lu – Barclays – Analyst

Compared to competing — is the competing the current competitor’s solution or the next-generation competitor’s solution? For example, LPE versus LPP or something like that?
Mark Liu – TSMC – President & Co-CEO
The fastest one. The fastest.
Andrew Lu – Barclays – Analyst
Their best one?
Mark Liu – TSMC – President & Co-CEO
Yes.

Dan Heyler – BofA Merrill Lynch – Analyst

My second question is relating to 20-nanometer. Here you certainly have a lot of growth in 16, with customers taping out aggressively, especially next year. Given your high share at 28, how do you keep 28 full? You obviously have a lot of technology there. Customers will move forward.

So I’m wondering, could you elaborate on new areas that are actually creating new demand at 28, such that you can continue to grow 28 next year. And do you think you can grow? I think previously you said maybe hold it at current levels even with 16 growing. So just maybe revisit that question.

C.C. Wei – TSMC – President & Co-CEO

To answer the question, I think the high-end smartphone will move to 16 FinFET. However, the mid- to — and lower-end smartphones will stay in the 28-nanometer because that’s very cost effective. And mid- and low-end smartphone continues to grow significantly. So that will give a very strong demand on 28-nanometer. In addition, we still have a second-wave product, like RF and Flash controller, as I use as an example, move into 28-nanometer.

So summing it up, I think the 28-nanometer’s demand continue to grow while we move into the 16 FinFET for high-end smartphone.

Michael Chou – Deutsche Bank – Analyst

As Mark has highlighted your EUV program, Does that imply you may consider using EUV in the second stage of your 16-nanometer — 10-nanometer ramp-up, potentially in 2018 or 2019? 

Mark Liu – TSMC – President & Co-CEO

Yes, we always look for opportunity to insert EUV in both 10-nanometer and 7-nanometer. The EUV technology provides not only some cost benefit, but also simplify the process. That means you can replace multiple layers with one layer that helps your yield improvement. So there’s opportunity both in quality and cost always exist so long as EUV’s productivity comes to the threshold point.

And in — as you noticed on 10-nanometer, our capacity build will largely done in 2016 and 2017. So 2018 will be inserted, if inserted, will be combined with some other tools upgrade, some tool upgrade to 7, for example, and replaced by the EUV tools. In that node it will not be a fresh capacity build with EUV at that time because that’s a little bit late in the schedule for the 10.

7-nanometer, of course it will be higher probability adopting EUV. And the benefit will be bigger because the 7-nanometer has a lot of multiple layers, quadruple, even multiple patterning layers, thus EUV can be more effective in reducing the cost and improve the yield, for example. So that’s our current status.

But today EUV is still in the engineering mode. The productivity, as you heard, will still have some gaps for practical insertion of the technology. So we’re still working on that, in that mode. And we have — although we have one-day performance up to 1,000 wafer per day, but I was talking about average still a few hundreds. And we need to get to more than 1,000 to consider a schedule to put it into the production.

Randy Abrams – Credit Suisse – Analyst

As you go to fourth quarter, how broad is the customer base? Is it a single key product or are you seeing broadening out of 16 FinFET as you ramp that in fourth quarter?

Mark Liu – TSMC – President & Co-CEO

… As for the second half, we think, first of all, the inventory adjustment will largely complete towards the end of second quarter.

We think the end market of smartphone is still healthy growth this year. Therefore the second half will resume the growth. And, more importantly, our 16 FinFET technology will start to ramp in the second half. So that will contribute a lot of growth, more than the 20-nanometer shipment reduction. So those two factors.

Roland Shu – Citigroup – Analyst

My first question is on given the fast ramp of 16-nanometer, so are we going to see meaningful revenue contribution for 16 in 3Q?

C.C. Wei – TSMC – President & Co-CEO

We ramp up in third quarter this year, but it’s many layers of process, plus about one month is back-end. So in 3Q we expect just the revenue just very minimum.

Bill Lu – Morgan Stanley – Analyst

This is a follow-up to Randy’s question. But I’m going to go over some numbers with you first before I ask the question, which is we did the math. I don’t think these are exactly right. But over the last five years we’ve got IDM zero growth, fabless 8%, but system houses above 20%, right. So system houses, I’m excluding memory, just the system LSI, the logic portion. I think that might be slightly conservative.

Now that’s a pretty big change. And I’m wondering how you should think about that, how you should — if you look at TSMC addressing the system houses versus the fabless customers, if you look at, for example, your market share, if you look at your margin for the system houses versus the fabless, how do you think about that?

Mark Liu – TSMC – President & Co-CEO

Yes. Indeed, in the past five years the system houses sourcing and foundry business to us has a much higher growth rate, as you quoted. But remember, that came from a very small base. Okay? But we welcome system house sourcing because we consider them are fabless too, fabless companies, the companies without fabs, bring business to us.

It’s not necessarily the margin has to do with what type of company sourced. It has to do with our value to that company and also the size, the size of the business. If the business is bigger, of course the — we probably can enjoy a slightly — a little bit better price. So it depends on the size of the business, less dependent on what company, system company or non-system company’s business.

Steven Pelayo – HSBC – Analyst

For the last three years or so, TSMC’s been growing 20%, 30% year-on-year revenue growth rates. First quarter 50% year on year. But to Bill’s question there, it does look like in the second half of the year, if I play around with your full-year guidance and what you’re doing, low single-digit year-on-year growth rates. And if we exclude maybe 16-nanometer, above 16-nanometer, maybe it’s flat to down. Is that the new industry? What are we talking now for industry growth rates for both the semi industry and in the foundry market this year?

90 days ago you suggested the semi market was going to grow 5% this year with foundries growing 12%. In light of your new guidance, in light of what it looks like you’re going to have very slight year-on-year growth rates in the second half of the year, what do you think that means for the overall industry?

Mark Liu – TSMC – President & Co-CEO

We think the semiconductor growth this year currently is indeed we adjusted down from 5% earlier to 4% at this time. Yes. We think it’s really due to the macroeconomic situation around the world today. And therefore the foundry market — foundry growth rate will adjusted down too. We are looking at about 10% range. So that’s why we revised our view on the current semiconductor growth.

Brett Simpson – Arete Research – Analyst

My question on 10-nanometer, I know it’s still 18 months away from ramp-up, but can you talk about how fast this ramp might scale relative to 20-nanometer or 28-nanometer?

And as you ramp up 10-nanometer for high-end smartphones, would you expect low-end smartphones to start migration from 28 with 16 FinFET in 2017?
Elizabeth Sun – TSMC – Director of Corporate Communications
… Your question seems to say that if we ramp 10-nanometer in the future, which will be targeting the high-end smartphone, will the low-end smartphone be migrating from 28-nanometer into 16-nanometers.
Brett Simpson – Arete Research – Analyst
And  just to add to that, Elizabeth, how quickly will 10-nanometer scale up relative to the scaling of 20-nanometer — the ramp-up of 20-nanometer and 28? Will it be as fast?
Elizabeth Sun – TSMC – Director of Corporate Communications
So the profile of the 10-nanometer ramp, will that be steeper than the profile of the 20 or the 28-nanometer?

Mark Liu – TSMC – President & Co-CEO

Okay. The first part of the question has to do with 10-nanometer ramp for the high-end smartphone, will the mid/low-end move to 16? I think we — this is up to our customers’ product portfolio. We definitely know a lot of customer is looking at 28-nanometer to use — to do as the low end. But the specification, the smartphone processor specification changes constantly. So what portion of that product will move to 16-nanometer? We think definitely there are some portion, but how a big portion really depends on their product strategy.

On the 10-nanometer ramp, I wouldn’t say it’s bigger. But at least it’s similar scale of our ramp as we do in 16 and as we do in 20.

Brett Simpson – Arete Research – Analyst Great.

Thank you. And let me just have a follow-up here. There’s been a lot of talk in the industry about one of your larger customers [Qualcomm] planning to introduce a new application processor on both Samsung’s 14-nanometer process as well as your 16 FinFET for the same chip later this year. And we haven’t really seen a single chip get taped out on two new processors at the same time before in the industry. So my question, how does this really work between the two foundries? Does it mean that that one customer can adjust dynamically, month to month, how they allocate wafers between you and Samsung? Or am I — or how might this work?
Elizabeth Sun – TSMC – Director of Corporate Communications … So your question seems to say that there is a customer that appeared to be working with two different foundries on the 14 and 16-nanometer node. And the products are about to arrive. You would like to understand how this customer will be allocating month by month the — what’s the production or the orders with both of the two foundries. Is that your question?
Brett Simpson – Arete Research – Analyst
Yes, that’s right. Whether they can move around dynamically how they allocate wafers. That’s right.

C.C. Wei – TSMC – President & Co-CEO

Well my answer is very typical. Our 16 FinFET is really very competitive. And we did not know that customer going to — how they’re going to allocate. I cannot even make any comment on that.

Gokul Hariharan – JPMorgan – Analyst

First of all on 16-nanometer, since Dr. Wei mentioned that next year a lot of demand on entry-level to mid-end smartphone is still going to stay at 28-nanometer, could you talk about your visibility for second-wave demand for 16-nanometer? 

What is the visibility that you have? Is it going to be really strong? Because you mentioned that a lot of the cost-sensitive customers would still stay on 28, at least for next year.

C.C. Wei – TSMC – President & Co-CEO

For 28-nanometer I said mid to low end this year that, and next year probably, that smartphone will stay in 28-nanometer because it’s very cost-effective and performance-wise is very good. For 16 FinFET I think that people will start to move with their product plan and some of the mid-end smartphone will move into 16-nanometer. That’s for sure.

In addition to that, we also see improving our 16 FinFET ultra-lower-power Mark just mentioned. And that will have a lot of application. And every product, lower power consumption is one of that advantage.

And so that would be our second wave of 16 FinFET.

Dan Heyler – BofA Merrill Lynch – Analyst

… So on 16, this FinFET Compact which is getting introduced, when would we expect to see that in volume production?

C.C. Wei – TSMC – President & Co-CEO

FFC? That will be ready next year. And we expect that high-volume production starts probably two years later. That’s year 2017. 2018 will reach the high volume.

Dan Heyler – BofA Merrill Lynch – Analyst

Okay. So is there a — so the cost-down version for mid-end phones FinFET that you alluded to, plus low power, when is that available?

C.C. Wei – TSMC – President & Co-CEO

Probably in 2017 second half.

Q4’2014:

Lora Ho – Taiwan Semiconductor Manufacturing Company Ltd – SVP and CFO

During the fourth quarter, the strong 20-nanometer ramp was mainly driven by communication-related applications. As a result, communication grew 18% sequentially and the revenue contribution increased from 59% in the third quarter to 65% in the fourth quarter. As for other applications, computer grew 7%, while consumer and industrial declined 21% and 11% respectively.

On a full-year basis, communication increased 39% and represented 59% of our revenue. The major contributing segments included baseband, application processors, image processors and display drivers. Another fast-growing application in 2014 was industrial and standard, which grew 30% year over year. The growth was mainly driven by increasing usage of power management ICs, near-field communications and audio codec within the mobile devices.

By technology, 20-nanometer revenue contribution started with a very small number in the second quarter, jumped to 9% in the third quarter and reached 21% in the fourth quarter. Such unprecedented ramp cannot be achieved without seamless teamwork with our customer, the R&D and operational people in TSMC.

On a full-year basis, 20 nanometer accounted for about 9% of our full-year wafer revenue. Looking forward, we are confident that 20 nanometer will continue its momentum to contribute 20% of the revenue for the whole year 2015.

Meanwhile, customer demand for our 28-nanometer wafers remained strong. Accordingly, these two advanced technologies, 20 nanometer plus 28 nanometer, represented 51% of our fourth-quarter total wafer revenue, a big increase from 43% in the third quarter.

Mark Liu – Taiwan Semiconductor Manufacturing Company Ltd – President and Co-CEO

Now I’ll give you a few words on 10-nanometer development update. Our 10-nanometer technology development is progressing and our qualification schedule at the end of 2015, end of this year, remains the same. We are now working with customers for their product tape-outs. We expect its volume production in 2017.

On the new technology development in TSMC, I’ll begin with beyond 10 nanometer I just talked about. We are now working on our future-generation platform technology development, with separate dedicated R&D development teams. These technologies will be offered in the 2017-to-2019 period. We are committed to push forward our technology envelope along the silicon scaling path.

In addition to the silicon device scaling, we are also working on the system scaling through advanced packaging to increase system bandwidth, to decrease power consumption and device form factors. Our first-generation InFO technology has been qualified. Currently we are qualifying customer InFO products with 16-nanometer technology. And it will be ready for volume ramp next year, 2016. We are now working on our second-generation InFO technology to supplement the silicon scaling of 10-nanometer generation.

On the other side, in addition to the recently announced 55ULP ultra-low power technology, 40ULP, 28ULP technologies for ultra-low power application, such as wearable and IoT, we are also working on 16ULP technology development. This 16ULP design kit will be available in June this year. It will be just suitable for both high-performance and ultra-low power or ultra-low voltage, less than 0.6-volt applications.

C.C. Wei – Taiwan Semiconductor Manufacturing Company Ltd – President and Co-CEO

Good afternoon, ladies and gentlemen. I’ll update you on 28, 20, 16-nanometer status and the InFO business.

First on 28 nanometer. Since year 2011, we started to ramp up 28-nanometer production. Up to now we have enjoyed a big success in terms of a good manufacturing result and, most importantly, the strong demand from our customers. This year we expect the success will continue.

Let me give a little bit more detail, first on the demand side. The demand continues to grow, which are driven by the strong growth of mid- and low-end 4G smartphones, as well as the technology migration from some second-wave segments, such as the radio frequency, hard disk drive, flash controller, connectivity and digital consumers.

Second, on the technology improvement, we continue our effort to enhance 28-nanometer technology by improving the speed performance while reducing the power consumption. 28HPC, 28 ultra-low power technology are some examples.

So to conclude the 28-nanometer status, we believe we can defend our segment share well because of excellent performance and performance/cost ratio and our superior defect density results.

Let’s talk about the 20 SoC business status. After successfully ramp up in high volume last year, we expect to grow 20-nanometer business more than double this year due to high-end mobile device demand, which were generated by our customers’ very competitive products. Our forecast of the 20-nanometer business, as Lora just pointed out, will contribute 20% of the total wafer revenue. That remains unchanged.

Now on 16-nanometer ramp-up. We expect to have more than 50 product tape-outs this year on 16-nanometer. High-volume production will start in third quarter, with meaningful revenue contribution starting in fourth quarter this year. In order to stress again what our Chairman already mentioned, that combining 20 nanometer and 16 nanometer we expect to enjoy overwhelming market segment share.

Last, I will update on the InFO business. The traction on InFO is strong. We have engaged with many customers. And a few of these customers are expected to ramp up in second quarter next year. Right now we are building a small pilot line in a new site to prepare for high-volume production next year. Also we expect this InFO technology will contribute sizeable revenue in 2016.

Dan Heyler – BofA Merrill Lynch – Analyst

…. I guess as we look at your pie chart on your slide with communications and computer being amazingly only 9% of your revenue, and, say, 10 years ago that chart was much, much different, with computer being the biggest. As we look at computer opportunities going forward, I think to some extent there’s maybe a sense of a little bit of disappointment in that we don’t see ARM necessarily in PCs yet. We haven’t really necessarily seen that ecosystem come through in the server business. And big data being such an important trend going forward, with compute growing about 15% per year, I’m wondering what TSMC is doing or what your view of that opportunity will be in the future as a potential growth driver.

Morris Chang – Taiwan Semiconductor Manufacturing Company Ltd – Chairman

Server is one of them, Mark. Well there’s IoT actually also, and just don’t forget that mobile actually we think has a few more years to run yet. Really the TSMC silicon content in the average phone is actually increasing, which is something that is not recognized by a lot of people, because everybody says that the weight, the gravity is shifting to the middle level, lower-level priced phones. But according to our data, and we have kept track of it for quite a long time, the average of TSMC silicon content in the average phone is actually increasing.

So — and look, we still look for over — I think the number we have is that by 2019 there’ll be 2b phones manufactured. It is — I think last year it was, what, 1.3b? I think, yes, 1.3b. 1.3b to 2b. And, well, and the average TSMC silicon content per phone is increasing. And the number of phones is going up. So that’s by no means a — it’s still there. It’s still a growth engine.

And then IoT, I think we talked about IoT before, and now we are certainly not oblivious to the server possibility. So why don’t I ask Mark to talk about the server and maybe C.C. will talk a little about the IoT.

Mark Liu – Taiwan Semiconductor Manufacturing Company Ltd – President and Co-CEO

Okay, Dan. I’ll just respond to you on the server part. Chairman talked about the area we’re mostly focused on, phone, today. And that would drive — give us growth momentum in the next several years.

On server, we work with the product innovators around the world. And such a field definitely we’ll not lose in our radar screen and theirs. And TSMC has been, over the years, developed our technology to suit for high-power computing.

And from 65, 40, 28 to 16 nanometer, we continuously improve our transistor performance. And today we believe our 16 FinFET Plus transistor performance probably is the top of — is one of the top of the world. It’s well suitable, well capable of doing the computing tasks.

And actually before server, and there are several supercomputers around the world, in US and in Japan, already powered by our technology, doing the weather forecasting, whether the geo exploration applications today. And on the server, on ARM in particular, we have very close partnership with ARM in recent years. And ARM is a very innovative company. They produce CPU core and new architecture every year. And we reached our leading-edge technology very early with ARM and to design their leading-edge CPU cores. And that will continue and several of our customers are taking advantage of that.

Yes, in the past it’s been getting into slower as expected. That’s because the software ecosystem is slower to come. And — but actually a lot of the server companies, system company is continuing investing in this ecosystem. Linux-based ecosystem is coming very strong too. So I think the trend will continue. And we will, with our customers, get into these segments in the next — in the near future. Yes.

C.C. Wei – Taiwan Semiconductor Manufacturing Company Ltd – President and Co-CEO

For the IoT, that would be a big topic right now in the whole industry. All I want to say is that we are happy to share with you that, a long time ago, we already focused on our specialty technology, which are the CMOS image sensor, MEMs, embedded Flash, all those kind of things. Today we add another new technology, ultra-low power, into it. And that will be the basis for the IoT technology necessary in the future. We believe that when the time comes and IoT business becomes big, TSMC will be in a very good position to capture most of the business. That’s what I share with you. Thank you.

Randy Abrams – Credit Suisse – Analyst

… And the follow-up question on profitability. If you could give a flavor on structural profitability for 2015 and some of the flavor for 20, how quick that may get to corporate margins, and for 16, because it’s an extension, whether that could be near corporate margins as that comes up. And if you could give a comment on the inventory at current levels, if there’s any — if that will stay at these higher levels from the WIP you’ve been building or if that may come back down to a different level.

Lora Ho – Taiwan Semiconductor Manufacturing Company Ltd – SVP and CFO

Randy, you have multiple questions. I recall you asked for the structural profitability. That’s you first question, right? From what we can see now, we are quite confident we can maintain equal or slightly better structural profitability, standard gross margin versus 2014.

For the 20-nanometer and 16-nanometer ramping, how would that affect corporate margin? I have said in last July it usually takes seven or eight quarters for any new leading-edge technology to get close to the corporate average. So for 20 nanometer, it will take eight quarters. So we believe — so 20 nanometer start to sell in second quarter 2014, and we expect by first quarter 2016, that’s eight quarters, it will be at corporate average level.

For 16, we are going to mass produce this product. It will follow the similar trend. 16 nanometer will be based on the feature of 20 nanometer, so the margin will start to be higher. But it will also follow the similar trend. It takes seven quarters to reach to corporate average. So say we plan to mass produce 16 FinFET in third quarter 2015, so by first quarter 2017 you will get close to corporate average. So there will — before that there will be still small dilutions. For this year, the dilution will be 2 to 3 percentage points. And the last year, the second half will be 3 to 4 percentage points and very low in 2016.

Donald Lu – Goldman Sachs – Analyst

… Chairman, about six months ago you gave us a comment on your estimate on TSMC’s market share in FinFET in 2015, 2016, 2017. So has that changed?

Morris Chang – Taiwan Semiconductor Manufacturing Company Ltd – Chairman

… Donald’s question was I said — actually I looked up my statement at that time, July 16 of last year. I said on the subject of 16 and 20, 16-nanometer and 20-nanometer technology, I said that — I actually made three statements.

The first statement was that because we started 16 a little late, our market share in 2015, our 16-nanometer market share in 2015 will be smaller than our major largest competitor’s.

The second statement I made was that we started 16 late because we wanted to do 20. And so if you combine 20 and 16, our major competitor, who will be slightly ahead of us this year on the 16, he has very little 20. Almost no 20 at all. And if we combine 20 and 16, our combined share in this year will be much higher than that competitor’s.

The third statement I made is that in 2016 we will have much larger share in just 16 nanometer than that competitor.

All right. First I want to say that I, at this time, stand on those statements. In fact, I now will add a couple of statements. The statements I will add are — that’s fourth statement now. Okay? When we have a larger share of just 16 alone in 2016, the 16 market will also be much larger than this year, 2015. So, yes, we’re slightly behind. We have a smaller market share in 2015 in a smaller market. Next year we will have a larger share, in fact much larger share, in a much larger market, 16.

So — and another statement I want to make is that I’m, at this point, very, very comfortable with all those statements that I have made on July 16 last year and the statements that I have added today. I’m very comfortable. I don’t know whether I answered your question or not, Donald.

Donald Lu – Goldman Sachs – Analyst

Yes. How about 2017, if –?

Morris Chang – Taiwan Semiconductor Manufacturing Company Ltd – Chairman

What? Well, 2017, the share is going to continue. We’re not going to lose the leadership on 16 market share once we recapture that in 2016. It’s going to continue 2017, 2018. And also both 20 and 16 are going to live longer than you might think now. Well 28, for that matter, will also live longer than you’d think.

Michael Chou – Deutsche Bank – Analyst

… Can we say your 16-nanometer market share in 2016 will be quite similar to your dominance in 28 nanometer, given that your 20 nanometer is the only provider? So the apple-to-apple comparison should be 28 to 16 nanometer.
Elizabeth Sun – Taiwan Semiconductor Manufacturing Company Ltd – Director of Corporate Communications
So market share in 16 nanometer in 2016, will that be the same as our market share at 28 nanometer, I would say, back in 2013, 2014?
Michael Chou – Deutsche Bank – Analyst Yes

Morris Chang – Taiwan Semiconductor Manufacturing Company Ltd – Chairman

Well, no, I don’t think so, because 28, of course we were virtually sole source. And 16, we already know we’re not. There’s at least one major competitor and then there’s another one that’s just eager to get in. I don’t mean that first competitor’s accessory, I mean another one.

Brett Simpson – Arete Research – Analyst

My question is around 28 nanometer. You’re running a large capacity at 28 nanometer at the moment. So can you share with us what your capacity plan is for 28? As you migrate more business to 20 nanometer and below over the next couple of years, do you intend to convert 28-nanometer capacity to lower nodes, or do you think you can keep the existing 28-nanometer capacity running full going forward.
Elizabeth Sun – Taiwan Semiconductor Manufacturing Company Ltd – Director of Corporate Communications
All right. Let me repeat Brett’s question so that people here can hear it better. Brett’s question is TSMC’s 28-nanometer capacity is very large. As our technology migrates to more advanced nodes, such as 20 and 16, in the next few years, what will be our plan on capacity of the 28 nanometer? Will we still have large demand to utilize those capacities or we need to do some changes?

Morris Chang – Taiwan Semiconductor Manufacturing Company Ltd – Chairman

Every — in every generation we worry a lot about the conversion loss we will suffer when we convert the equipment of that — the existing capacity of that generation to the capacity of the next generation. Now, so we do two things. First, we try to minimize that conversion loss. And since we’ve been living with the problem for so long now, I think we’re getting to be pretty good at it. So the conversion loss from one generation to another is normally in the low single digit, low middle single digit. Now the second thing we try to do is, and I think we actually have been doing it perhaps even more successfully than the first thing. The first thing was to try to minimize the conversion loss. The second thing we try to do is we try to prolong the life of each generation. And I was saying just five minutes ago that I think that the life of 28 nanometer may be longer than a lot of people think. And I mean it. Actually we’re still making half-micron stuff. And we try to prolong the life of every generation as we continue to migrate to advanced technologies. And 28 is certainly a generation that we want to prolong the life of.

Bill Lu – Morgan Stanley – Analyst

My first question is on 28 nanometers. If I look at your capacity this year versus 2014, how much is the increase in capacity?

Morris Chang – Taiwan Semiconductor Manufacturing Company Ltd – Chairman

High teens. High teens actually.

Gokul Hariharan – JPMorgan – Analyst

… First, I had a question on there’s been a lot of controversy about cost per transistor, whether Moore’s law — the economics of Moore’s law are slowing down. Your competitor Intel has put out a very emphatic statement saying that until 7 nanometer they’re seeing that continuing at the same pace as before. But there has been a lot of noise from the fabless community in the last couple of years that at 20 nanometer or at 16 nanometer there is a potential slowdown.

Could we have TSMC’s version now that you’re pretty much ready to start 10 nanometer and thinking already about 7? That’s my first question.
Elizabeth Sun – Taiwan Semiconductor Manufacturing Company Ltd – Director of Corporate Communications
So, all right. Let me repeat. Gokul, your question is mainly on the comments on cost per transistor. Some of the other players, I think you’re referring to Intel, who has made comments that they do see the cost per transistor to continue into 7 nanometer and so they can handle the economics of the Moore’s law. Whereas, on the other hand, fabless companies begin to complain about not seeing enough economics, starting with 20 nanometer. So what is TSMC’s statement regarding this economics issue?

Mark Liu – Taiwan Semiconductor Manufacturing Company Ltd – President and Co-CEO

Let me answer this question. The cost of transistor continues to go down. And by scaling mostly is — everybody knows, nobody I think has refused that statement — we see the cost of transistor continues going down in a constant rate. And in going forward, the cost of transistor going down probably at slightly slower rate. That’s the argument. But it really depends on companies. And for some companies simply do not have the technological capabilities. And today, further going down the Moore’s Law technology developments, just a few. And we — as far as whether those costs can — is — can get enough returns, and of course that has to do with how much that technology brings value to the product where they command the price. And today we see certain segments will continue to need that type of system performance to get enough return. So this is the reason we committed to push the system scaling.

Roland Shu – Citigroup – Analyst

Just a 10-nanometer question to C.C. Since, C.C., you said we are expecting to volume production of 10-nanometer in 2017. But I remember in the past two quarters actually our goal was to pulling in 10-nanometer mass production by end of 2016. So are we pushing out the 10-nanometer mass production schedule a little bit on that?

C.C. Wei – Taiwan Semiconductor Manufacturing Company Ltd – President and Co-CEO

Let me explain that, because 10 nanometer, the mask layers is about 70 to 80. So you’ve got to start in 2016 to have output in 2017. So what I’m talking about is 2017 is to start to have revenue.

Q3 2014:

Lora Ho – TSMC – SVP & CFO

By technology, after two years of meticulous preparation we began volume shipments of 20-nanometer wafers. The revenue contribution went up from 0% to 9% of the third quarter wafer revenue. This is the fastest and the most successful ramp for a new technology in TSMC’s history.

Mark Liu – TSMC – Co-CEO


On 10-nanometer development, our 10-nanometer development is progressing according to plan. Currently we are working on early customer collaboration for product tape-outs in 4Q of 2015. The risk production date remain targeted at the end of 2015.

Our goal is to enable our customers’ production in 2016. To meet this goal, we are getting our 10-nanometer design ecosystem ready now. We have completed certification of over 35 EDA tools using ARM’s CPU core as the vehicle. In addition, we have started the IP validation process six months earlier than previous nodes with our IP partners.

We are working with over 10 customers on their 10-nanometer product design. The product plans show wide range of applications, including application processors, baseband, CPU, server, graphics, network processor, FPGA and game console. Our 10-nanometer will achieve industry-leading speed, power and gate density.

C.C. Wei – TSMC – Co-CEO


Next, I’ll talk about the 16-nanometer ramp and competitive status. In 16-nanometer, we have two versions, 16 FinFET and the 16 FinFET Plus.

FinFET Plus has better performance and has been adopted by most of our customers. 16 FinFET we began the risk production in November last year and since then have passed all the reliability qual early this year. For the FinFET Plus, we also passed the first stage of the qualification on October 7 and since then entered the risk production. The full qualification, including the technology and product qual, is expected to be completed next month.

So right now we have more than 1,000 engineers working on ramp up for the FinFET Plus. On the yield learning side, the progress is much better than our original plan. This is because the 16-nanometer uses similar process to 20 SOC, except for the transistor. And since 20 SOC has been in mass production with a good yield, our 16 FinFET can leverage the yield learning from 20 SOC and enjoy a good and smooth progress. So we are happy to say that 16-nanometer has achieved the best technology maturity at the same corresponding stage as compared to all TSMC’s previous nodes.

In addition to the process technologies, our 16 FinFET design ecosystem is ready also. It supports 43 EDA tools and greater than 700 process design kits with more than 100 IPs. All these are silicon validated. We believe this is the biggest ecosystem in the industry today.

On the performance side, compared with the 20 SOC, 16 FinFET is greater than 40% speed faster than the 20 SOC at the same total power or consumes less than 50% power at the same speed. So our data shows that in high-speed applications it can run up to 2.3 gigahertz. Or on the other hand, for low-power applications it consumes as low as 75 miniwatts per core.

This kind of a performance will give our customer a lot of flexibility to optimize their design for different market applications. So far we expect to have close to 60 tape-outs by the end of next year.

In summary, because of the excellent progress in yield learning and readiness in manufacturing maturity and also to meet customers’ demand, we plan to pull in 16-nanometer volume production through the end of Q2 next year or early Q3 year 2015. The yield performance and smooth progress of our 16 FinFET, FinFET Plus further validate our strategy of starting 20 SOC first, quickly follow with the 16 FinFET and FinFET Plus. We chose this sequence to maximize our market share in the 20-, 16-nanometer generation.

Next, I’ll talk about 28-nanometer status. We had strong growth in second quarter on 28-nanometer. And the business grew another quarter and accounted for 34% of TSMC’s wafer revenue in third quarter. On the technology side, we continue our effort to improve yield and tighten the process corners, so that our customer can take advantage of these activities and shrink their die size and therefore reduce the cost.

Let me give you an example. On 28LP, the polysilicon gate version, we now offer a variety of enhanced processes to achieve better performance. We also offer a very competitive cost so that our customers can address the mid- to low-end smartphone market. In addition to the 28LP, we also provide a cost-effective high-K metal gate version, the 28HPC for customers to further optimize the performance and the cost. Recently, we added another 28-nanometer offering we called 28 Ultra Low Power, for ultra low power applications obviously. We believe this 28ULP will help TSMC customers to expand their business into the IoT area.

In summary, we expect our technology span in 28-nanometer node will enhance TSMC’s competitiveness and ensure a good market share. We also expect the strength of the demand for our 28-nanometer will continue for multi years to come. In response, we are preparing sufficient capacities to meet our customers’ future demand.

Q2 2014:


Morris Chang – TSMC – Chairman

Now a few words on 20-nanometer and 16-nanometer progress. In the last two and half to three years, 28-nanometer technology has driven our growth. In the next three years, 20 and 16-nanometer technologies are going to drive our growth; 28 in the last two and half to three, 20 and 16 in the next three.

After two years of meticulous preparation, we began volume shipments of our 20-nanometer wafers in June. The steepness of our 20-nanometer ramp sets a record. We expect 20-nanometer to generate about 10% of our wafer revenue in the third quarter and more than 20% of our wafer revenue in the fourth quarter. And we expect the demand for 20-nanometer will remain strong and will continue to contribute more than 20% of our wafer revenue in 2015. It will reach 20% of our total wafer revenue in the fourth quarter of this year and it will be above 20% of our total wafer revenue next year.

The 16-nanometer development leverages off 20-SoC learning and is moving forward smoothly. Our 16-nanometer is more than competitive, combining performance, density and yields considerations. 16-nanometer applications cover a wide range including baseband, application processors, consumer SoCs, GPU, network processors, hard disk drive, FPGA, servers and CPUs. Volume production of 16-nanometer is expected to begin in late 2015 and there will be a fast ramp up in 2016. The ecosystem for 16-nanometer designs is current and ready.

A few years ago, in order to take advantage of special market opportunities, we chose to develop 20-SoC first and then quickly follow with 16-nanometer. We chose this sequence to maximize our market share in the 20/16-nanometer generation. As the 20/16 foundry competition unfolds, we believe our decision to have been correct.

Number one, in 20-SoC, we believe we will enjoy overwhelmingly large share in 2014, 2015 and onwards.

Number two, in 16-nanometer, TSMC will have a smaller market share than a major competitor in 2015. But we’ll regain leading share in 2016, 2017 and onwards.

Number three, if you look at the combined 20 and 16 technologies, TSMC will have an overwhelming leading share every year from 2014 on.

Number four, in total foundry market share, after having jumped 4 percentage points in 2013, TSMC will again gain several percentage points in 2014. This is the total foundry market share covering all technologies. After having increased 4 percentage points last year, TSMC will gain another several percentage points this year.

Now a few words about 10-nanometer. The 10-nanometer development is progressing well. The 10-nanometer speed is 25% faster than the 16-nanometer. The power consumption is 45% less than 16-nanometer and the gate density is 2.2x that of the 16-nanometer. Power is 25% faster. Did I say power? I meant speed. Speed is 25% faster, power is 45% less, gate density 2.2 times more, all compared with 16-nanometer.

We work closely with our key customers to co-optimize our 10-nanometer process and design. We expect to have customer tape outs in the second half of 2015.

William Dong – UBS – Analyst

Good afternoon Mr. Chairman. I guess — we keep talking about technology. I guess the question I want to ask is that with all this rush to continue to push down technology roadmap, to go down to 16, to 14 and to 10 nanometer, what are our thoughts about what’s driving this demand? As we move toward, for example, Internet of Things, is there such a requirement to keep pushing on the technology front to actually have enough, sufficient demand to keep driving it down?

Morris Chang – TSMC – Chairman

Well, if the cost is low enough — cost is very much a part of the equation. If the cost is low enough, the demand will increase because we can see a lot of applications that are just waiting there. Of course I’m talking about the mobile products, but I’m also talking about Internet of Things, so wearables and so on, so on, Internet of Things. The applications are just waiting there for better, for faster speed and lower power and higher density ICs. Cost is definitely in the equation.

So, yes, when you ask will the demand be there. If we can get the cost down to an acceptable level, demand will be there. And of course that’s why — that’s how things like EUV come into the question. Nobody has asked about that yet. We actually were prepared to answer that with the same answer that we gave you last time, by the way, that we are still planning to — there’s still a possibility to use EUV on one, one or two — or just one layer in the 10 nanometer, yes. One layer, one layer in 10 nanometer and 7 I think is, of course, an even better candidate.

Dan Heyler – BofA-Merrill Lynch – Analyst

Hopefully this question simplifies and doesn’t complicate things. Just to make sure I understand this share loss thing, so basically what you’re saying is the share loss at 16, these are customers that are choosing to skip 20? Is that how should I think of this that these are not any — are any of these customers that are currently 20 that are going to 16 next year or is this all people that are choosing to skip 20?

Morris Chang – TSMC – Chairman

Well, first of all, I want to question the word share loss. I don’t consider there is share loss because just like 32/28 we had zero share in 32. But then we were very successful in 28. The two really belong to the same generation. And 20 and 16 also belong to the same generation. So, yes — and share loss means that you start with something and then you lose it, it becomes less. Well, this year nobody has — everybody has zero share, okay. And I am just saying that we will start on 16, we will start with a lower share than we did with 20 or 28. We start with a lower share than we did with 20 or 28. And then we’ll get back to a high share in 2016. I’m just arguing with him, but he did have a question; what was that?

Dan Heyler – BofA-Merrill Lynch – Analyst

Or just simply are your — are these customers moving to 16, are these the ones that have currently been on 20 or are these the guys that have skipped because the debate in the industry is should we go straight to 16 and skip 20. So are these customers that have basically been at 28 and are skipping 20 and going straight to 14 at your competitor?

Morris Chang – TSMC – Chairman

Mainly because our customers wanted it sooner. We got in a little late, as I said; our customers wanted it sooner. So that’s why we’re starting — and we’ll catch up only a little later.

Michael Chou – Deutsche Bank – Analyst

Chairman, regarding the 16/20 nanometer, could we say your total market share in 16 and 20 nanometer will be similar to 28/32 for the corresponding period? Can we say that?


Morris Chang – TSMC – Chairman

The combined 20 — I just ran an analysis just a couple of weeks ago, so I know exactly the answer to your question. The combined 20/16 market share in the first two years of its existence, which is this year and next year — well, I guess I have to add in 2016 — the combined — our combined 20/16 share in 2014, 2015 and 2016 will still be greater than our combined share of 32 and 28 in 2012, 2013 and 2014.

Q1 2014:


Mark Liu – Taiwan Semiconductor Manufacturing Company Ltd – President & Co-CEO

Then I cover the updates on 16 FinFET, 16 FinFET plus and our 10 FinFET. First, we have two general offers for customers, 16 FinFET and 16 FinFET plus. 16 FinFET plus offers 15% speed improvement, the same total power, compared to 16 FinFET. More importantly, 16 FinFET plus offers 30% total power reduction at the same speed, compared to 16 FinFET.

Our 16 FinFET plusmatches the highest performance among all available 16-nanometer and 14-nanometer technologies in the market today. Compared to our own 20 SoC, 16 FinFET plus offers 40% speed improvement. The design rules of 16 FinFET and 16 FinFET plus are the same; IPs are compatible.

We will receive our first customer product tapeout this month. About 15 products planned for 2014, another about 45 in 2015. Volume production is planned in 2015. Since 95% tools of 16 and 20 are common, we will ramp them in the same gigafabs in TSMC. 16 FinFET yield learning curve is very steep today and has already caught up with 20 SoC. This is a unique advantage in TSMC 16-nanometer.

For 10 FinFET, 10 FinFET offer TSMC’s third generation FinFET transistor, designed to meet the power and the performance requirement of mobile computing devices. 10 FinFET will offer greater than 25% speed improvement, the same total power, compared to 16 FinFET plus. More importantly, 10 FinFET offer greater than 45% total power reduction at the same speed, compared to 16 FinFET plus.

10 FinFET will offer 2.2X of density improvement over its previous generation, 16 FinFET plus. So, currently, 10 FinFET development progress is well on track, but risk production will be in 4Q 2015. Above are the key messages on three items.

C.C. Wei – Taiwan Semiconductor Manufacturing Company Ltd – President & Co-CEO

…  I would like to take this opportunity to share with you the two topics with you; namely, the 20 SoC ramp and TSMC’s advance assembly solution to our customer. First, I will brief you on the status of 20 SoC ramp.

Let me recap what we had said in the last meeting here. We started 20 SoC production in January this year and by fourth quarter of this year, the 20 SoC will account for 20% of the quarterly revenue — wafer revenue. And for the whole year of 2014 we expect 20 SoC will be about 10% of our total wafer revenue of the year of 2014, of course. All these expectations remain the same today.

Now, there are some major achievement I would like to share with you. First, on the ramping speed. 20 SoC by far is the fastest ramping in TSMC’s history. Of course, this fast ramp is to meet customers’ strong demand. And I believe this production of 20 SoC in TSMC represents one of the largest mobilization in semiconductor history. Let me share with some numbers, so you can have a snapshot on this ramp.

In about one year’s time we have built a manufacturing team of 4,600 engineers and 2,000 operators in two fabs; Fab 14 in Tainan and Fab 12 in Hsinchu. More impressively, in the same time period, close to one thousand engineer has been relocated among TSMC’s fabs in Hsinchu, Taichung and Tainan. All these are prepared for the 20 SoC’s ramp-up. This magnitude of mobilization, I believe, is not an easy job. We move people around that show our strength in manufacturing and this highly mobilization is not moving the tool or just a handful around. We’re talking about we’re moving the engineer and operator among TSMC’s fabs. In the meanwhile, we have installed more than 1,500 major tools for this 20 SoC ramp.

Of course, the faster ramp has done with a very good device reliability and a very good wafer defect density. Without those, the fast ramp will make no sense. Now how important are these 20 SoC ramp? Well we knew that 28 nanometer provided the engine of TSMC’s profitable growth in the years of 2012 and 2013 and similarly, we expect 20 SoC will provide the engine of TSMC’s profitable growth in year 2014 and 2015.

Now let me switch gear to advanced assembly technologies. The purpose of — for us to develop advanced assembly technology is to provide our customer a better performance and a lower power consumption, while at a lower cost as compared to the previous assembly solution. For example, we have developed CoWoS and CoWoS has been developed to connect two dies or more dies together to have a very high performance and a very low power consumption and today CoWoS is in a small volume production already. However, the cost structure of CoWoS has made CoWoS only suitable for some very high performance applications and the products. To address the cost structure issue and for those mobile — very large volume mobile devices, we have developed a derivative technology called InFO; that stands for integrated fan-out.

InFO will have significant lower cost as compared to CoWoS and at the same time, InFO also can have the same capability to connect multiple dies together just as the CoWoS did. Currently, we’re working with major customers and the InFO, to incorporate this structure into their future product. We have delivered many functional dies to our customers already and the process optimization are ongoing.

In fact, we are very excited about TSMC’s advanced assembly technology development as we’re building a innovative solution for our customers product, which requires high performance, lower power consumption and at a very reasonable cost structure.

Michael Chou – Deutsche Bank – Analyst

I don’t know, C.C. Wei, could you give us more color on the advanced packaging you just mentioned. What’s the difference between this one and CoWoS?

C.C. Wei – Taiwan Semiconductor Manufacturing Company Ltd – President & Co-CEO

The difference between the InFO and the CoWoS is actually the geometry to connect multi-dies together. In the CoWoS, actually we are using very small geometry, actually 65 nanometers of geometry to connect the multi-dies together. In InFO, we’re using the larger geometry, which are still technical confidential information. But the cost is much, much lower.

Brett Samson – Arete Research – Analyst

Just had a quick question. Can you give us a sense within the 28 nanometer nodes, how does that split between poly-SiON and high-K and how do you think this might trend through this year?
Elizabeth Sun – Taiwan Semiconductor Manufacturing Company Ltd – Director, Corporate Communications
So Brett’s question is what is really the mix between poly-SiON, that is our 28 LP, versus our high-k metal gate and what is going to be the trend with respect to that kind of mix throughout this year?

Mark Liu – Taiwan Semiconductor Manufacturing Company Ltd – President & Co-CEO

Allow me to answer that. Our 28 nanometer high-k metal gate has three options, 28HP, 28HPM and 28HPC. And this year these 28 high-k metal gate technology will be about 85% of the overall 28 nanometer in terms of the wafer.

Dan Heyler – Bank of America Merrill Lynch – Analyst

… I want to follow up on this InFO, this is quite interesting. Could you just maybe elaborate a bit more on what exactly are you going to be attaching, so which devices are we talking about in terms of what – with CoWoS it was pretty much PLD [Programmable Logic Devices, like Altera] companies were there and others, some baseband. So what devices are you attaching on the initial generation between the different chips? And second part of that question would be what kind of — how many customers do you expect to manage to have in this area, because you start peddling lots of devices and lots of customers it gets really complicated, you start to look more like an OSAT [Outsourced Semiconductor Assembly and Test]. So I wonder if this is going to be a pretty small group of high volume products? And finally on — as you attach — are you actually doing a chip attach or will you be doing only the wafer level activity and will you be having — working with the OSATs to do the actual chip attach?

C.C. Wei – Taiwan Semiconductor Manufacturing Company Ltd – President & Co-CEO

Dan, to answer your question, the InFO actually we’re right now working on application processor together with memory dies. That’s good enough for you. I cannot say anything more than that. We’re working with mobile product customers and we did not — we expect very high volume, but we did not with many, many customers as current status. We’re working on the wafer level process, stacking die, and couple of them, we’re able to do the complete line all here.

Q4 2013:


Morris Chang – Taiwan Semiconductor Manufacturing Co., Ltd. – Chairman

Good afternoon, ladies and gentlemen. Today, our comments are scheduled as on the slide on your left. First, I’m very glad to have the opportunity to introduce our new top management team.

I’d first start with Lora, although I think everyone knows Lora well. Lora has a bachelor’s degree from Chengchi University, a master’s degree from National Taiwan University, both degrees in finance. She worked for Cyanamid, Wyse, Thomas & Betts and TI-Acer before she joined TSMC in 1999. And she has been TSMC’s CFO since 2003.

Next, Dr. C. C. Wei. C. C. has a bachelor’s degree from Chiao Tung University and a Ph. D. from Yale University, both in electrical engineering. C. C. worked for TI, SGS, Chartered before joining TSMC in 1998. C. C. has been Senior VP of Operations, Senior VP of Business Development, Co-COO, and in the Co-COO job CC was successively responsible for R&D and Operations. Now C.C. is President and Co-CEO.

C.C. is 60 years old and I should add that Lora is 57 years old.

Mark Liu; Mark has a B.S. from National Taiwan University and a Ph. D. from Berkeley, both in electrical engineering and computer science. Mark worked for Intel, Bell Telephone Labs before joining TSMC in 1993. And at TSMC he has been VP, Senior VP of Operations and he was also a Co-COO, and all the time he was Co-COO he was responsible for our sales, marketing and planning.

And now Mark and C.C. are Presidents and Co-CEOs of the Company. Mark is 59 years old.

C.C. Wei – Taiwan Semiconductor Manufacturing Co., Ltd. – President & Co-CEO
[about the technology aspects of TSMC’s growth engine]

Good afternoon everybody. I am C.C. Wei and I will give you the update of our 28-nanometer high-K metal gate version. Let me recap the history. We started 28-nanometers volume production in year 2011 mainly on the 28LP, the oxynitride version. And since then the business continued to grow. So last year, we had tripled 28-nanometers of business versus year 2012. That in this year, year 2014, the business for 28-nanometer will continue to grow at least by another 20%, and all the increase are coming from the 28-nanometers high-K metal gate version, which is we name it 28HPM.

Let me add more color to it. We expect we’re going to have about more than 100 tape-outs from about 60 customers in this year in 28HPM. Now you may ask it why? Why there are so many products that were designed on this technology? One of the main reason I can give it to you is the performance, the superior performance. For example, 28 HPM compare with the 28LP that will gain another 30% of the speed at the same kind of power consumption, or you can say that at the same power consumption — at the same speed, you will consume 15% less power. And everybody knows that the power consumption in the mobile device is very important. That’s why we think we have a very high, good business on the 28 HPM.

Now, furthermore, after the 28HPM, we also offer 28HPC, which is a low-cost version of the 28HPM. The 28HPC is developed to meet the customers’ demand to compete in the mid-to-low-end smartphone market. We expect that this 28HPC will have a very strong demand in the next two years. That’s what we have.

Okay, let me give you some information on the competition to explain why we are so confident on this 28 nanometers high-K metal gate business. If you still remember that long time ago, we mentioned about gate-first and gate-last. Still remember that terminology? All right. So, simply to say that gate-last version will give you better performance and a better process control. As a result, all our customers will enjoy using the gate-last versions that technology to have a higher or better performance than other products which are designed with a different approach.

In addition to that I’ll say that because of the better process control and TSMC’s manufacturing excellence, we have a much better yield than our competitor, so that our customer will enjoy the lower die cost. That’s what we have. And that’s why we explained that our confidence that the 28 nanometers business continue a very good business for us.

Now, let me switch the gear to 20-SoC. That’s another exciting news that we have, I want to share with you. 20-SoC is a technology that we developed to enable TSMC’s customer to lead in the mobile device market. And this technology we are believe in this year, next year, well I have a very good business to capture. So, what is the status now of the 20-SoC? We have two fab, Fab 12 and Fab 14 that complete the qual of 20-SoC. And as a matter of fact, we started production. We are in volume production as we speak right now. So, it’s in the high-volume production as we are speaking right now.

Let me add more information to that. First, there are more than $10 billion had been committed to build capacity. Second, we have more than 2,500 engineers and 1,500 operators right now in manufacturing, doing the 20SoC volume production. The ramping rate will be the fastest one in TSMC’s history. Using the ramping rate, you can get the hint of the business, how big the business is.

Another fact to share with you, we have probably — at the end of this year, we have more than dozens of tape-out from about a dozen customers that they are producing the 20SoC product, okay? You may ask, good business, how about the competition? If you have a very strong competition, you might — cannot have too much of confidence on the future. Let me talk about the competition.

I’m very confident that our 20SoC is the highest gate density in volume production at 20 nanometers node. And please remember that; highest gate density and a high volume production. I don’t see any company today can claim on this kind of production and with this kind of gate density at this time, nobody. And most of our competitors, to be frank with you, they’re not even into this game yet. So we are confident to have a good business that will contribute to TSMC’s revenue — wafer revenue by probably around 10% this year. And with that I conclude my presentation and thank you for your attendance.

Mark Liu – Taiwan Semiconductor Manufacturing Co., Ltd. – President & Co-CEO
[about TSMC’s competitiveness versus Intel and Samsung]

I will start this topic by update you our recent development status of our 16-FinFET technology. 16-FinFET technology has been a very fast paced development work in TSMC and we have achieved the risk production milestone of 16-FinFET in November 2013, November last year. And this month, we should pass the 1,000 hours so-called the technology qualification. So the technology is ready for customer product tape-out.

Our 16-FinFET yield improvement has been ahead of our plan. This is because we have been leveraging the yield learning of 20SoC. Currently 16-FinFET SRAM yield is already close to 20SoC. And with this status we are developing an enhanced transistor version of 16-FinFET plus, with 15% performance improvement. It will be the highest performance technology among all available 16 and 14 nanometer technology in 2014. The above progress status is well ahead of Samsung.

Let me comment on the Intel’s recent graph shown in their investor meetings, showing on the screen. We usually do not comment on other company’s’ technology, but this is — because this has been talking about TSMC technology and as Chairman said, has been misleading. To me it’s erroneous, based on outdated data. So I like to make the following rebuttal.

futureICT - 2013--Intel Is Committed to Press Ahead on Density - Enables a 'Transistor Like' Lead in Density

2013: Intel Is Committed to Press Ahead on Density – Enables a “Transistor Like” Lead in Density

futureICT - Jan-2014--Density Comparison by TSMC vs Intel 2013 statement

January 14, 2014: Density Comparison by TSMC vs. Intel’s 2013 statement at its Investor Meeting

On this view graph, the vertical axis is the chip area on a log scale. Basically this is compared at chip area reduction. On the horizontal axis, it shows four different technologies; 32/28, 22/20, 14/16-FinFET and 10-nanometer. 32 is Intel technology and 28 is TSMC technology. So is the following three nodes; the smaller number 20, but on 14-FinFET is Intel, 16-FinFET is the TSMC. On the view graph shown at Intel investor meeting, it is with the grey plots showing here. The grey plots shows the 32 and 20 nanometer, TSMC is ahead of the area scaling, but however, with 16, the data, grey data shows a little bit uptick. And following the same slope, go down to the 10 nanometer. What’s the correct data we show on the red line, that’s our current TSMC data. The 16, we have been volume production on 20 nanometer, as C.C. just mentioned, this is the highest density technology in production today.

We took the approach of significantly using the FinFET transistor to improve the transistor performance on top of the similar back-end technology of our 20 nanometer. Therefore, we leveraged the volume experience into volume production this year, to be able to immediately go down to 16 volume production next year, within one year. And this transistor performance and innovative layout methodology can improve the chip size by about 15%. This is because the driving of the transistor is much stronger, so that you don’t need such a big area to deliver the same driving circuitries.

And for the 10 nanometer, we haven’t announced it, but we did communicate with many of our customers that that will be the aggressive scaling of technology we’re doing. And so, in the summary, our 10 FinFET technology will be qualified by the end of 2015. 10 FinFET transistor will be our third generation FinFET transistor. This technology will come with industry’s leading performance and density. So, I want to leave this slide by 16 FinFET scaling is much better than Intel said, but still a little bit behind Intel.

However, the real competition is between our customer’s product and Intel’s product or Samsung’s product. TSMC’s Grand Alliance; that is the alliance of us, our customers, EDA, IP, communities and our supplier is the largest and the only open technology platform for the widest range of product innovations in the industry today. As for the tape-out of our 16 FinFET, more than 20 customer product tape-outs on 16 FinFET technology is scheduled this year already. They include wide range of applications; baseband, application processors, application processor SoCs, graphics, networking, hard disk drive, field programmable array, CPUs and servers. Our 16 FinFET technology captured the vast portion of products in the semiconductor industry.

We’ve been actively working with our customer’s designer on this since last year. TSMC’s speed and productization of the customer’s product and our ability to execute for a short time-to-market for a customer are far superior than Intel and Samsung.

Lastly, I would comment on the mobile products. With this 16 FinFET technology and the innovations of processor architecture and various IP from our customers, we are confident that this planned, 16 FinFET mobile product, which is going to tape out to us, will be better than Samsung’s 14 nanometer and better than Intel’s 14 SoC. Thank you very much.

Roland Shu – Citigroup Global Markets – Analyst

… Is the 16-plus is improving from the design you were saying or this is just for the performance enhancement or are we going to consider to change our 16-plus to — even to the — same as the 14-nanometer? …

Mark Liu – Taiwan Semiconductor Manufacturing Co., Ltd. – President & Co-CEO

16 FinFET-plus is a transistor enhancement. For the design — back-end design rule are similar to 16 FinFET, therefore designer can design on 16 FinFET and re-characterize, upgrade their product performance. This transistor, as I mentioned, also can reduce the cell size, standard cell size, and with the enhanced performance transistor. That’s the way to reduce the chip size. So we do not intend to change the naming. I mean this is engineering, this is the word — this is the name that we chose earlier based on the physical consistent number and we do not intend to change name.

Randy Abrams – Credit Suisse – Analyst

My first question on the management structure now with the Co-COOs promoted to Co-CEOs. If you could talk about how the responsibilities would change with their promotion to Co-CEO? And for yourself, Dr. Chairman, how will your activities change versus before this move? So if you could talk about the roles for each of the different Co-CEOs and yourself now.

Morris Chang – Taiwan Semiconductor Manufacturing Co., Ltd. – Chairman

We started with President and the Co-CEO in November, and it has been now two months. And if you ask me now, has my life changed in the last two months? My answer is no. It has not changed. But I think that my effort, my time has been spent more on the coaching aspects. I think that — I do believe that I do more coaching. If I spend 100 hours and — I now perhaps spend 20 hours of the 100 hours on coaching, whereas in the past, I’d probably spend only 5 or 10 hours of the 100 hours on coaching.

Now, actually, this is an overseas call, is this correct? Yes. So let me just explain very briefly what the Taiwan law and customs are in relation to a Chairman’s authority and responsibility. Basically, by both law and custom, the Chairman of a company has the ultimate authority and responsibility, basically. However, he may delegate his authority and responsibility to the President. He may also take it back anytime. He can delegate any and all, any or all of the responsibilities to the President. And now these two gentlemen, their titles is President and co-CEO. President comes first. They are, in a very legal sense, Presidents. Now the co-CEO is basically a Western term. And then in the United States, a CEO usually bears the final ultimate responsibility and authority as a Chairman in Taiwan does. In the US, it’s the CEO. Now — so my role in the future is really to convert these two gentlemen from the Taiwan sense President to the US sense CEO, and it will be a gradual process.

Donald Lu – Goldman Sachs – Analyst So Chairman, (spoken in foreign language).

First question is, I want to ask the Chairman, how would you — are you satisfied with the transition so far and also, how the two Presidents would share their work? Are they still rotating or not? And (multiple speakers) but probably not now. And maybe give us some details about how the Company is run. And I have a follow-up question on competition.

Morris Chang – Taiwan Semiconductor Manufacturing Co., Ltd. – Chairman

All right. I am quite satisfied with the transition. And these two gentlemen; Mark is now responsible for sales, marketing, strategic planning, business development, and yes, information technology and materials management, all those. And C.C. is responsible for operations, all the operations, and he is also responsible for specialty technology R&D. Specialty technology incidentally accounts for 25% of our total business. So now, Donald, your other question is whether they’re going to rotate. My plan currently is, I don’t plan it that way, I don’t plan it that way right now. However, I deem it’s a pretty flexible thing. Tomorrow, I may take one part of Mark’s and give it to C.C. or vice versa. But I’m not considering rotation, per se. Yes, does that answer your first question?

Donald Lu – Goldman Sachs – Analyst

… Okay, since we are already doing it, why don’t you give us more color? 16-nanometer, for example, are we saying that in terms of die size, performance, our product will be very similar to Intel’s 40-nanometer FinFET? And also, Mark commented that for the FinFET tape-outs, specifically there’s a CPU and server chips, and can we say that TSMC’s CPU and server chips will have the similar physical performance as Intel’s products today?

Morris Chang – Taiwan Semiconductor Manufacturing Co., Ltd. – Chairman

Well, I think, Donald, we have already given everybody enough information on our 16-FinFET. I think that if we keep giving more, we would be helping our competitors who have picked on us. And so, now, we do stand on what we said. We are going to — our Grand Alliance will out-compete Intel and Samsung. Our Grand Alliance on the 16-FinFET will out-compete. By that I don’t mean that we’ll completely exclude them, no, no, no. We can’t do it. We won’t be able to do that. But our Grand Alliance, with us as foundry supplier, will capture a large share of the 16-nanometer. You agree with that don’t you?

Mark Liu – Taiwan Semiconductor Manufacturing Co., Ltd. – President & Co-CEO

The fabless companies in China are very aggressive approaching leading-edge technologies. To tell you, our 16-FinFET this year, already some of the fabless companies will be using it in tape-outs. So, I think all those fabless companies’ subsidy will propel them into the leading-edge technology more.

July 20, 2013: TSMC takes on rivals with Grand Alliance strategy, says Chang [Global Data Point] by TMC News

(Global Data Point Via Acquire Media NewsEdge) Taiwan Semiconductor Manufacturing Company (TSMC) chairman and CEO Morris Chang, at a July 18 investors conference, talked about the importance of the foundry’s close ties with customers and ecosystem partners, and described how TSMC has formed a “Grand Alliance” with EDA, IP, software IP, systems software and design services providers.

TSMC has been competitive against fellow pure-play foundries, said Chang. In the face of rising competition from IDMs, TSMC with its ability to deliver cutting-edge technologies and advanced manufacturing capacity is also able to outshine the rivals, Chang indicated.

With the industry moving towards sub-20nm technologies, Chang believes that TSMC will become more capable of fending off rivals like Samsung Electronics and Intel. “Now in this new era of competition, the competition is not between foundries. It is not between foundries and IDMs. It is between ‘Grand Alliances’ and IDMs,” Chang pointed out.

Chang named ARM, Imagination, Cadence and Mentor as some of TSMC’s IP and EDA partners.

TSMC’s so-called “Grand Alliance” seems like an expansion of its Open Innovation Platform (OIP), which was announced in 2008. TSMC’s OIP is a business strategy aiming to provide integrated services from design to manufacturing to testing and packaging. According to TSMC, the platform is to bring together the thinking of customers and partners under the common goal of shortening design time, minimizing time-to-volume and speeding time-to-market.

In addition, Chang noted that TSMC’s 28nm process technology is on track to triple in wafer sales in 2013. TSMC made 29% of its NT$155.89 billion (US$5.18 billion) revenues from selling 28nm chips in the second quarter of 2013.

Chang also reiterated TSMC’s plans that 20nm technology will begin volume production in early 2014, followed by volume production of 16nm FinFETs within one year.

MediaTek’s 64-bit ARM Cortex-A53 octa-core SoC MT8752 is launched with 4G/LTE tablets in China

CUBE-Cool Rubik's Cube-MT8752-8732-based T7-T8-T9 range of tablets -- 11-Oct-2014Oct 9, 2014 (reports on several Chinese websites about the launch):  [First MT8752 octa-core Tablet!] 首款MT8752八核平板![999 Yuan Cool Rubik’s Cube T7] 999元酷比魔方T7发布
Oct 11, 2014 on JD.com (Jingdong Mall): [Cool Rubik’s Cube] 酷比魔方(CUBET7 7[inch tablet computer]英寸平板电脑(MT8752[octa-core]八核 JDI[Retina [1920*1200] screen]视网膜屏64[bit]位[China Unicom]联通/[mobile dual]移动双4G 2.0GHz 2G/16G ¥999.00 [$163]
Oct 11, 2014 in ProductShow on [site home of] 网站首页 – [Cool Rubik’s Cube] 酷比魔方(CUBE)[brand website]品牌网站: T7 – 酷比魔方(CUBE)品牌网站

8″ and 9″ tablets (T8 and T9) to come later, as well as the ones with the quad-core SoC variety MT8732.Their lead partner for that is Shenzhen Alldo Cube Technology and Science Co., Ltd. releasing its products under the  [Cool Rubik’s Cube] 酷比魔方(CUBE)brand. More information on this blog: MediaTek is repositioning itself with the new MT6732 and MT6752 SoCs for the “super-mid market” just being born, plus new wearable technologies for wPANs and IoT are added for the new premium MT6595 SoC [March 4-13, 2014]

This is MediaTek’s very first response to the 32-bit Qualcomm Snapdragon 805 Processor (ARM TechCon 2014, Oct 1-3): “our latest and greatest”. Regarding the MediaTek competitive edge over Qualcomm before that you can read on this blog:
– Qualcomm’s SoC business future is questioned first time [May 1, 2013]
– Eight-core MT6592 for superphones and big.LITTLE MT8135 for tablets implemented in 28nm HKMG are coming from MediaTek to further disrupt the operations of Qualcomm and Samsung [July 20, 2013 – March 15, 2014]
– MediaTek MT6592-based True Octa-core superphones are on the market to beat Qualcomm Snapdragon 800-based ones UPDATE: from $147+ in Q1 and $132+ in Q2 [Dec 22, 2013 – Jan 27, 2014]
– ARM Cortex-A17, MediaTek MT6595 (devices: H2’CY14), 50 billion ARM powered chips [Feb 18 – March 13, 2014]

 

HP split into two–HP Enterprise and HP Inc. (devices and printers)–for the growth phase of its turnaround

HP share price -- Sept 2011 - Oct 2014

HP share price — Sept 2011 – Oct 2014. Meg Whitman was named CEO on September 22, 2011. As well as renewing focus on HP’s Research & Development division, Whitman’s major decision during her first year as CEO has been to retain and recommit the firm to the PC business that her predecessor announced he was considering discarding (see the August 2011 post on this blog). After such “stabilization and foundation year” on October 03, 2012 she announced an ambitious 5-year turnaround strategy that promised new products by FY14 and finally growth by 2015.  This plan promised changes in HP’s four primary businesses. Enterprise Services got an entirely different operating model. Likewise the Enterprise Group planned to further utilize the cloud. The operating model of the Printing and Personal Systems Group was simplified by reducing its product line. A new cloud-based consumption model was implemented for the Software Group. With the split now  Meg Whitman writes  that “Hewlett-Packard Enterprise … will define the next generation of infrastructure, software, and services for the New Style of IT” while “HP Inc. will be extremely well-positioned to leverage its impressive portfolio and strong innovation pipeline across areas such as multi-function printing, Ink in the office, notebooks, mobile workstations, tablets and phablets, as well as 3-D printing and new computing experiences”. By separation into two they will “be able to accellerate the progress” they’ve made to date, “unlock additional value”, and “more aggressively go after the opportunities in front” of them.

Also seeing total 55,000 job cuts this year, with 45,000-50,000 cuts already done in Q2. CEO Meg Whitman (age 58) is enjoying huge bonus payments via those job cuts, and then she will lead HP Enterprise as CEO, as well as will become the non-executive Chairman of HP Inc.’s Board of Directors.

Detailed information on this blog about the new direction set up for Personal Systems Group part of HP Inc. (very few):

Latest news from HP Personal Systems Group:
– Revamped Z desktop and ZBook mobile workstations [Sept 10, 2014]
HP Stream series of skinny Windows 8.1 laptops and tablets targeted for the holidays [Sept 29, 2014]
– HP 10 Plus 10.1-Inch 16 GB Android Full HD IPS Tablet with Allwinner A31 quadcore 1.0 GHz on Amazon and elsewhere for $280  [July 13, 2014]
– HP Slate 21 – 21.5″-k100 All-in-One Full HD IPS Android PC with NVIDIA Tegra 4 for $400 [Sept 28, 2014] a 17″ version of which, HP Slate 17 will be hitting stores by New Year

Note that such large screen All-in-One Full HD IPS strategy for both desktop replacements as well as great home devices + complete flat tabletop mode for using an application that’s maybe multi-orientational was started with Windows 8-based HP ENVY Rove [June 23, 2013], using Intel® Core™ i3-4010U and now selling for $980.

Detailed information on this blog about the new direction set up for HP Enterprise (quite extensive and deep):


* Note here that as of now Microsoft Windows Server is not available (even the upcoming Windows Server 10 for “the Future of the datacenter from Microsoft“) on the emerging 64-bit ARM. See: Intel: ARM Server Competition ‘Imminent,’ But Not Yet There, Says MKM [Barrons.com, Oct 2, 2014], in which the current state characterized as:

ARM highlighted progress in servers by citing two data center end-customers (sharing the stage with Sandia Labs but not Paypal) that use HP blades for their Moonshot server chassis based on 64-bit Applied Micro (AMCC, NR, $6.90) and 32-bit Texas Instruments silicon.

HP Moonshot program and the 1st 64-bit ARM server (ARM TechCon 2014, Oct 1-3)

HP’s ARM-powered ProLiant m400 (Moonshot) is ready for DDR4 [ARM Connected Community, Oct 8, 2014]

AppliedMicro and Hewlett-Packard recently introduced the first commercially-available 64-bit ARMv8  server. Dubbed the ProLiant m400, the cartridge is specifically designed to fit HP’s Moonshot server framework. The new server – targeted at web caching workloads  – is based on AppliedMicro’s X-Gene System-on-a-Chip  (SoC) and runs Canonical’s versatile Ubuntu operating system.

… One of the key advantages of the X-Gene based m400? The doubling of addressable memory to 64GB per cartridge. … “You put 10 of these enclosures in a rack and you have 3,600 cores and 28 TB of memory to hook together to run a distributed application,” … “The m400 node burns about 55 watts with all of its components on the board, so a rack is in the neighborhood of 25 kilowatts across 450 nodes.” …

Loren Shalinsky, a Strategic Development Director at Rambus, points out that each ProLiant m400 cartridge is actually a fully contained server with its own dedicated memory, which, in the default launch version, carries a payload of DDR3L DIMMs.

“However, future generations of the cartridges can be upgraded from DDR3 to DDR4, without affecting the other cartridges in the rack. This should allow for even higher memory bandwidth and lower power consumption,” he added. “Our expectation is that DDR4 will ramp on the server side – both in terms of x86  and ARM – before finding its way into desktop PCs, laptops and consumer applications like digital TVs and set-top boxes.”

As we’ve previously discussed on Rambus Press , DDR4 memory delivers a 40-50 percent increase in bandwidth, along with a 35 percent reduction in power consumption compared to DDR3 memory, currently in servers. In addition, internal data transfers are faster with DDR4 , while in-memory applications such as databases – where a significant amount of processing takes place in DRAM – are expected to benefit as well.

Compare the above to what was written in Choosing chips for next-generation datacentres [ComputerWeekly.com, Sept 22, 2014]:

HP CEO Meg Whitman has high hopes for the company’s Moonshot low-energy server family as a differentiator in the commodity server market. Moonshot is based on Intel Atom and AMD Opteron system-on-a-chip (SoC) processors, optimised for desktop virtualisation and web content delivery applications. These servers can run Windows Server 2012 R2 or Red Hat, Canonical or Suse Linux distributions.

Semiconductor companies Cavium and Applied Micro are taking two different approaches to the ARM microserver market. Cavium is specialising in low-powered cores, while Applied Micro is taking a high-performance computing (HPC) approach.

AMD is building its chips based on the ARM Cortex-A57 core. … Servers with AMD’s Seattle [Opteron A-Series] ARM-based chip are not expected to ship until mid-2015.

Note here as well that AMD’s Seattle, i.e. Opteron A-Series strategy is also serving the company’s own dense server infrastructure strategy (going against HP’s Moonshot fabric solution) as described here earlier in AMD’s dense server strategy of mixing next-gen x86 Opterons with 64-bit ARM Cortex-A57 based Opterons on the SeaMicro Freedom™ fabric to disrupt the 2014 datacenter market using open source software (so far) [Dec 31, 2014 – Jan 28, 2014] post.

“HP has supported ARM’s standardization effort since its inception, recognizing the benefits of an extensible platform with value-added features,” said Dong Wei, HP fellow. “With the new SBSA specification [Server Base System Architecture from ARM], we are able to establish a simplified baseline for deploying ARM-based solutions and look forward to future HP [server] products based on the ARM architecture.”

 

32-bit Qualcomm Snapdragon 805 Processor (ARM TechCon 2014, Oct 1-3): “our latest and greatest”

Only 3 devices based on Snapdragon 805 SoC have been announced yet (since September): Amazon Fire HDX 8.9 (will be released on Oct 21), Samsung GALAXY Note Edge and Samsung GALAXY Note 4 (release for both–17 model varieties–is scheduled to take place in 140 countries throughout the rest of October after 17th in the U.S. and into the month of November). In addition Google Hopes Whale of a Phone Will Make Splash in Phablet Market with the 5.9″ Motorola (soon Lenovo) Nexus 6 (Shamu) sporting the Snapdragon 805 SoC, and competing with Apple’s iPhone 6 Plus. It might be released in mid-October (October 15 or 16) quite probably together with groundbreaking Android L.

New Krait 450 CPU cores (of Qualcomm’s own Krait microarchitecture for ARMv7-A CPU instruction set architecture–ISA) and new Adreno 420 GPU (for Qualcomm’s brand new Adreno 4xx GPU architecture) as well as the explained below:
– Ultra HD 4K display with integrated Hollywood Quality Video (HQV) technology [0:50⇒]
– HEVC codec feature [2:02⇒]
More information: Snapdragon 805 Processor Product Brief of Sept 20, as well as AnandTech | Qualcomm Snapdragon 805 Performance Preview of May 21 (also giving details about the Adreno 4xx GPU architecture) plus The first wave of computational photography capabilities from Qualcomm for its new Snapdragon 805 SoCs [this same blog, Jan 4-12, 2014].

Note that the Snapdragon 805 SoC was announced 11 months ago (Nov 20, 2013) with:

sampling now and expected to be available in commercial devices by the first half of 2014.

The 4 months delay is quite explainable by the onslaught of high-end SoCs from aspiring competitors, such as MediaTek (first and foremost, see more below), Rockchip, Allwinner etc., all using 3d party semiconductor IP for CPU and GPU cores. While pushing for maximum attainable performance with Krait 450 and Adreno 420 by adding more time to development, meantime Qualcomm itself was forced to move to high-end 64-bit ARMv8-A ISA cores from ARM Holdings (Cortex-A57/A53 big.LITTLE) for its upcoming 2015 SoCs (Snapdragon 810 and Snapdragon 808) in order to remain competitive, as even with Krait 450 the DMIPS/MHz gain against the first Krait 200 core is marginal: 3.51 vs 3.3. So the Krait 450 is the end-of-the-road implementation of the original Krait microarchitecture (but Qualcomm might come out with a brand new microarchitecture of its own for ARMv8-A ISA cores in order to remain competitive from 2016 and on).

Note as well that MediaTek will pose a direct challenge to Qualcomm in high-end 32/64-bit smartphone SoC space as per MediaTek May Narrow Qualcomm’s Lead in China’s 4G Market [EE|Times, Oct 1, 2014]:

MediaTek, Taiwan’s largest chip designer, has a chance to narrow Qualcomm’s lead in China’s 4G smartphone market with the launch of a new octo-core processor in the first quarter of 2015. MediaTek is sampling now the MT6795, a new 64-bit LTE True Octa-core SoC and will start selling the chip early next year, according to Joey Lee, a company spokesperson.

“The chip will provide Samsung Galaxy Notes-like performance at half the price,” Abrams [Randy Abrams, a Taipei-based analyst with investment bank Credit Suisse] said in a phone interview. “It’s for Chinese brands that want performance comparable to Galaxy Notes or the Apple iPhone at the equivalent of $300 to $400 retail for a handset.”

By the first quarter of next year, MediaTek’s MT6795 shipments are expected to reach 30 million units, giving MediaTek a chance to take the lead from Qualcomm, the Commercial Times report said, without citing the source of its information. Qualcomm has a 68% share of the global baseband chip business that was worth $5.2 billion in the second quarter of this year, according to Strategy Analytics.

The current MediaTek challenge for Qualcomm is MediaTek’s 64-bit ARM Cortex-A53 octa-core SoC MT8752 is launched with 4G/LTE tablets in China [this same blog, Oct 14, 2014]

Regarding the MediaTek competitive edge over Qualcomm before that you can read on this blog:
– Qualcomm’s SoC business future is questioned first time [May 1, 2013]
– Eight-core MT6592 for superphones and big.LITTLE MT8135 for tablets implemented in 28nm HKMG are coming from MediaTek to further disrupt the operations of Qualcomm and Samsung [July 20, 2013 – March 15, 2014]
– MediaTek MT6592-based True Octa-core superphones are on the market to beat Qualcomm Snapdragon 800-based ones UPDATE: from $147+ in Q1 and $132+ in Q2 [Dec 22, 2013 – Jan 27, 2014]
– ARM Cortex-A17, MediaTek MT6595 (devices: H2’CY14), 50 billion ARM powered chips [Feb 18 – March 13, 2014]
– MediaTek is repositioning itself with the new MT6732 and MT6752 SoCs for the “super-mid market” just being born, plus new wearable technologies for wPANs and IoT are added for the new premium MT6595 SoC [March 4-13, 2014]