Intel’s graphics chip will take advantage of the new version of the 7 nanometer TSMC process: sources

(Reuters) – Intel Corp plans to use Taiwan Semiconductor Manufacturing Co to make a discrete second-generation graphics chip for personal computers that it hopes to help combat the rise of Nvidia Corp, two sources familiar with the matter told Reuters.

The chip, known as “DG2”, will be made in a new chip-making process at TSMC that has not yet been formally named, but is an enhanced version of its 7-nanometer process, the two people familiar with the matter said.

Intel, a long-time world leader in chip-making technology, has lost its manufacturing edge in recent years and is now debating whether to outsource some of its major central processor unit chips, or CPUs, due for release in 2023.

Activist investor Third Point LLC last month sent Intel a letter asking Intel to consider whether to keep its chip design and manufacturing operations under one roof.

Intel has long outsourced other chips in addition to its flagship CPUs and is a major customer of TSMC, the world’s leading contract chip maker. The head of Intel’s autonomous subsidiary, Mobileye, told Reuters last month that its next autonomous vehicle processor will continue to be manufactured by TSMC in its 7-nanometer process.

With its graphics chips, Intel seeks to enter the growing PC gaming market. Its DG2 chip is expected to be released later this year or early 2022 and compete with Nvidia and AMD game chips, which cost between $ 400 and $ 600, the sources said.

The chip-making technology for the DG2 is expected to be more advanced than Samsung Electronics Co Ltd’s 8-nanometer process used in the last round of Nvidia graphics chips launched in the fall, people said. They added that it would also have an advantage over Advanced Micro Devices graphics chips made in TSMC’s 7 nanometer process.

Intel declined to comment and TSMC did not immediately respond to a request for comment.

Intel officials last year said they would outsource the DG2 chip, but did not say which manufacturer won the deal or which chip-making process it would use.