China’s SMIC and Qualcomm 28-nm Deal

The collaboration between China’s SMIC and Qualcomm to manufacture 28-nm wafers in China is a big win for the Chinese foundry. Qualcomm is offering support to SMIC so that it could manufacture Snapdragon processors on 28-nm nodes.

SMIC is not new to Qualcomm as it has previously supported Qualcomm on power management, wireless and connectivity products at various process nodes. This strategic move brings the two companies closer, and allows SMIC to manufacture 3DIC as well as RF front-end ICs in addition to the Snapdragon products.

The supply constraints of 28 nm process at TSMC is sending companies like Mediatek and Qualcomm scrambling to secure capacities at SMIC, UMC and Globalfoundries.

In addition to the collaboration with SMIC, Qualcomm is also working with Samsung and Globalfoundries on 14 nm process, which is scheduled to go into production in early 2015.

On the acquisition front, Qualcomm is also making acquistions critical to its success in the future. It announced acquisition of WIlocity to acquire 60 GHz technology (IEEE802.11ad) also known as WiGig. Looks like Qualcomm is eyeing the60 GHz Gigabit WIFI market and to get a head-start against rivals.