ISuppli: Gear costs to derail Moore's Law in 2014

TechOnline India - June 16, 2009

Moore's Law, which has held as the benchmark for IC scaling for more than 40 years, will cease to drive semiconductor manufacturing after 2014, when the high cost of chip manufacturing equipment will catch up with the industry and make it economically unfeasible to do volume production of devices with feature sizes smaller than 18 nanometers, according to market research firm iSuppli.

SAN FRANCISCO—Moore's Law, which has held as the benchmark for IC scaling for more than 40 years, will cease to drive semiconductor manufacturing after 2014, when the high cost of chip manufacturing equipment will make it economically unfeasible to do volume production of devices with feature sizes smaller than 18 nanometers, according to market research firm iSuppli Corp.

While further advances in shrinking process geometries can be achieved after the 20- to 18-nm nodes, the rising cost of chip-making equipment will relegate Moore's Law to the laboratory and alter the fundamental economics of the semiconductor industry, iSuppli (El Segundo, Calif.) predicted.

"At those nodes, the industry will start getting to the point where semiconductor manufacturing tools are too expensive to depreciate with volume production, i.e., their costs will be so high, that the value of their lifetime productivity can never justify it," said Len Jelinek, director and chief semiconductor manufacturing iSuppli, in a statement.

Moore's Law, described by Intel Corp. co-founder Gordon Moore in a 1965 paper, predicts that the number of transistors that can be placed on a semiconductor doubles every two years. The prediction has more or less held up since, as the industry has developed innovative ways to overcome technology challenges and continue to shrink process geometries—though some in recent times have pointed to trends showing that the pace of scaling has slowed.

Though Moore's Law was originally a prediction by Moore, it eventually became a target for chipmakers, as industry-wide R&D efforts have been geared to keeping scaling on pace with it.

The demise of Moore's Law has been predicted many times. For example, in April an IBM Fellow told an audience at the International Symposium on Physical Design that Moore's Law was running out of steam and observed that only a few high-end chip makers today can even afford the exorbitant cost of next-generation research and design, much less the fabs to build them. Many observers have cited fundamental technical challenges or physical limits when predicting an end to Moore's Law.

Revenue generation by a specific technology node has traditionally fallen off rapidly after its peak, thanks to high demand for chips built at the newest node. But with the rising costs of new manufacturing equipment, semiconductor processes are expected to have more lengthy periods of revenue generation, iSuppli predicted. "The semiconductor industry will be living with historical generations of technology longer than it did before," Jelinek said. "You are not seeing these geometries rise and fall off the way they did before. Rather, they are living on."


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While revenue generated at the 90-nm geometry tailed off dramatically after peaking in 2007, iSuppli said, the newer 65-nm geometry is likely to remain a major revenue generator for many years, Jelinek predicted.

The slowdown in process technology transitions will mean that the semiconductor industry will be driven more by economics than technology, with chip manufacturers attempting to squeeze as much as they can out of current geometries before moving on to the next level, iSuppli said.

"Historically, the focus in the semiconductor industry was always how quickly you could move to the next geometry node," Jelinek said. "Now the question is how to make money by sustaining a specific node."

Among the ways semiconductor manufacturers will try to keep existing processes going will be to employ 3D structures that allow more transistors to be packed into a single device, according to iSuppli. Jelinek's latest report, Silicon Manufacturers Fall Victim to Falling Global Demands, is available for sale through iSuppli's website.

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