Josephine Lien, Taipei; Jessie Shen, DIGITIMES [Tuesday 31 March 2015]

United Microelectronics (UMC) has obtained some orders for high-end 28nm chips from Taiwan Semiconductor Manufacturing Company's (TSMC) major clients including Qualcomm and MediaTek, according to industry sources.

UMC's 28nm HKMG technology has reached mature yield rates enabling the foundry to attract orders from Qualcomm and MediaTek, which rely on TSMC for their high-end chips, said the sources.

Meanwhile, Globalfoundries and China-based 12-inch foundries Semiconductor Manufacturing International (SMIC) and Shanghai Huali Microelectronics (HLMC) have all secured orders for baseband and other mid- to low-end 28nm chips from Qualcomm and MediaTek, the sources indicated.

Previous reports quoted industry sources saying that Qualcomm and MediaTek are looking for alternatives to TSMC in order to lower costs and stay competitive in China's smartphone chip market.

In addition to the increased competition in the 28nm market, TSMC is facing challenge from Samsung Electronics at 16/14nm FinFET, the sources observed. Qualcomm has chosen Samsung as the primary supplier for its next-generation chips, while in the past TSMC's advance-node technology was usually Qualcomm's first choice, the sources said.

Nvidia, TSMC's long-time customer, has also chosen Samsung over TSMC for its next-generation chips, the sources pointed out.