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The truth about SMIC’s 7-nm chip fabrication ordeal

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Semiconductor Manufacturing International Corp. (SMIC) reaching the 7-nm chip fabrication process has been a jaw dropper. Still, while it’s making headlines in the technology and trade media, it’s critical to examine the true value of SMIC’s so-called great leap forward. Can SMIC mass produce chips at its newly developed 7-nm node? The blog attempts to answer this important but tricky question.

However, before that, let’s recap SMIC’s ascent to the 7-nm process node, which itself has been acknowledged as a watershed moment in chip manufacturing when it was released in 2018. Compared to the predecessor 14-nm node, the 7-nm chips significantly boosted performance while also being far more economical by packing a lot more transistors per unit area on a chip.

And a 7-nm node can be built without extreme ultraviolet lithography (EUV) equipment, and the widely accessible deep ultraviolet (DUV) technology can be used to fabricate a 7-nm chip. In fact, TSMC used DUV machines in the early stages of its 7-nm chip production. According to some industry reports, while catching up on this process node, SMIC copied some fabrication technology chunks from TSMC’s process geometry dubbed N7.

Next, as TechInsights work about SMIC’s 7-nm chip reveals, the use of DUV technology adds a lot of complexity to the chip design. For a start, using DUV equipment entails more layers of masks, leading to three or even four rounds of patterning for a 7-nm chip. On the other hand, EUV machines can put chip patterns on a wafer surface by exposing it to light only once, making EUV technology a mainstay for 7-nm and smaller nodes.

In this particular backdrop, Douglas Fuller, an expert on China’s semiconductor industry, told Financial Times that the furor over SMIC’s 7-nm progress is overblown and that China’s top fab is using extra exposure to make up for the lack of EUV tools. He also resonated doubts about the yield of SMIC’s 7-nm chip fabricating process.

According to some industry observers, SMIC’s 7-nm yields per wafer are in the range of 15%. That, in turn, makes the chips manufactured at this process node very costly, around 10 times the market price of a chip manufactured at TSMC’s 7-nm node. It’s also worth noting that the crypto-miner chip known to have been manufactured at SMIC’s 7-nm node features a highly parallel design, which implies lower complexity.

In the final analysis, SMIC’s 7-nm story relates more to China’s political cause of semiconductor self-sufficiency than market economics. At the same time, however, it’s a quasi-7-nm chip manufacturing process that could become a stepping stone for a true 7-nm process node. Here, the missing link is ASML’s EUV technology, currently banned for semiconductor fabs in China.

It’s important to note that after imposing an export ban on the EUV technology, there have been reports about the United States approaching Netherlands’ ASML and Japan’s Nikon to stop the delivery of DUV equipment to China as well. But that’s not likely to matter as fabs in China must have already bought a sufficient number of DUV machines by now. The DUV-based lithography technology has been around since the 1980s.

SMIC has clearly been swimming against the tide in its quest for smaller chip fabrication nodes. Though it’s come a long way since having 28-nm process technology in 2021, its future roadmaps are fraught with gigantic technology hurdles. In retrospect, the shipping of a 7-nm chip marks only the first important step amid concerns about yield rate, manufacturing cost, and more importantly, EUV technology embargo.

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