IBM & GlobalFoundries: $2 billion deal to fab chips

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in hardware on (#2SKZ)
The seemingly on-again, off-again negotiations between IBM and GlobalFoundries over IBM's microchip manufacturing operations may have reached a successful conclusion this week. Dan Nenni, a semiconductor industry writer and consultant, published a story on Tuesday on the SemiWiki website asserting that IBM and GlobalFoundries have reached a "handshake" agreement on a deal valued at more than $2 billion, "on pretty good authority."

The potential deal is part of the transformation of the computer chip industry toward a "fabless" model under which chip companies outsource their manufacturing to so-called "foundry" companies such as GlobalFoundries and Taiwan Semiconductor Manufacturing Co. The trend has even led companies like Intel Corp. and Samsung Electronics, which still make their own chips, to offer foundry services.

IBM sent shock waves through the industry when it was reported they were investigating a sale of their chip fabrication business earlier this year. IBM has been a stalwart of the world semiconductor industry, inventing DRAM, mastering SiGe, SOI and much more besides and supplies manufacturing process technology to half the world's major companies, including Samsung, Globalfoundries, UMC, STMicroelectronics, Renesas, NEC, Freescale, Toshiba and Infineon.

Electronics Weekly has a good look at the deal, the history, and the implications for the industry.
Reply 2 comments

Such a shock (Score: 0)

by Anonymous Coward on 2014-09-20 01:57 (#2SMS)

Really? After they sold their PC business and declared a move towards services years ago

the economic trend (Score: 1)

by zafiro17@pipedot.org on 2014-09-20 16:39 (#2SNE)

remains for specialization and outsourcing, meaning Apple is still sort of the only vertical integrator around here, even if they rely on others for the manufacturing process. The risk of course is of over-specialization, where all the different chip manufacturers wind up waiting on line for the one foundry that has the tech and the equipment to actually fab the chips. Your average Joe doesn't just decide to throw his hat in the ring and start up a foundry, meaning the risk of overspecialization becomes a security risk.

Just thinking out loud here. Maybe it will lead to lowered prices for chips, which is a good thing, and would free up resources for innovation. Was just reading Ritchie's rant from 30 years ago that little innovation was happening anymore and Linux was simply a copy of Unix technology. I think he was deploring that we'd largely come away from investigation into things like alternative chip architectures, the Lisp machines, and similar experiments. He's right - I think that era died out a while ago, while we've decided to milk the current architecture to its eventual limits instead.