Just a few short hours after the publication of my prior piece speculating on what cellular modem Samsung's (NASDAQOTH: SSNLF) latest Galaxy S5 LTE-Advanced packed, Qualcomm (NASDAQ:QCOM) went ahead and issued a press release stating that the phone uses both Qualcomm's Snapdragon 805 as well as Qualcomm's MDM9x35 baseband. This is significant not only in that it marks the very first category 6 LTE-Advanced modem to ship, but also the very first 20-nanometer silicon to hit the mobile market.
Say hello to 20-nanometer (it's been quite the wait)
The very first 28-nanometer mobile parts hit the shelves back in early 2012 with Qualcomm's Snapdragon S4. A little over a year later, the first 28-nanometer high-K/metal gate (this is a much higher performance flavor of the 28-nanometer process) built at Taiwan Semiconductor (NYSE:TSM) showed up in the form of the Snapdragon 800. And now, about a year after that, we're seeing the very first 20-nanometer products hitting mobile.
Interestingly enough, Taiwan Semiconductor went into "volume production" on 20-nanometer parts in early 2014, and about six months later the first mobile-oriented 20-nanometer chips are finding their way into devices that will be commercially available within a matter of weeks. That said, this is in a fairly limited-run, ultrahigh-end phone, but nonetheless availability in a commercial device cannot be disputed.
Good news for Qualcomm and TSMC
This is solid execution on the part of Qualcomm particularly as this is now by far the most advanced modem in the industry built on the most advanced foundry process node in the industry. But another interesting point is that this is solid execution by Taiwan Semiconductor, which is likely the manufacturing partner for this chip.
While the road to 20-nanometer has been difficult, it looks as though Taiwan Semiconductor has overcome the significant hurdles, paving the way for the volume availability of Apple's (NASDAQ:AAPL) A-series chips later this year and Qualcomm's integrated apps processor/modem solution in the first half of 2015.
Does this lend credibility to TSMC's FinFET roadmap?
Taiwan Semiconductor delivered on 20-nanometer, and has promised that its 16-nanometer FinFET node will go into production about a year after the 20-nanometer node. If Qualcomm's product teams can execute, then there is a decent chance that this time next year, we'll be talking about the first 16-nanometer FinFET stand-alone modems, followed by an Apple A-series processor built on that process.
Following that, in the first half of 2016, we should then see the first integrated 16-nanometer apps processor/modem. But do keep in mind that the semiconductor equipment vendors have been talking about the industry facing very challenging yield (that is, number of good chips per wafer) issues with the 16 FinFET node, so the 1-year cadence may not hold exactly.
Foolish bottom line
This is a great job on the parts of both Qualcomm and Taiwan Semiconductor. While this isn't a huge volume rollout, it is encouraging to see the first 20-nanometer mobile chips hit the market. Expect to see larger volumes as we exit the year, presumably as Apple begins selling its iPhone 6, with even more robust growth during 2015. The real question, now, is on the timing of the initial 16 FinFET mobile products.