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SAMSUNG will manufacture Qualcomm’s next-generation Snapdragon 820 processor, industry insiders say.
Traditionally, TSMC and other foundries have been responsible for manufacturing Qualcomm’s leading edge chips. However, Samsung’s 14nm process now gives its chip plants the edge over TSMC’s 20nm process. The 14nm process will allow smaller and less costly chips, and better power efficiency.
The move to Samsung for chip fabrication may also be an attempt by Qualcomm to win a place for the chip in Samsung’s next Galaxy S flagship smartphone due out in 2016.
For the latest Galaxy S6 phone, Samsung chose to use its own Exynos chip, rather than the Snapdragon 810. This loss forced Qualcomm to cut its annual financial outlook, despite the usage of the chip in the flagship phones of HTC and LG.
Samsung will also be making the Apple A9 chip, making the South Korean company’s mobile processor fabs a leader in chip making deals.
The increased revenue and profit for the chip-making business, however, means losing the 14nm edge for its smartphone business, since the only 14nm processor chip currently on the market is its own Exynos processor.
Using the Snapdragon 820 will make sense for Samsung, because the Exynos processor required a separate modem chip. The 820, on the other hand, will have its own built-in LTE modem, helping reduce costs.