Qualcomm has reportedly placed "advanced packaging" orders at UMC, taking the first step towards challenging TSMC's dominance in this particular segment.
Qualcomm Becomes The First Tech Giant To Place Advanced Packaging Orders At UMC, Possibly Setting a New Trend
For those unaware, TSMC has been the leading company in catering to advanced packaging or "CoWoS" orders for industry giants, but it looks like a new competitor has stepped into the scene, seeing adoption from Qualcomm. UMC, or United Microelectronics Corporation, has reportedly bagged an advanced packaging order from the San Diego chipmaker, according to Taiwan Economic Daily, where Qualcomm is expected to integrate UMC's technologies into AI and HPC applications.
While the details around why Qualcomm decided to opt for UMC are uncertain, it is said that the chipmaker will still rely on TSMC for its semiconductor needs, such as for its Oryon architecture, but will use UMC for wafer packaging, likely employing WoW (Wafer-to-Wafer) Hybrid bonding. It is said that UMC isn't far behind with its packaging offers compared to mainstream options available, so Qualcomm has deemed it best to opt for the firm, finding a workaround for the "bottled-up" supply of TSMC's CoWoS packaging.
For the big tech firms, options for semiconductor needs are available since TSMC, Intel, and Samsung provide them. Still, for advanced packaging, it seems like TSMC has a far-fetched lead, which is why the Taiwan giant has monopolized this particular segment. While this has proved to be tremendously beneficial for TSMC's revenue, this ultimately becomes a problem for firms like Qualcomm, who are in need of having a reliant and consistent supply chain, which doesn't become possible with TSMC due to the number of orders it has.
It is said that UMC's packaging for Qualcomm's chips is expected to be in action by 2026, with trial production starting in mid-2025. This will ultimately open new doorways for UMC and the packaging industry, where TSMC might have a rival to compete against.
