TSMC 3nm chip pricing revealed: $20,000 and 25% price increase over 5nm, next-generation CPUs and GPUs will be more expensive

According to a report by DigiTimes, it looks like TSMC’s 3nm chips will be very expensive and will affect next-generation CPU and GPU prices.

NVIDIA, AMD and Intel favored for high wafer cost as TSMC’s 3nm price tag tops $20,000

The report states that due to its dominance in chip manufacturing and the lack of competition yet in the 3nm process segment, TSMC will significantly raise prices for its 3nm chips. TSMC chip prices are shown in a chart showing the jump from 7nm (US$10,000) to 5nm (US$16,000) chips to be about 60%. Now with 3nm, TSMC’s chip costs are expected to exceed $20,000 which means we’re bound to get more expensive products in the form of next-generation CPUs and GPUs.

Currently, AMD and NVIDIA are major customers of TSMC along with Apple and others. NVIDIA has definitely raised the prices of its cards per chip. The RTX 4090 costs 10-15% more than the RTX 3090 and the RTX 4080 costs 50% more than the RTX 3080. The CEO of NVIDIA has also reportedly visited Taiwan to speak with the CEO of TSMC about securing 3nm chips early for their next-line General GPU.

AMD has been able to offset the price by mixing and matching different nodes on its chiplet products. The Ryzen, Radeon, and EPYC combination uses both 5nm and 6nm technologies and chiplets to help lower overall costs associated with monolithic dies. Going forward, Intel will also leverage TSMC’s N5 and N3 nodes in Meteor Lake and Arrow Lake tGPU IPs.

However, this hegemonic position will also allow the price of each generation of wafer foundries to rise sharply without any resistance. It is understood that 3nm has already exceeded 20,000 US dollars. With the sharp increase in production costs, the chip industry is bound to pass it on to customers and consumers, and the price of new peripheral products will not go back.

[…] NVIDIA CEO Jen-Hsun Huang bluntly said that despite limited performance improvement, the increase in new products is reasonable, because the price of 12-inch foundry chips has increased greatly compared to the past, not just a little more expensive.

via DigiTimes

But this reliance on TSMC means that the semiconductor manufacturer will remain in a dominant position and can justify higher prices due to its technological superiority over others. Rival Samsung has also stated that it will start mass production of its 3nm (GAP) node by 2024, but things are not looking great because yields are less than 20% and there are many issues with Samsung’s next-generation node at the moment. All of this means that chip prices will continue to rise in terms of costs and unless there is another competitor on the same level as TSMC, we can’t expect to break this trend.

Intel said one of its goals is to have chip makers like NVIDIA and AMD build their products in their upcoming factories and we’ll see how that goes.

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