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Source: Global Times

[Global Times special correspondent in South Korea Mang Jiuchen and Zhang Ludan] "Samsung wants to dominate the HBM (high-bandwidth memory) field through its 4nm process technology." The Korea Economic Daily reported on the 16th that Samsung Electronics, one of the world's largest memory chip manufacturers, plans to use its cutting-edge process to produce the next-generation high-bandwidth memory HBM4, which is the core chip that powers artificial intelligence (AI) devices. Samsung wants to use this move to fight its competitors, SK Hynix and TSMC.

Pressure from opponents

According to the Korea Business website, HBM is a memory chip used in high-performance computing applications such as graphics cards, data centers, and artificial intelligence. Compared with traditional memory chips, it is more efficient. In the AI ​​boom, machine learning and other applications require a lot of computing power and memory bandwidth, which increases the demand for HBM.

In April last year, South Korean memory chip manufacturer SK Hynix and Taiwanese wafer foundry TSMC signed a memorandum of understanding to jointly develop HBM4 and provide related products to Nvidia, a leading company in the AI ​​field. This cooperation was called the "HBM Alliance" by many media.

Currently, HBM3 is the product that has won SK Hynix the first place in HBM market share. Industry insiders revealed that SK Hynix is ​​accelerating the development of HBM4 and HBM4E, and plans to mass-produce them in 2025 and 2026 to coincide with the release of Nvidia's AI accelerator. Benefiting from the rise in Nvidia's stock price, the value of SK Hynix, as an important supplier of Nvidia, is also rising.

Samsung and SK Hynix have been competing fiercely in the memory chip market. In the AI ​​boom, both sides are gaining advantages through new product development and mass production. According to the Korea Economic Daily, facing the alliance formed by SK Hynix and TSMC, Samsung Electronics decided to use its advantages as a "comprehensive semiconductor company" to complete HBM production and chip design alone. The competition landscape of the HBM4 market, which will be mass-produced from next year, will be "Samsung Electronics VS TSMC + SK Hynix".

How to achieve "HBM's reversal"

Samsung's bet on 4nm is considered by the industry to regain the "lost ground" in the HBM market share. Currently, SK Hynix still ranks first in this market. Many people in the industry predicted that Samsung Electronics would use 7nm or 8nm process in HBM4 production, because Samsung's 7nm process has been widely used since 2019 and is a stable process, but this time Samsung suddenly upgraded to 4nm in order to achieve a "reversal of HBM". People in the semiconductor industry said, "Compared with 7nm and 8nm, the 4nm process is very expensive, but it performs better in terms of chip performance and power consumption."

Trend Force Consulting revealed that Samsung Electronics' 4nm process yield has reached over 70%, which is similar to TSMC's level. Therefore, some analysts said that if Samsung can improve its price competitiveness, it may have a chance.

"Unlike TSMC and SK Hynix, the participation of chip designers in HBM4 production is our unique advantage," said a Samsung executive. According to the "Korea Business" website, Samsung Electronics has established a new "HBM Development Group" in its device solution department. The newly established development team will focus on promoting HBM3, HBM3E and next-generation HBM4 technologies.

SK Hynix and TSMC are ready to take corresponding measures for Samsung's plan. According to the Korea Economic Daily, the two companies have decided to add a 5-nanometer process to the originally planned 12-nanometer process to produce HBM4.

“There will be no dramatic changes in market structure”

"The competition between Samsung and SK Hynix for AI chip supremacy is heating up, especially in HBM4 chips. The first challenge facing Samsung is to get its HBM chip approved by Nvidia," the Korea Economic Daily quoted a professional as saying. In addition, US memory chip company Micron has also set its sights on the HBM market. A report released by the company in June showed that it plans to increase its HBM market share from the current "mid-single digit" to around 20% in a year.

In the global HBM market, according to Trendforce data, SK Hynix's market share is expected to exceed 52% in 2024, followed by Samsung at 42.4%, while Micron is expected to occupy only 5% of the market share. "We think it will take some time for Samsung to catch up because there are certain technological differences," said Fitch analyst Xie Li Jiang, quoted by Nikkei Asian Review. "In the medium and long term, we don't think the market structure will change dramatically."

Previously, SK Hynix also released a global recruitment advertisement to recruit experienced employees for 48 HBM-related positions. The Korea Economic Daily reported that Samsung Electronics is on high alert because it is facing a strike by more than 6,500 workers, and employees in the semiconductor department are the main force of the strike. However, according to the South Korean Chosun Ilbo on the 11th, only the "National Samsung Electronics Union" among the five unions of Samsung Electronics is currently on strike. Due to the small number of people participating in the strike, the possibility of problems in actual chip production is small. However, due to the decline in trust, there may be obstacles in attracting customers.