DV Hardware bringing you the hottest news about processors, graphics cards, Intel, AMD, NVIDIA, ATi, hardware and technology!

The partnership spotlights the growing technical abilities in China, a country that's already a manufacturing powerhouse for lower-tech products. Terms of the IBM deal weren't disclosed.

The circuitry on microprocessors has steadily shrunk in size, letting manufacturers squeeze more features onto chips, reduce power consumption, and lower chip prices. The industry currently is only beginning a transition from current chips built with 65-nanometer circuitry elements to those with 45-nanometer elements. (A nanometer is a billionth of a meter.)

"We are excited about the SMIC-IBM licensing partnership, which will accelerate SMIC technology advancement in logic process technology and help us provide optimal solutions for our customers at our 300mm facilities," said Matthew Szymanski, vice president of corporate relations for Shanghai-based SMIC, in a statement. The 300mm measurement refers to the diameter of silicon wafers from which chips are carved; SMIC said started 300mm wafer production earlier in December.