DigiTimes reports TSMC's 40nm foundry capacity is getting tight due to growing demand for MediaTek's smartphone chips. These 40nm chips are mainly supplied to China-based clients.
MediaTek has received a pull-in of orders for its dual-core processors and 4-in-1 connectivity combo chips from China's smartphone sector since June, the sources indicated. However, 40nm manufacturing capacity at its foundry partner TSMC is running short of demand, leading to the chip shortages, the sources said.
With TSMC's tight supply of 40nm chips, shipment delivery times to customers have been extended to more than eight weeks, the sources pointed out.
The short supply of MediaTek's smartphone solutions has also encouraged the chip holders to sell at a high prices to earn profits, the sources observed. For instance, some chip traders reportedly sold the MediaTek MT6577 solution for more than US$20 on the gray market in China. The chip is quoted by MediaTek at only about US$10.