DigiTimes reports TSMC is facing increase competition at the 28nm node as rivals have entered mass production of 28nm chips and are able to offer more attractive prices. Previously, TSMC was the only foundry to offer 28nm mass production, but the company's dominance in this market is expected to wane.
As competitors of TSMC offer lower prices to lure customers, the foundry's dominance in the 28nm market will be affected with second-quarter revenues likely to be a disappointment, the sources noted.
Market watchers, however, still believe that TSMC's sales for the second quarter of 2013 will enjoy at least single-digit sequential growth.
In addition, TSMC has received requests from its customers to slow their technology migration plans to the 20nm process, the sources said. In fact, many of TSMC's clients have expressed concern about the limited room the foundry's 20nm node can reduce in their chip power consumption and costs, the sources indicated. In other words, the transition to 20nm process technology from 28nm is not as cost-effective as that from 40nm to 28nm.