Cost to tape-out a 7nm chip: over $1 billion?

It's not a secret that chip development for smaller process nodes has become a lot more expensive. For high-end applications like processors and GPUs there's still a race to get to the smallest possible node, but for more and more other applications it no longer makes sense to shrink to smaller nodes.

FUD Zilla talked to various engineers and executives over the past couple of months and learned that it now costs over $1 billion to tape out a 7nm chip:

The name of the game is called the economy of scale and this taping out 1 billion dollar cost and months of work are getting accommodated by the volume of your sales. Apple sells more than 70 million phones a quarter, and according to Statista, it sold 217.72 million phones.

Even at this incredible volume, Apple still has to set aside almost 5 dollars from each iPhone sold just for the A13 tape out, and one needs to add the manufacturing cost of 7nm on top of this number.

The first tape-outs of 5nm chips are happening right now, these chips are expected to ship in late 2020 and are even more expensive than the 7nm ones.