Do More Cores Require More Capacity?

Jim McGregor, Principal Analyst, In-Stat

The answer to that question is more dependant on overall demand for various types of computing systems than the number of cores being used for various reasons. First, the number of cores integrated into a single die continues to be more dependent on traditional semiconductor manufacturing factors. Microprocessor manufacturers are still adhering to Moore's Law in terms of doubling the number of transistors per silicon area every 24 months, but they are using this increasing transistor budget to integrate additional logic instead of memory for a more cost-effective solution, which is the part of Moore's Law most often forgotten. The use of more cores is just a trade-off for the increasing amounts of cache memory that have been integrated over the past decade. In addition, although the first generation of additional cores may significantly increase the die size of a device — or total silicon area if multiple die are used — the vendors continue to move to the next-generation process technology as quickly as possible to bring the die size down.

Despite new process technologies, the die size of these multicore processors is likely to increase the average die size, but not evenly across all applications. While server microprocessors are likely to increase in average die size because of the continued thrust for additional resources, demand for additional cores in PCs will be much slower. PC performance requirements will continue to be offset with requirements for lower power consumption, and the ability of the software to fully use the new resources may lag by 3-5 years. As PCs also account for the highest chip volume, this suggests that total silicon demand will be more stable or even decrease if demand remains constant.

Finally, there is the issue of demand. While In-Stat does not believe that the market for PC applications is a mature market, and there are significant opportunities for low-power X86 processors in other types of consumer applications, the euphoric trend of increasing demand is likely to slow or turn negative by the 2008/2009 timeframe as consumer debt, increasing interest rates, and other economic issues weigh on both consumer demand, which has been robust for most of the decade, and business spending, which has increased significantly over the past three years. In addition, the increasing appetite for server resources is now being somewhat offset by the increasing number of cores and the use of virtualization technology to further partition resources. Although some applications will need more resources, many general business applications will have a slower upgrade cycle. The one positive note is the increasing need for resources by the communications industry as new communications technologies are rolled out over the next few years.

In the end, the need for microprocessor manufacturing capacity is still driven by the overall demand, not by the increasing number of cores. In-Stat was even concerned about the possibility of too much X86 manufacturing capacity by 2008 because of rapid expansion plans by both AMD and Intel. However, AMD has slowed its conversion and ramp schedule of Fab 38, which will eventually add to its current capacity in Fab 36 and Chartered Semiconductor's Fab 7. Additionally, Intel's manufacturing capacity expansions have slowed from a CAGR for microprocessor wafers from ~37% between 2002 and 2005 as it ramped for new processor architectures, dual-core processors, and made the 300 mm transition, to being relatively flat through 2008 as it converts to the 45 nm process node.¹ However, the move to smaller dies on a new process node does have the same effect as increasing capacity. As a result, overall wafer capacity expansions for microprocessor manufacturing are likely to be stable, according to the need for new process technologies over the next few years, and not increasing the significant rates experience in the past. If timed correctly, the next surge in capacity will be with the next upturn in economic and market conditions.