Asia Express - East Asian ICT
MediaTek, Intel Forge Strategic Partnership
July 28, 2022

Taiwan's leading fabless IC supplier MediaTek recently announced that the company has entered a strategic cooperation agreement with Intel, with an aim to meet untapped demand in the edge devices while expanding its supply chain to the United States, the United Daily News reported on July 26. The announcement comes as the U.S. government has given significant subsidies to companies in the U.S semiconductor industry, in particular to the US-based chip fabrication. 
Pursuant to the agreement, Intel will fab chips for MediaTek using "Intel 16" process node technologies provided by IFS (Intel Foundry Services). The "Intel 16" node is estimated to be available for tapeouts for customers by the end of 2022 and initial volume production to kick off by early 2023. 
Over the years, demand for smart edge devices used in the IoT (Industrial Internet of Things) applications has enjoyed double-digit growth while EV (Electric Vehicle) and communications chips have continued to face the supply crunch. On top of that, MediaTek aims to boost its bargaining power through the tie-up as its foundry service providers like TSMC and UMC raised chip prices several times in the past year. In addition, they also announced a further price hike for 2023, for instance, TSMC announced a 6% and 5%-10% increase in service prices and UMC a 5%-10% increase. 
Taiwanese semiconductor shipment value is estimated to reach NT$4.37 trillion (US$146.6 million) in 2022, NT$2.19 trillion (US$74.5 billion) of which will be contributed by the foundry industry, according to MIC (Market Intelligence & Consulting Institute). Established in 1987, MIC is a division of III (Institute for Information Industry), a major government think tank, and one of the leading IT research institutes in Taiwan.