Explained: What is a fab plant, how many types of chips are made in world?

What is a fab plant?

It is a manufacturing plant where raw wafers are turned into integrated circuits (ICs) through a complex process.

Making a chip requires over 500 machines that are controlled by only a few global companies and it goes through 700-1,500 processes, which include heating to over 1,100 centigrade, sometimes as many as 27 times. It also requires over 300 gases and chemicals such as nitrogen and acetone, most of which have to be imported initially, at least in India.

A chip needs a “clean room” with nearly zero dust, lots of water and a stable uninterrupted power supply, a requirement that has made many wonder whether these conditions are possible in India. Fabrication can take between 11 and 13 weeks and modern chips sometimes have as many as 100 layers.

What are the different materials used to make chips?

Semiconductors can be of different kinds, the most common being silicon. There are others, which are based on a combination of elements and are called compound semiconductors. These include gallium nitride and silicon carbide, which are widely used in power electronics, automobiles, telecom equipment etc. They have more heat resistance and are compact.

The investments required to set up these plants are also lower, at below $500 million, compared to a minimum of $3-4 billion for a fab plant.

What are the different types of chip makers?

There are integrated device manufacturers (IDM) like Samsung and Intel, which both design and manufacture chips. Then there are foundries like TSMC, which manufacture chips under contract for others. The third are fabless chip companies such as Qualcomm, MediaTek and Nvidia, which only design the chips and get them manufactured by foundries.

What are the different stages of making a chip?

First, according to semiconductor company ASML, wafers are sliced from a salami-shaped bar with 99.99 per cent pure silicon and polished to ensure extreme smoothness. Thin films of conducting materials are deposited on the wafer.

Second, the wafers are covered with a light-sensitive coating called photoresist. The areas exposed to ultraviolet light change their structure, making it easier for etching.

Then they are put through a lithography machine whose usage determines just how small the transistors on a chip can be.

Fourthly, the wafer is etched where it is baked and reveals the 3D pattern of open channels. It creates a cavity in the wafer with exact depth. After this, the wafer is bombarded with ions which help control the flow of electricity.

Then what?

From a business perspective, there are two models for the next stages of chip making: foundries or IDMs might do the few processes themselves or outsource to third parties to reduce their investment.

There are, therefore, two kinds of players. One is outsourced semiconductor and assembly and test (OSAT) companies, which do the assembly, packaging and testing of ICs for others and include companies such as ASE, Amkor and JCET. The other is a company like Micron, which is coming to India to set up an assembly, testing, marking, and packaging (ATMP) operation using its own fabs abroad. Its competitor in memory chips, South Korean chip maker SK Hynix, is also planning to do the same.

It is here that the chips are taken out of the wafer, sliced and diced with a diamond saw into individual chips. Wafers can contain a few chips or thousands. They also do the IC packaging like wire bonding as well as laser marking, and test the wafer and the ICs so that everything is fine.

How many types of chips are made in the world?

There are four different kinds. First, logic chips that process information to complete a task and used to optimise visual display, processing of deep and machine learning applications, and of course processing in a CPU.

Second, memory chips, which store information and save data when machines are switched on or even when they are off.

Third are application-specific integrated chips (ASICs), which are single-purpose chips used for repetitive routine processing.

And the latest kind of chip is a system on a chip (SoC), which integrates and combines many chips and circuits into one chip like a camera, video or Wi-Fi.

Who designs chips?

Companies like Qualcomm or MediaTek design the chip and get it made by foundries. In India, there are only a few players in the business, which is why the government has created a policy to help build home-grown ones.