Taiwan Semiconductor Manufacturing Co. and Intel Corp. announced on March 2 that they have forged an alliance that will allow TMSC to use Intel's tiny Atom microprocessors.
"The compelling benefits of our Atom processor combined with the experience and technology of TSMC is another step in our long-term strategic relationship," IntelCEO Paul Otellini said.
Intel said the agreement with TMSC should "significantly broaden the market opportunities" for its Atom processor, which was unveiled last year and is used in a wide variety of electronic devices, from smartphones to netbooks.
The Atom features 47 million transistors and is Intel's smallest processor.
"We expect this collaboration will help proliferate the Atom processor ... and foster overall semiconductor growth," said Rick Tsai, CEO of TSMC, which operates the world's largest dedicated semiconductor foundry.
The agreement with TMSC is unusual for Intel as it tends to tightly control everything from computer chip design to manufacturing. The alliance comes at a difficult time for the semiconductor industry and is aimed at expanding the use of the Atom in electronic devices.
Market research firm Gartner expects worldwide semiconductor revenue to drop 24.1% this year to $194.5 billion while another firm, IDC, has forecast that the semiconductor market will erode 22% this year.
Gartner also reported that sales of personal computers are expected to decline by 11.9% to 257 million units in 2009, the steepest drop in the industry's history.
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