IBM introduces a new method of manufacturing smaller computer chip components

For decades, the tech industry has relied on semiconductor companies’ ability to squeeze more power out of computer chips, making smartphones that fit in your hand today more capable than computers that filled rooms 40 years ago.

While some experts fear that the era of increased miniaturization is coming to an end, IBM says not so quickly.

The tech giant on Thursday released details of its next advancement in chip manufacturing technology, which it says could keep the innovation going for another 10 years.

Using a new approach to making smaller transistors that act as tiny switches in microprocessors and other chips, IBM said the new manufacturing process can squeeze nearly twice as many transistors onto a chip the size of a fingernail than the last technology it unveiled in 2021. This will offer 50 percent more computing power and 70 percent better energy efficiency, the company said.

Both attributes are in high demand, especially in the race to build data centers for artificial intelligence. Energy is a particularly severe constraint, with power-hungry AI chips in some cases causing construction delays in construction because they cannot secure available electricity.

“Everyone wants more performance, but no one wants to pay for performance,” Huiming Bu, IBM’s vice president who leads chip research and development, said in a briefing with reporters.

IBM, although a pioneer in semiconductors, no longer makes or sells chips. But engineers at her lab in Albany, N.Y., are still developing new technology to turn silicon wafers into chips, which they typically license to manufacturers.

Mr. Bu said the technology should be ready in the next five years, but declined to reveal potential users. Previous licensees included Samsung Electronics and Rapidus, a Japanese company.

Industry analysts briefed on IBM’s announcement were stunned, noting that the approach will face competition.

“This is a big deal,” said Dan Hutcheson, an analyst at TechInsights. “It basically gives a plan for the next 10 or 15 years.”

Chip Roadmap is short for Moore’s Law, an oft-cited principle about chip progress attributed to Intel co-founder Gordon Moore. He projects that companies will pack twice as many transistors into a chip every year or two, increasing performance while lowering cost per transistor.

Making chips has become so expensive that the cost benefits of shrinking transistors have disappeared, and industry leaders like Jensen Huang, chief executive of chip giant Nvidia, have declared Moore’s Law dead. But computing speed and data storage capacity continued to improve thanks to smaller transistors.

Miniaturization gains are often described in terms of nanometers or billionths of a meter, although this nomenclature is now less a precise measurement than a marketing term for distinguishing technological generations. Taiwan Semiconductor Manufacturing Company, for example, produces chips with dimensions of about two nanometers. Intel has a comparable technology described as 1.8 nanometers.

IBM described its new manufacturing process as 0.7 nanometers, the first to break the one nanometer mark. The core innovation, which IBM first described a year ago, is what the company calls the “nanostack” transistor.

It’s the latest example of building transistors from three-dimensional structures—like tiny skyscrapers rising from the surface of a chip—rather than simply shrinking transistors in lateral directions.

TSMC and Intel recently adopted a new 3-D structure called the nanosheet transistor, which was also partially pioneered by IBM. IBM’s latest approach uses two nanosheet-style transistor wafers and effectively glues one upside-down to the other, creating a structure that vertically joins two types of transistors in a compact space, IBM said.

Imec, an influential research center in Belgium, is backing the next-generation technology, which has piqued the interest of many chip makers, Hutcheson said. He creates three-dimensional structures layer by layer, a process he says could create defects.

With IBM’s approach, “you get a much better transistor with higher speed and lower power,” Mr. Hutcheson said. “It’s pretty revolutionary.

Patrick Moorhead, an analyst at Moor Insights & Strategy, said questions remain about which partners might adopt IBM’s technology and whether it will be the first to go to market. But the announcement nevertheless suggests that proclamations of the death of Moore’s Law have been exaggerated.

“It’s a sign that we’re not going to run out of gas like we always think,” Mr. Moorhead said.