The global race for advanced artificial intelligence capabilities is increasingly focused on securing a stable supply of High Bandwidth Memory (HBM), a critical component for AI semiconductors. Following visits from Nvidia CEO Jensen Huang and AMD CEO Lisa Su, speculation is mounting that Google CEO Sundar Pichai may also travel to South Korea to address HBM procurement, according to industry analysts.
The demand for HBM is surging as AI models require ever-increasing memory capacity and speed. South Korea currently dominates HBM production, with companies like SK Hynix and Samsung Electronics leading the way. This strategic position is drawing top tech executives to the peninsula as they seek to solidify their supply chains.
Kim Jeong-ho, a professor of electrical and electronic engineering at KAIST, often referred to as the “father of HBM” for his pioneering operate in the field, stated that the AI semiconductor market hinges on Nvidia, AMD, and Google. “Given that all three companies require HBM, the possibility of Pichai visiting Korea is quite high,” he said in a recent interview with iNews24.
The competition for HBM has intensified to the point where it’s essentially a “HBM securing competition,” Kim explained, with Korean companies holding the key to production. He added that the increasing importance of HBM in GPU performance is driving up demand and potentially prices.
Korean Companies Lead the HBM Market
SK Hynix currently holds the largest market share in HBM production, supplying HBM3E to Nvidia. Samsung Electronics has completed development of HBM4 and has begun mass production, strengthening its “one-stop supply” strategy that combines foundry services with advanced packaging. This integrated approach is proving attractive to major tech companies.
The recent influx of tech CEOs to South Korea underscores this trend. Following visits from OpenAI’s Sam Altman, Nvidia’s Jensen Huang, and SoftBank’s Masayoshi Son last year, Lisa Su of AMD recently concluded a trip to Korea, reportedly to explore strengthened collaboration with Samsung, particularly regarding HBM4 supply.
AMD CEO Lisa Su and Samsung Chairman Lee Jae-yong during a dinner meeting on March 18, 2024. [Photo=Samsung Electronics]
Evolving AI Semiconductor Architecture
AI semiconductor architecture is also evolving rapidly. Nvidia’s next-generation Vera Rubin GPU will incorporate HBM4 to significantly expand memory capacity. AMD is also adopting HBM4 in its upcoming Instinct MI455X, with a design that can accommodate up to 16 stacks. Kim Jeong-ho noted that this trend towards increased HBM usage will further intensify the memory securing competition.
“As performance demands increase, the structure is moving towards using more HBM, inevitably leading to a more competitive market,” Kim stated. He also predicted that collaboration will extend to base die design as HBM becomes more customized, with Samsung potentially offering a “turnkey supply” of memory and packaging. He further suggested that Samsung’s position as a supplier could lead to discussions about allocating some GPU or CPU production to Samsung’s foundry.
A shift in the memory industry’s structure is also becoming apparent. Both Samsung Electronics and Micron are reportedly pursuing long-term supply agreements of 3-5 years with major tech companies, a reversal of the traditional dynamic where companies secured supply on demand. Kim Jeong-ho described this as a “flow of market leadership moving towards memory companies,” emphasizing the growing importance of Korea in the AI supply chain.
Nvidia CEO Jensen Huang sharing french fries with reporters in Seoul on October 30, 2023. [Photo= Kwon Seo-ah]
Long-Term Supply Agreements and Market Dynamics
During her recent visit, Lisa Su and Samsung Electronics agreed to expand cooperation centered around HBM4 supply, encompassing memory, foundry services, and advanced packaging. This collaboration is built on a “turnkey supply” system. The increasing demand for HBM is also prompting companies to secure long-term supply contracts, as iNews24 reports Samsung and Micron are actively pursuing agreements with tech giants.
The future of AI semiconductor development will likely be shaped by these strategic partnerships and the ongoing competition for HBM. As AI continues to advance, the ability to secure a reliable supply of this critical component will be paramount for companies aiming to lead in the field. The potential visit by Google’s Sundar Pichai would further underscore the significance of South Korea in the global AI landscape.
Disclaimer: This article provides informational content about technology and industry trends. It is not intended to provide financial, investment, or medical advice. Consult with qualified professionals for specific guidance.
What are your thoughts on the growing importance of HBM in the AI race? Share your comments below and help us continue the conversation.
