Chip design issue to cost Intel $1 billion

Chip flaw to cost Intel $1bn

Intel estimates that a design issue in one of its chips will cost the company around $1 billion (£620 million).

The issue was found in a recently released support chip, the Intel® 6 Series, code-named Cougar Point. The company said it has stopped shipments of the chip used in personal computers with its latest Second Generation Intel Core processors, code-named Sandy Bridge.

The design issue has been corrected and Intel has begun manufacturing a new version of the support chip, which would resolve the issue, it said.

Intel expected to begin delivering the updated version of the chipset to its customers later this month, with full recovery by April.

The systems with the affected support chips have only been shipping since January 9, therefore “relatively few customers are impacted by this issue”, the company said. The only systems sold to an end customer potentially impacted are Second Generation Core i5 and Core i7 quad core based systems. Intel had sent a bit fewer than 8 million of the faulty chips to manufacturers.

Intel cut its first-quarter revenue forecast by $300 million and expects the total cost to repair and replace the chip to be about $700 million. Full-year revenues are seen unaffected.

The Santa Clara, California, company said the defect was discovered after it shipped more than 100,000 of the chips to computer manufacturers getting ready to sell new PC models with the Sandy Bridge processor, which Intel touts as its biggest-ever leap in processing power.

Had the problem gone undiscovered, about 5 percent of PCs using the new chipsets could have failed over a three-year period, Stephen Smith, vice president and director of PC Client Operations at Intel, said on a conference call.

Intel said its engineers zeroed in on the newest defect last week after manufacturers stress-tested the chips with high voltage and temperatures. The flaw could have stopped computers from being able to communicate with their hard disk drives or DVD drives.

According to Anand Lal Shimpi of website AnandTech (, the problem has been traced back to a transistor in the 3Gbps PLL clocking tree on the chipset.

“The aforementioned transistor has a very thin gate oxide, which allows you to turn it on with a very low voltage. Unfortunately in this case Intel biased the transistor with too high of a voltage, resulting in higher than expected leakage current. Depending on the physical characteristics of the transistor the leakage current here can increase over time which can ultimately result in this failure on the 3Gbps ports,” Shimpi writes, quoting Steve Smith, director of Intel Client PC Operations and Enabling.

Ironically, the transistor in question is not essential to Cougar Point, but rather a remnant following re-use in the chipset from an earlier design. Intel has therefore been able to fix the problem simply by removing any voltage to the transistor.

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