New processor size seen as crucial to meeting user demand for smaller devices Taiwan Semiconductor Manufacturing (TSMC) will start making chips with transistors as tiny as 40 nanometers (nm) in the second quarter, enabling smaller, more powerful, and energy-efficient chips.The world’s largest contract chipmaker said chips made using 40nm technology will be the smallest in the foundry industry, use less power than slightly older 45nm chips, and the company already has orders for such chips from customers.The move to developing smaller chip manufacturing technology is crucial to meet user demand for ever smaller devices that can do more, such as mobile phones with built-in PDA and camera functions, and digital music players that also play videos and access the Internet wirelessly. Smaller etching technologies are also important to improve the speed and efficiency of chips. The more transistors on a chip, the more powerful it is. The nanometer term describes the size of the smallest feature that can be manufactured on a single chip. There are about three to six atoms in a nanometer, depending on the type of atom, and there are a billion nanometers in a meter.Currently, most chips are still made using technology 90nm and larger, but the move to smaller sizes is increasing, led by high-end chips such as DRAM, microprocessors, core logic chip sets, and graphics processors.Intel, the world’s largest chipmaker, is already producing microprocessors using a 45nm process, and has made SRAM (static RAM) chips using 32nm technology. The company plans to make microprocessors using a 32nm process in 2009, with a 23nm process slated to debut in 2011. The difference between Intel and TSMC is that Intel designs and manufactures its own chips, while TSMC is a manufacturer only, collecting orders from customer companies such as graphics chip designer Nvidia, processor maker Sun, and mobile phone chipmaker Texas Instruments. Technology Industry