Advanced packaging

Packaging used to be the finishing job of wrapping a completed chip to protect it and connecting it to a board. It is done after the chip is made, so it is also called back-end processing. As it got harder and harder to make circuits finer, it became important to raise performance by placing and stacking several chips close together.

AI chips are the best-known case. The GPU that calculates and the HBM that feeds it data are bound tightly together on one board. TSMC's CoWoS is a well-known method. Sometimes the chips themselves have been made, yet fewer AI chips come out because this step is in short supply.

It is like gathering teams that were scattered in far-off offices onto a single floor. People spend less time carrying papers back and forth, so work goes faster.

When AI chips are in short supply, the cause is sometimes packaging rather than the chip factory. That is why chip companies spend large sums to expand this step.