Today, TSMC announced that they may have to increase their pricing, due to costs that threaten their profits. Apparently, building facilities for making the latest chips are becoming more and more costly, and oil pricing and inflation definitely aren't helping.

The price-affected processors will mostly be higher-end chips, but there’s no mention on specific price increases. Still, new emerging markets and demands for desktop and mobile processors might make 2008 a great year for TSMC, so this might prove to be just a scare.

Analysts claim that an 18-inch wafer factory costs $10 billion, or even more, to build, which is triple the cash you’d have to invest to make a current 12-inch wafer fab.

It is highly likely that this price increase will hit both Nvidia and ATI.

More here.