Following NVIDIA's announcement of a US $150M to $200M package towards covering anticipated warranty, repair, return, replacement and other costs and expenses relating to faulty 'packaging material', suppliers in Taiwan have gone low-key on the issue.

By 'packaging material', they don't mean 'packaging' as in the logistics, but 'packaging' as in electronics, a package simply put is a ceramic or plastic enclosure in which is embedded a chip (die) with tiny wirings connecting parts of the chip to an interface on one side, be it an array of pins or solder balls. Unlike CPUs, graphics processors are connected to the circuit boards using ball grid arrays.

With NVIDIA indicating that the problem is due to the packaging material used with some of its chips, which was compounded by the thermal design of some notebooks, industry sources in Taiwan believe the problem is most likely related to either the solder bumping process used by one or more of NVIDIA's manufacturing partners or the company's PCB substrate supplier(s).

Sources in Taiwan tell that the defective parts were the GeForce 8500M series mobile GPUs launched sometime in 2007. The problem was caused by related bump processing. Taiwan Semiconductor Manufacturing Company (TSMC), Advanced Semiconductor Engineering (ASE) and Siliconware Precision Industrial (SPIL) all provide bump processing services to NVIDIA.

Both ASE and SPIL denied knowing anything about the issue because the defective chips are older generation products.