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A long-promised chip manufacturing technique is now here. And that means our phones will keep getting faster, while our batteries will last longer.

Samsung on Wednesday said it's now building 7-nanometer chips using technology called extreme ultraviolet, or EUV. EUV has been in development for decades, but it's been difficult to roll out in real world factories. Samsung now is the first company capable of using EUV to manufacture chips for upcoming devices.

"It's decades worth of work that's been ongoing," Bob Stear, Samsung senior director of foundry, said Wednesday ahead of an event Samsung hosted at its semiconductor headquarters in San Jose, California. "It's quite a revolution to get it into production."

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A key part of semiconductor manufacturing is shrinking the components called transistors -- extraordinarily tiny electronic switches that process data for everything from microwave oven clocks to artificial intelligence algorithms running in our phones. But as the scale of chip components gets closer and closer to that of individual atoms, it's been hard to keep up the pace of Moore's Law. For decades, the law has charted a doubling of transistors -- and in return, the processing power -- for a given chip every two years, but it's been slowing down.

EUV is key to keeping Moore's Law going -- miniaturization that not only helps our phones but also brings computing smarts to newer gadgets like smartwatches and security cameras.

Samsung's 7nm manufacturing technology, which it calls 7LPP (7nm low power plus), makes it possible to reduce the area of chips by 40 percent from the company's previous 10nm tech. Performance gets a 20 percent boost, while power consumption is reduced by up to 50 percent.

"When you look at something like truly mobile devices, a day of use is so critical," Stear said Wednesday in an interview.

Samsung is proof that Moore's Law matters. To keep up the pace of chip innovation, the industry has had to throw billions of dollars and a lot of great minds at the problem. So far, it's paid off for Samsung. The company is the world's biggest vendor of memory chips, and in 2017, Samsung ended Intel's 25-year run as the world's biggest semiconductor company in terms of revenue. Chances are you have a Samsung product in your life, even if it's the flash memory in your favorite smartphone.

Along with flash memory and DRAM, Samsung builds processors that act as the brains of devices, and it manufactures displays and various other components. It not only uses components it builds in its own devices, but also manufactures processors designed by customers like Apple. That business, known as a foundry, has been a growing one for Samsung. It spun its foundry business off into a separate organization over a year ago to attract even more customers.

The number of Samsung foundry customers continue to grow, Stear said Wednesday, without saying which customer is the first to use its 7nm technology. "The business is continuing to look very, very good for us," he said.

Along with Samsung's foundry news, the company on Wednesday also unveiled a new solid state drive and a higher-capacity DRAM module.

Painting with a smaller brush

Lithography is a key part of the chip manufacturing process that uses light to project patterns of circuitry onto silicon wafers. But processors currently in development require features that are smaller than the wavelength of conventional light -- like trying to paint a thin line with too large a brush.

To deal with that problem, chip manufacturers have employed a number of techniques, like running the processors through a machine multiple times to get the detail needed. But that's expensive and takes a lot of time, and it's really only a short-term bandage, experts say.

The biggest advance to speed up manufacturing, bring down the cost and make processors more power-efficient is building them using EUV. But the machines are upwards of twice as much as current machines and there have been technological issues that have taken decades to solve. ASML, the maker of EUV machines, told the Wall Street Journal in 2012 that its systems would be used in high-volume production in 2014. But the technological issues delayed that ambition.

The last two hurdles Samsung had to overcome, Stear said Wednesday, were the power of the light source and the number of wafers the machines could pump out every day.

"It's very, very critical to have a high-wattage source above 250 watts," he said. Samsung has achieved a steady 250 watt beam for over six months, he noted, and it's even demonstrated the ability to run on 280 watts, which will improve the EUV process even further.

Samsung also has made the EUV process fast enough to manufacture in high volumes.

"The break-even point is about 1,500 wafers per day," Stear said. "At this point, we're above that." He declined to give specific details.

Racing TSMC

Taiwan Semiconductor Co., better known as TSMC, beat Samsung to the market with 7nm technology, but it's not yet using EUV. Earlier this month, it said it had started using EUV in one of the early steps of chip production, according to semiconductor blog Anandtech, but the processors currently built at its factories don't use the technology.

Instead, TSMC uses something called multi-patterning, which requires up to four stencil-like patterns, called masks, to create a layer on a silicon wafer. EUV enables the use of a single mask and can reduce the total number of masks by about 20 percent, Samsung said.

Stear said Samsung's 7nm EUV technology has advantages over the techniques used by TSMC. It's more cost-effective for the chip designers and can significantly speed up the manufacturing process in chip factories, called fabs.

"We made a strategic decision that we were not going to bridge [between 10nm and 7nm EUV] with multi-patterning," he said. "We invested everything we had in EUV to get it into production."

Stear on Wednesday declined to say who Samsung's initial customers are for its new 7nm process. It's likely Samsung itself will be one of the first customers with its Exynos mobile chips.

TSMC built Apple's new X12 Bionic 7nm chip, which launched last month in the iPhone XS and XS Max. Using 7nm meant the company could stuff twice the number of circuit elements, or transistors, into the same surface area. In the case of the A12, that's 6.9 billion transistors. It's tough to understand how small a nanometer really is, but the bottom line is the advancement will let the new iPhones run graphics 50 percent faster than 2017's iPhone X, while artificial intelligence software will work 8 times faster.

A person familiar with the matter said Huawei and Qualcomm also are working with TSMC for their first 7nm chip production. The latter company said in August that its next-generation wireless processor, likely called the Snapdragon 855, would be built with 7nm manufacturing. While Qualcomm is initially working with TSMC, it's likely Samsung will eventually build some of its chips, as well.

Meanwhile, Intel, long the leader in chip manufacturing technology, has been struggling in recent years. It has delayed high-volume production of its 10nm technology by about three years to 2019 and is believed to have ousted its CEO in part because of the problems with manufacturing. (Publicly, Intel blamed a relationship with an employee.) Currently, TSMC and Samsung are the only semiconductor manufacturers working with the most advanced process technology.

Samsung

Samsung has installed EUV machines in its S3 fab in Hwaseong, South Korea. It's building another factory nearby to roll out even more EUV.

The company said that by 2020, its expects to have enough capacity with its new EUV line to build high-volume, next-generation chip designs.

Lots and lots of memory

Samsung on Wednesday also introduced a new solid state drive, called the SmartSSD. It can be programmed to address different customer needs for AI, 5G and other areas.

Importantly, it's "all about bringing that compute capability much much closer to where the data lives," Jim Elliott, Samsung corporate senior vice president of memory sales and marketing, said in an interview ahead of Wednesday's event.

"There's tons and tons and tons of data and noise," he said. "How do you sort through that and analyze it without losing time in the process?"

Self-driving cars, for instance, could benefit from the SmartSSD, as could a company's on-site data center. Elliott noted it's 3.3 to 3.5-times faster than Samsung's standard SSDs.

Samsung also unveiled a 256GB three-dimensional stacking RDIMM (registered dual in-line memory module) based on 10nm-class 16GB DDR4 DRAM. It doubles the current maximum capacity to deliver higher performance and lower power consumption. The new system will enable "larger in-memory databases and real-time analytics to solve the most complex problems," Elliott said.

And Elliott doesn't see demand for memory slowing down anytime soon. He noted that every two years, the world creates more data than all of the previous data created, combined.

"In the past, the industry was really about selling hardware, hardware, hardware, widgets and gadgets," he said. But today and in the future, the technology industry will be more about the data generated and how it's used.

"We're moving from a physical era to a data, non-physical era," Elliott said.

CNET's Stephen Shankland contributed to this report.

Updated at 4:55 p.m. PT with more information about Samsung's EUV line.

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