Integrated circuit packaging system with stack interconnect and method of manufacture thereof

A method of manufacture of an integrated circuit packaging system comprising:

• forming a connection carrier having base device pads and base interconnect pads on a carrier top side of the connection carrier;
• connecting a base integrated circuit to the base device pads and mounted over the carrier top side;
• mounting base vertical interconnects directly on the base interconnect pads;
• attaching a base package substrate to the base integrated circuit and directly on the base vertical interconnects;
• forming a base encapsulation on the base package substrate, the base device pads, and the base interconnect pads;
• removing a portion of the connection carrier with the base device pads and the base interconnect pads partially exposed opposite the base package substrate;
• and
• attaching base external interconnects to a base substrate bottom side of the base package substrate.

An integrated circuit packaging system comprising:

• base device pads having device pad surfaces coplanar to each other characteristic of being formed on a carrier top side of a connection carrier;
• base interconnect pads having interconnect pad surfaces coplanar to each other characteristic of being formed on the carrier top side;
• a base integrated circuit connected to the base device pads;
• base vertical interconnects mounted directly on the base interconnect pads;
• a base package substrate attached to the base integrated circuit and directly on the base vertical interconnects;
• and
• a base encapsulation on the base package substrate, the base device pads, and the base interconnect pads, the base encapsulation partially exposing the base device pads and the base interconnect pads opposite the base package substrate.