[HN Gopher] TSMC cancels chip price cuts and promises $100B inve...
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       TSMC cancels chip price cuts and promises $100B investment surge
        
       Author : baybal2
       Score  : 271 points
       Date   : 2021-04-01 07:06 UTC (15 hours ago)
        
 (HTM) web link (asia.nikkei.com)
 (TXT) w3m dump (asia.nikkei.com)
        
       | sschueller wrote:
       | Maybe we should start pulling chips of trashed electronics. There
       | must be hundreds of thousands decently fast chips going into our
       | trash.
       | 
       | How many dead xboxes and PlayStations have chips in them that are
       | still good?
       | 
       | I'm thinking of a reverse pick and place machine that pulls chips
       | of boards (boards that can not be used to fix other dead devices)
       | and is able to test each valuable component for later reuse.
        
         | LatteLazy wrote:
         | Moores law rules this out.
         | 
         | A PS3 only has 256mb of ram, so you need to get it out of the
         | case, remove it from the board, check it still works, package
         | it up and sell it.
         | 
         | But I can buy 2GB for 5 GBP. Can you do all the aforementioned
         | things for less than that?
         | 
         | I wonder if we could sort and melt down chips as a source of
         | raw semiconductors (I hear rare earth metal mining/refining is
         | very dirty). Maybe that would be economic?
        
         | kingosticks wrote:
         | Aren't these BGAs? Safely removing and then also re-balling
         | large non-socketed chips is tricky.
         | 
         | Do they actually have machines for this? I understand that the
         | re-work house we use do it by hand and also spend a chunk of
         | time inspecting the chip once removed since it's very easily
         | damaged. Maybe there are more automated places doing this on a
         | mass scale, we don't do it very often which might explain the
         | general poor results.
         | 
         | This video is pretty cool showing the process
         | https://www.youtube.com/watch?v=TIPO4Q9k1Zo
        
           | monocasa wrote:
           | It's tricky to do on a one off case, but once you get the
           | profiles down it's very automatable.
        
         | Nextgrid wrote:
         | It's technically possible for sure, but I would be surprised if
         | the total cost of such a process was worth it compared to
         | buying new chips in bulk.
        
         | xxs wrote:
         | >How many dead xboxes and PlayStations have chips in them that
         | are still good?
         | 
         | Those things have one big APU (with weak CPU cores), some VRM
         | and memory, GDDR5 + useless DDR3. I'd discount the APU as it'd
         | need someone to make OS support for with the blessing of
         | Sony/Microsoft. That leaves the chips of GDDR5, which can be
         | used by low end GPUs - I don't think they'd ever recoup and
         | investment and likely cheap manual labor of preheat + hot air
         | is the easier option. No idea if anyone would get a license
         | from AMD or NVidia for such GPU.
         | 
         | Edit: the capacitors would have the best value but well... I
         | cant see anyone relying on old caps for anything but repair.
        
           | eptcyka wrote:
           | You can buy a motherboard with the xbone apu in China and run
           | windows 10 on it.
           | https://www.anandtech.com/show/16336/installing-windows-
           | on-a...
        
         | baybal2 wrote:
         | > Maybe we should start pulling chips of trashed electronics.
         | There must be hundreds of thousands decently fast chips going
         | into our trash.
         | 
         | This is already been happening for decades on industrial scale
         | in countries doing eWaste recycling. Just a decade ago, you
         | could've still find people selling refurbished chips in
         | Shenzhen on every corner. Now it kinds of became a much more
         | low profile enterprise.
         | 
         | The US defence department, colloquially known as the pentagon,
         | ran a wargame scenario a few years ago to see what will happen
         | if US will be hit with a worst case scenario, years long
         | semiconductor unavailability due to sabotage of domestic fabs,
         | massive industry wide cyberattack, or something happening to
         | Taiwan.
         | 
         | One of comissioned think tanks recommended that exact methods
         | of military going door-to-door to gather old gaming console,
         | smartphones, and PCs for conversion to use in munitions, and
         | military equipment.
        
           | hyko wrote:
           | My first reaction to this plan is that it's for the birds.
           | The government would be better off just building a fab
           | themselves. The raw materials aren't that hard to get hold
           | of; integrating consumer electronics into military systems
           | would likely take just as long, if not longer (with all sorts
           | of other negative effects on quality and security). I guess
           | the analogy is with scrap metal drives in WWII, but this
           | situation is nothing like that at all. It's a fantasy
           | scenario that makes no sense.
           | 
           | We defend Taiwan with everything we've got. There is no plan
           | B, and it's not just about semiconductors.
        
             | Tade0 wrote:
             | IIRC the US navy is currently using XBox controllers:
             | 
             | https://www.theverge.com/2017/9/19/16333376/us-navy-
             | military...
             | 
             | Of course this is a far cry from ripping a SoC from a
             | smartphone and putting it into e.g a bomber drone, but I
             | assume there's much more being done - just not published.
        
               | qchris wrote:
               | I absolutely believe it-I use one professionally to
               | maneuver an underwater ROV. They're intuitive, already
               | familiar to a lot of people, and surprisingly reliable.
        
               | hyko wrote:
               | Wow. As long as they're not using joy cons I guess!
        
               | mbreese wrote:
               | One of the reasons cited for using XBox controllers was
               | the availability. If one breaks, you can find them at any
               | port. Very apropos in this context...
               | 
               | I have a vision that on a submarine there is a cable box,
               | not unlike the one that most of us probably have, filled
               | with random cables with connectors we haven't used in
               | years. And somewhere in that tangled mess is a spare XBox
               | controller. I can imagine some poor Seaman trying to
               | untangle a the controller cord so that they can use a
               | periscope. I'm sure the Navy is far more organized, but
               | it's funny to think about.
        
             | MangoCoffee wrote:
             | >The government would be better off just building a fab
             | themselves
             | 
             | OP: >years long semiconductor unavailability due to
             | sabotage of domestic fabs
             | 
             | OP said "sabotage of domestic fabs". what the govrt. lay
             | out is what happened when all else failed thus going door
             | to door to collect semis.
        
             | codeulike wrote:
             | _The government would be better off just building a fab
             | themselves._
             | 
             | But you can't just 'build a fab' can you? Thats the point.
             | You need a shipment of ASML's magic EUV machines and a
             | bunch of their engineers and a bunch more technicians and
             | managers with the right kind of skills for running a large
             | cutting edge fab.
        
               | majormajor wrote:
               | If you think there's a scenario that justifies it in 10
               | years, you start today. In our quest for ever-more-just-
               | in-time-efficiency we've forgotten that it _doesn 't
               | work_ for certain things.
        
               | dcolkitt wrote:
               | > a bunch of their engineers and a bunch more technicians
               | and managers with the right kind of skills
               | 
               | In a WWII scenario, how long does it take to rapidly
               | retrain a bunch of people with these skills. We have no
               | shortage bunch of brilliant, quantitatively minded people
               | trading derivatives and writing ML models to recommend TV
               | shows. In a total war scenario, I assume most would be
               | drafted for the war effort. Semiconductor engineering is
               | complex, but probably not so complex that your average
               | Math Olympiad couldn't pick it up in a month or two.
        
               | jjk166 wrote:
               | It's not a question of knowing how to build industrial
               | capacity, it is actually building that capacity. Before
               | you can build a fab, you need to build all the machines
               | that go into a fab, and before that all the machines for
               | building those machines, and so on and so forth. 9 women
               | can't make a baby in a month, at some point you come
               | across steps that just take time.
        
               | TimTheTinker wrote:
               | I did some materials engineering coursework in college,
               | and I think your comment significantly underestimates the
               | technical complexity of <100nm process node
               | manufacturing.
               | 
               | We _had_ many brilliant minds working on these problems
               | for decades, but it took time, skill, effort, and money
               | over these decades to achieve each milestone of
               | development. Now each of these firms (and each of their
               | suppliers) has trade secrets that go _deep_ , and barring
               | some unlikely breakthrough of brilliance, these secrets
               | can't be independently discovered by the brightest minds
               | in any less than the time it already took to discover and
               | develop them in the first place.
               | 
               | There's also the problem of supply chains -- modern fab
               | tech requires a _ton_ of downstream tech: the fab
               | machines, the parts in them, and the places those parts
               | were developed and manufactured... and the machines that
               | were required _there_ as well (repeat...). Also the raw
               | materials, especially rare earth minerals.
        
               | incrudible wrote:
               | > Semiconductor engineering is complex, but probably not
               | so complex that your average Math Olympiad couldn't pick
               | it up in a month or two.
               | 
               | We have a chip shortage going on for months now, if all
               | it took was two months and a bunch of smart people, those
               | billions of dollars in chip orders would've made it
               | happen. That tells me it has to be a bit more complex
               | than you think.
        
               | dcolkitt wrote:
               | Has any major organization started or entered the
               | semiconductor fab space in the past year? From speaking
               | with industry analysts, my understanding is we could spin
               | up additional capacity. The issue is that most everyone
               | fears the shortage will be over after the Covid supply
               | chain disruptions, and therefore any new investments will
               | not recoup their necessarily long payback periods.
               | 
               | This is a very different calculus than a WW2 type
               | scenario. Fully mobilized, the government would almost
               | certainly pay up for microchip capacity today, regardless
               | of the long-term payback residual.
               | 
               | If there was evidence of deep-pocketed firms trying and
               | failing to get into semiconductor fab in 2020, I'd change
               | my opinion. Like if Google or Amazon were trying to open
               | their own fab plants, but were failing, then I might
               | suspect that a WW2 fully mobilized war effort would run
               | into difficulties. But as far as I can tell, the issue is
               | that nobody wants to jump into the fab business,
               | regardless of the temporarily higher profits over the
               | next 2-4 quarters.
        
               | baq wrote:
               | A 10nm/7nm fab costs $10B and takes years to build,
               | assuming you've got a process which works - developing
               | that from scratch will take you a decade before you can
               | even design the fab. You could compare the enterprise to
               | a smaller scale NASA.
        
               | [deleted]
        
               | mkr-hn wrote:
               | You only need those for the latest and greatest. A lot of
               | options open up if the priority is any decently fast
               | processor over the latest. Multi-CPU systems fell out of
               | favor in the consumer space because single CPUs got so
               | fast with these processes, but multiple CPUs with an
               | older process is fine in this scenario.
        
               | elihu wrote:
               | ...or just be content with a slower chip.
        
             | AlgorithmicTime wrote:
             | They are building a fab, or at least they're having TSMC
             | build a fab in Arizona.
        
             | User23 wrote:
             | The only chance the USA has in a hot war for Taiwan is
             | using nukes to which the PRC would respond in kind. That
             | would be even worse for semiconductor availability than
             | reunification. So let's cool it with the macho idiocy and
             | instead focus on diversifying the semiconductor supply
             | chain to areas that aren't inevitably going to fall back
             | under Chinese control.
        
               | Der_Einzige wrote:
               | I'm personally willing to end the world to prevent the
               | dystopia of hegemonic china.
               | 
               | The total suffering in the world from hegemonic china is
               | far higher than in a post WW3 world. You might think this
               | is a joke but I am deadly serious. We need to take a very
               | extreme stand against techno-authoritarianism or else
               | life isn't worth living.
        
               | FpUser wrote:
               | I see that they have internet access in those
               | institutions.
        
               | foobarian wrote:
               | You should look at the stockpile sizes. Unless Russia
               | gets involved it would not be a balanced situation at
               | all.
        
               | blackearl wrote:
               | The stockpile is a ridiculous measurement. How many would
               | it take to have mutually assured destruction? A dozen?
               | One of the most worthless dick measuring contests in
               | history.
        
               | baybal2 wrote:
               | > How many would it take to have mutually assured
               | destruction?
               | 
               | In case of China, or Russia, thousands.
        
               | lainga wrote:
               | What leads you to the estimate of a dozen? Very few
               | modern warheads have multiple-megaton yields, it's less
               | efficient than many small-yield warheads.
        
               | jjk166 wrote:
               | A 100kt nuclear warhead airburst will cause moderate
               | damage to an area of 33.5km^2. Beijing has an area of
               | 16800km^2, 501 times larger. China has 160 cities with
               | over 1 million inhabitants. Even if they were all used
               | against major population centers (which they wouldn't be)
               | and all of them made it to their targets (which they
               | wouldn't), thousands of nuclear warheads would still not
               | be enough to destroy a large nation.
        
               | ethbr0 wrote:
               | Seriously. We're talking about horrible things, here.
               | 
               | But _if_ it came to a nuclear exchange, China has ~300,
               | and the US and Russia ~6,000 each. Total yield numbers
               | are harder to come by(?), so those are + /- considering
               | tactical-scale inventory.
               | 
               | Historically, this was because China's nuclear doctrine
               | was to limit their stockpile to a minimal deterrent.
               | 
               | Personally? Sitting about 40km from a priority US target,
               | I'd support the US risking a strike to guarantee Taiwan's
               | freedom.
               | 
               | Either you stand for something, or you don't. And China
               | doesn't get to claim modern territory by dusting off
               | historical documents. Hong Kong was untenable, but Taiwan
               | should be a line. If its citizens don't want to be
               | Chinese, they get to make that choice.
               | 
               | PS: Russia would probably care less about a strike on
               | China, unless China negotiated their support via treaty.
               | That ship sailed in the early 60s.
        
               | FpUser wrote:
               | >"Personally? Sitting about 40km from a priority US
               | target, I'd support the US risking a strike to guarantee
               | Taiwan's freedom."
               | 
               | Personally I'd support the US never letting people with
               | this kind of thinking anywhere near decision making. Let
               | them play stocks.
        
               | ethbr0 wrote:
               | All insistence in international politics has risk. If you
               | can't tolerate risk, you'll get pushed around by those
               | who are willing to.
        
               | FpUser wrote:
               | Respond with overwhelming force if being pushed. If
               | however you are the one starting pushing you are just a
               | bully or in this particular case fuckin' war criminal.
        
               | comte7092 wrote:
               | It's not "dusting off historical documents" it's official
               | government policy on both sides of the straight that
               | there's "one China".
               | 
               | One could argue that the only reason why the ROC hasn't
               | declared independence is because they'd fear that it
               | would provoke an attack from across the straight, but the
               | reality is that independence is not a cut and dry issue
               | in Taiwan.
               | 
               | Take some time to actually educate yourself on the issue
               | before advocating for nuclear war.
        
               | ethbr0 wrote:
               | Taiwan has been Dutch, Han, Qing, Japanese, and ROC. Any
               | appeal to history is nine^H^H^H^Hten dashes of
               | propaganda.
               | 
               | > _it's official government policy on both sides of the
               | straight that there's "one China"_
               | 
               | That's an oversimplification. The KMT / Pan-Blue believe
               | there's "one China" in the sense that they believe the
               | PRC is an illegitimate government, currently occupying
               | mainland Chinese territory that belongs to the ROC.
               | 
               | The DPP / Pan-Green believe there are two Chinas, with
               | Taiwan as an independent entity from the mainland PRC.
               | Their current official position is that this state of
               | affairs already exists, and therefore there is no need to
               | make any declarations or changes from the status quo.
               | 
               | So in summary, about one half of Taiwanese political
               | power considers the communist government as illegitimate,
               | and the other half considers Taiwan independent. Which I
               | would guess is fairly different from what the PRC defines
               | "one China" as.
        
               | comte7092 wrote:
               | This is the nuance I was calling for.
               | 
               | Yes, there are different definitions on both sides of the
               | straight. And while the independence side has gained
               | strength in recent years, the official stance has been
               | that China and Taiwan are a part of one country, however
               | defined, and, to my knowledge, no official government act
               | of the ROC has been promulgated to the contrary.
               | 
               | As I stated in my original reply, independence isn't a
               | cut and dry issue. To assert that these claims are
               | "dusty" historical claims in light of what you've written
               | here is disingenuous.
               | 
               | Edit: I should add that there is only one government in
               | Taiwan, the ROC. The stances of the individual political
               | parties cannot be taken as synonymous with the stance of
               | the ROC itself. To do so would be as ludicrous to say
               | that there's no right to an abortion in the United
               | States, because 1 of the two major political parties
               | opposes it. The most that can be said is that both
               | abortion in the US and independence in Taiwan are
               | controversial and delicate political issues within each
               | respective jurisdiction.
        
               | ethbr0 wrote:
               | > _to my knowledge, no official government act of the ROC
               | has been promulgated to the contrary_
               | 
               | The 1999 "Resolution on Taiwan's Future," since elevated
               | to DPP party platform, is crystal clear on "two Chinas."
        
               | comte7092 wrote:
               | Party platforms are not official government policy.
        
               | dalyons wrote:
               | > Personally? Sitting about 40km from a priority US
               | target, I'd support the US risking a strike to guarantee
               | Taiwan's freedom
               | 
               | What? That doesn't make sense. If the US triggered nuke
               | slinging over Taiwan the Taiwanese would be ash, not
               | free.
        
               | ethbr0 wrote:
               | Why would China nuke Taiwan?
        
               | baq wrote:
               | out of spite. they'd get glassed anyway, so why not use
               | those nukes for something?
        
               | ethbr0 wrote:
               | Because that's literally the land the hypothetical war
               | would have been started to capture? Because the casus
               | belli to their public has been that it's (PRC) Chinese
               | land by historical and cultural right? Because the entire
               | domestic and international point of provoking a Strait
               | war would be to demonstrate China's strength?
               | 
               | It's a pretty bad look if your "winning" looks like
               | "killed millions of people and rendered the land in
               | question uninhabitable for a decade+." (To say nothing of
               | the potential non-Taiwan collateral damage)
        
               | Der_Einzige wrote:
               | We can shoot down some of those nukes. Maybe china has to
               | fire 20 on taiwan before one of them gets through our
               | anti-ICBM weapons on our naval ships.
               | 
               | Means that we might come out of a war with china with
               | only a few cities lost. Might actually be worth it.
        
               | FpUser wrote:
               | >"Means that we might come out of a war with china with
               | only a few cities lost. Might actually be worth it."
               | 
               | How generous of you. Hopefully you'll be in one of those
               | cities at the moment.
        
               | unixhero wrote:
               | And retalliation would be immediate and dooming.
               | 
               | Mutually assured destruction
        
               | Leary wrote:
               | Better Dead Than Red is alive and well, hahahaha.
        
               | hyko wrote:
               | There's nothing macho about a conflict of this magnitude,
               | it would be absolutely horrible. But we have to set clear
               | expectations and unambiguous boundaries to avoid a
               | dangerous miscalculation, not pretend we have contingency
               | plans that don't actually exist.
               | 
               | There is nothing inevitable about a Chinese invasion of
               | Taiwan. My sense is that the Chinese leadership are far
               | too insightful to actually start that war, but you never
               | know.
        
               | fnord77 wrote:
               | > My sense is that the Chinese leadership are far too
               | insightful to actually start that war, but you never
               | know.
               | 
               | I think it's not too hard for a dictator to become out of
               | touch and go off the rails, mentally. Or turn paranoid or
               | whatever. Hopefully he isn't using stimulants.
        
               | Leary wrote:
               | They haven't been churning out amphibious ships that you
               | would expect them to if they thought invasion was
               | imminent.
        
           | squarefoot wrote:
           | "The US defence department, colloquially known as the
           | pentagon, ran a wargame scenario a few years ago to see what
           | will happen if US will be hit with a worst case scenario,
           | years long semiconductor unavailability due to sabotage of
           | domestic fabs, massive industry wide cyberattack, or
           | something happening to Taiwan."
           | 
           | There is also the danger of counterfeit chips. It is already
           | a plague for those of us hoping to get some good deals from
           | Chinese vendors, but the US Navy as well was hit at least
           | once with fakes.
           | 
           | https://www.justice.gov/sites/default/files/criminal-
           | ccips/l... (.pdf document)
        
           | athrowaway3z wrote:
           | I can kinda see the value of getting a million PS3 cpus for
           | in your new drone swarm or industry controllers. But how is
           | gathering generic decades old hardware going to help? For
           | Computation as a service its not that valuable or easy to
           | install. And for reuse in 'new' devices it's even more
           | questionable. All this stuff barely just works in this
           | specific configuration.
        
             | unionpivo wrote:
             | because for a lot of things you don't need that much cpu
             | power.
             | 
             | Creating something that can read several sensors (switches
             | and buttons are also sensors), and putting aggregate status
             | updates on a serial line, or displaying status lights,
             | triggering relay or something similar can be done, on
             | decades old gaming consoles, and is probably one of the
             | most common use of processors in the world today.
             | 
             | In fact it is easier than trying to use modern cpu, that
             | wasn't designed for that.
             | 
             | Not everything is about computation, in fact in terms of
             | units sold its probably a minority.
        
             | blagie wrote:
             | I'm only doing a few things on machine with around 32GHz
             | worth of processing power (# of processors * GHz) that I
             | couldn't do on my 80486 running 33MHz with a few MB of RAM.
             | Emacs starts up a little bit faster. Pages in Chrome are
             | more interactive than in Lynx, Mosaic, or Netscape. My word
             | processor fits more text.
             | 
             | On the whole, that 1000x increase in performance mostly
             | bought the ability to have most of the code that runs be
             | interpreted or JITed rather than statically compiled, to
             | play videos, to do some heavy numerics and graphics
             | (including things like family photos and videos), and so
             | on.
             | 
             | It's hard to think of anything I really /need/ in a life-
             | or-death sense or an economic-survival sense that couldn't
             | be done on older hardware with appropriate software.
             | There's a ton of things I want, that help, or where
             | migrations would be massive projects.
             | 
             | If computers were to entirely disappear, and I couldn't
             | automate things, communicate digitally (emails, messaging),
             | word process, write code, I think that'd be a major
             | systemic-collapse-level implosion of society. A lot of
             | people would simply die.
             | 
             | On the other hand, if computers were to regress to 33MHz-
             | level performance, Youtube isn't sticking around, but we'd
             | likely adapt as a society with some structural change, but
             | without such a collapse.
        
               | ip26 wrote:
               | Older levels of performance wouldn't cripple humanity.
               | But putting together something that actually works out of
               | a big parts bin is a crapshoot, and supporting a
               | deployment of machines which are each completely unique
               | is an IT nightmare.
               | 
               | We could do it if we had to, of course.
        
               | toast0 wrote:
               | I think the best chances to get something useful would be
               | to collect x86 consoles. x86 means you've got a well
               | supported target, and consoles means you've got limited
               | hardware variations.
               | 
               | Military could probably pressure Microsoft to give them
               | some way to turn an original xbox into a PC; and if you
               | give people $50 for an original xbox most will be happy.
        
               | ekianjo wrote:
               | > Youtube isn't sticking around
               | 
               | As an end user it would be manageable but dont forget
               | that the whole world runs on servers and many Industries
               | would collapse if computing power is gone
        
               | ethbr0 wrote:
               | Computational power < network connectivity
               | 
               | If we lost a few decades of processor improvements, it
               | would be about as parent noted.
               | 
               | If we lost worldwide connectivity or all undersea
               | backbones between some terrestrial networks... it would
               | be civilization-altering.
        
             | chefkoch wrote:
             | Military equipment is often more than a decade old and uses
             | far older electronics.
        
         | zitterbewegung wrote:
         | I bought a Tesla T4 on eBay. Many people will buy a set of
         | broken laptops and use the parts to make a fixed one like Like
         | Miami. Louis Rossman constantly has to find donor boards to fix
         | laptops.
        
         | monocasa wrote:
         | Xboxes and PlayStations have cryptographic chains of trust
         | going back to their on die boot ROM. You can't just pull it out
         | and use it on another Xbox or PlayStation, much less use them
         | for generic computation.
         | 
         | I think the Xbox One is the first console to have no unsigned
         | code execution at all during it's lifetime.
        
           | qball wrote:
           | You can trivially run whatever code you wanted to if you
           | seized the signing keys; I suspect that in such a "collect
           | all the general-purpose computers for general-purpose
           | computing things" that would be the first order of business.
           | 
           | Not that the government doesn't already have copies, of
           | course.
        
             | monocasa wrote:
             | I guess I didn't read a .gov mandate in what the parent was
             | suggesting.
        
         | postingawayonhn wrote:
         | What would you put them in? Everyone wants the latest and
         | greatest Playstation or Xbox with the fastest chips.
        
           | londons_explore wrote:
           | _If_ latest chips were unavailable (war, civilisation
           | collapse), we 'd do just fine with existing chips for decades
           | or maybe even centuries.
           | 
           | With clever software, you can eek much more real world use
           | out of hardware. For example, your PS3 is probably sitting
           | with its CPU idle right now, when it could be doing useful
           | computations for someone else who needs more computing power.
        
             | KMag wrote:
             | > existing chips for decades or maybe even centuries.
             | 
             | Chips experience solid-state diffusion, so I'd expect the
             | expected survival probability of chips (ignoring any infant
             | mortality effects) to go something like feature_size /
             | sqrt( time ). If this is true, then I'd guess modern
             | process nodes would have very low survival rates out at 100
             | years. Though, it's been over 20 years since I had any
             | solid state chemistry, and most of my experience with
             | diffusion modeling is in financial models, so take my wild
             | guess with a grain of salt.
        
               | londons_explore wrote:
               | But the failure rate in observed time for non-nand
               | components is very very low.
               | 
               | Take a 5 year old phone, and the chances of the main
               | board being bad might be 10%... But the chances of the
               | main CPU being bad is probably under 0.1%. The other 99%
               | of failures are mostly water damage, physical damage, bad
               | soldering, fatigue failure, bad nand, etc.
               | 
               | Maybe they'll all fail at once, but I somehow doubt it.
               | IC's from the 1970's are still going strong, also with a
               | low failure rate.
        
             | swiley wrote:
             | You don't have to be clever (unless you're talking about
             | video games), just not completely reckless.
        
         | IshKebab wrote:
         | Completely pie-in-the-sky. Chips aren't fungible.
        
           | imtringued wrote:
           | Yeah, we would have to assume a post-fab apocalypse where we
           | dig out electronics from a landfill for it to be economically
           | viable.
        
           | rasz wrote:
           | Yet here we are https://www.youtube.com/watch?v=qNje63vx73s
           | Chinese "Motherboard" made using salvaged VRMs and
           | transistors, salvaged capacitors, salvaged Intel Chipset!,
           | and made to work with retired Intel Xeons and older DDR3 ECC
           | memory.
        
         | throwaway4good wrote:
         | Kettle chips are really good and made in the UK.
        
           | alexgray1415 wrote:
           | Get out!
        
             | throwaway4good wrote:
             | Serious answer: Reusing old components makes no sense as
             | the changes in technology are too big (say from a PS3 which
             | has 45nm chip to a 7nm PS5 cpu). However you can keep using
             | your playstation for longer as the new one will be more
             | expensive or harder to get.
        
           | jonplackett wrote:
           | NEW 5nm Kettle Chips! I'd buy some.
        
       | LatteLazy wrote:
       | Careful setting next year's quotas based on last year's
       | shortages...
        
         | carlmr wrote:
         | True, but where do you see demand dropping off? I would
         | actually assume demand will go up even more, since the economy
         | was slowed down due to the pandemic.
        
           | bsder wrote:
           | > True, but where do you see demand dropping off?
           | 
           | Likely December.
           | 
           | Right now, because everyone is fearful of shortages, they've
           | overbought or are in the process of overbuying.
           | 
           | At some point, everyone is going to realize that, in the US,
           | carrying inventory has tax implications, and everybody is
           | going to try to dump a bunch of inventory back into the
           | system that they really didn't need and aren't prepared to
           | pay taxes on.
           | 
           | Which will be fine for a while--until the middlemen get back
           | up to what they consider useful inventory levels and quit
           | buying. And all the prices will crash.
        
             | iopq wrote:
             | For TSMC there's very little risk
             | 
             | This is because a newly competitive AMD takes up a ton of
             | wafers. They can't make them fast enough, and in 2022 they
             | are releasing a completely new platform with DDR 5 on 5nm,
             | and presumably new GPU line.
             | 
             | This should again clobber Intel 10nm products. Even if
             | there's no chip shortage, the customers of TSMC are very
             | healthy (AMD, Apple, other phone manufacturers).
        
             | rcxdude wrote:
             | Who's keeping inventory? Certainly for consumer channels
             | there's basically no inventory to be had.
        
               | bsder wrote:
               | End companies, themselves. Any inventory that shows up
               | gets overbought immediately. Two companies I know have
               | x10 the microcontrollers they need for the year because
               | they overbought when they could.
               | 
               | If they pushed those microcontrollers back right now,
               | they'd make quite a nice profit. But they won't.
               | 
               | Instead, those companies will hit the tax implications
               | starting in December and _then_ will try to push their
               | overbought inventory. Of course, at that point
               | _everybody_ will be trying to push their inventory and
               | the prices will crash.
        
           | rasz wrote:
           | Crypto bans would free a large portion of GPU demand.
        
           | foolmeonce wrote:
           | I think the changes pushed people to invest in new devices,
           | etc, for a per-user lifestyle, while going back to
           | restaurants, meeting rooms, etc, there's an excess of second
           | hand inventory.
        
             | Shivetya wrote:
             | oh I bet many are going to find the opportunity provided by
             | the equipment gives them a lot of flexibility with work but
             | also to communicate with friends and family. Many had never
             | considered using zoom, their ipads, and other means, to
             | keep in touch. The visual aspect may finally lead to where
             | people will desire phones calls are both audio and visual.
             | 
             | maybe the video phone will become an actual reality instead
             | of something most people only see on TV and in movies
        
         | bigdogc wrote:
         | I don't think the shortage will be over in the next 2-3 years
         | at the least. This is a huge problem that the media only
         | briefly covers. Biden just announced 25b to semiconductors bc
         | homeland security knows we have major flaws in the supply
         | chain.
        
         | Wohlf wrote:
         | This isn't about next year though, this is about planning
         | capacity for the next decade at least.
        
       | Hypx wrote:
       | This reminds me of Moore's Second Law, namely that the cost of
       | maintaining Moore's Law will itself follow an exponential growth
       | curve. You figure there will come a date where any attempt to
       | maintain Moore's Law will become so expensive that there's no way
       | it can avoid slowing down drastically. At which point the
       | semiconductor industry will behave like other heavy industries
       | and improves at a much more modest rate.
        
       | MangoCoffee wrote:
       | 1. can we afford to just build fab without consideration of
       | profit? what you going to do when you can't turn a profit with
       | all the fabs in the US?
       | 
       | 2. TSMC and the rest of the foundry industry are exposed to the
       | highly cyclical nature of the semiconductor industry. we are
       | seeing the high demands for chip because of covid and car
       | vendors' f'ck up. what you going to do with all the fabs build in
       | the US when you are hit with downturn?
       | 
       | we saw Intel struggle with 10nm and 7nm delay. i think its wiser
       | to invite fab company like TSMC and Samsung to build fab in the
       | US even with smaller capacity.
        
         | dirtyid wrote:
         | Some choice quotes from Mark Liu, chairman of TSMC this week
         | agreeing with you:
         | 
         | * "It's economically unrealistic for all the countries to build
         | additional chip production capacity,"
         | 
         | * "Uncertainties led to double booking, but actual capacity is
         | larger than demand," How quickly those concerns are resolved
         | "really depends on future U.S.-China negotiations."
         | 
         | * each country developing its own domestic semiconductor
         | industry would lead to a lot of "nonprofitable" capacity.
         | 
         | >what you going to do with all the fabs build in the US when
         | you are hit with downturn?
         | 
         | Priority sourcing from domestic fabs, let TSMC whither, by
         | design. Semi is oil now, there's more strategic/geopolitical
         | considerations than supply/demand curve. US/EU/CN do not want
         | Taiwan to have semi dominance, it's not in anyone's interest.
         | Current TSMC position is happenstance due to poor industrial
         | policies that countries are scrambling to address. IMO press
         | releases and capex spending around Arizona announcement suggest
         | TSMC wasn't prepared to built US fab, let alone 6. US pressured
         | them, EU failed to. There's a good chance TSMC/Taiwan will try
         | to delay their silicon shield evaporating for as long as they
         | can. Probably not a coincidence big ticket US weapons sales are
         | scheduled around when fabs would be up.
        
         | ip26 wrote:
         | 1. Yeah, we certainly could, but profit is what got us from
         | 50um to 3nm.
        
       | bigdogc wrote:
       | How much would it cost to start a design semiconductor business?
       | On the low end of the budget.
        
         | clarifier123 wrote:
         | I don't know how much would it normally cost, but the EU is
         | spending 145 billion EUR to kick-start it:
         | https://www.eetimes.eu/eu-signs-e145bn-declaration-to-develo...
        
         | mastax wrote:
         | You can read around the parallax propeller 2 forums for an idea
         | of what it takes on the low end - they were very open about the
         | process. IIRC they have one guru who does software and Verilog,
         | one who does RTL layout (term?) and the rest are support staff
         | who do other things at the rest of the company most of the time
         | (PCB designer, assembly, sales, HR, etc.)
         | 
         | The raspberry pi pico team also did a good podcast episode
         | talking about this - I think it was a podcast called innovation
         | coffee or something like that. Hosted by a guy from ARM Europe.
        
         | orbifold wrote:
         | The professional tools are licensed at 100k-200k/year per seat
         | each, there is no way around them if you want to actually tape
         | out the chip. An experienced backend engineer needs 3-4 months
         | to take a design from Verilog to a file that can be send to a
         | Foundry. You also need access to a PDK from a manufacturer like
         | TSMC and probably will have to license some of the digital-
         | analog components (PLL, IO-Pads) from someone. Manufacturing
         | itself is fairly expensive as well, we taped out via
         | europractice ( https://europractice-ic.com/schedules-prices/),
         | you pay about 12k per square millimetre in TSMC 65nm. Even
         | older processes are more affordable, but you have to keep in
         | mind that each of them requires at least some customisation and
         | access to blocks specific to the process (memories for
         | instance).
         | 
         | On the design and verification side the story is slightly
         | better, verilator (https://www.veripool.org/wiki/verilator) for
         | instance is an excellent tool that lets you simulate system-
         | verilog code with high performance. It has seen wide industry
         | adoption in the last years and now a couple of companies like
         | Google, SiFive, etc. are investing in open source tooling for
         | hardware. You can go a long way to building your design without
         | having to pay for expensive licenses. The downside is that most
         | of the interface type components (PCI-Express, DDR4, etc.) are
         | prohibitively complicated to build yourself, so you will need
         | to rely on external IP at some point.
        
           | baybal2 wrote:
           | > The professional tools are licensed at 100k-200k/year per
           | seat each, there is no way around them if you want to
           | actually tape out the chip.
           | 
           | Unless you talk about countries where people simply don't pay
           | for software no matter what.
           | 
           | Some companies are just fine with 10 years old pirated
           | Virtuosos in places like China.
           | 
           | It was a big surprise to me that even software which probably
           | has less than 100 licensees globally is still getting
           | warezed.
        
             | orbifold wrote:
             | Yes, I can totally believe that, the software itself is
             | actually distributed in a fairly convenient format, given
             | that some of it is only compatible with some obscure RedHat
             | version, so installation amounts to copying files from an
             | iso image and pointing it to a license server. It probably
             | is also easy to patch out the License server code. I would
             | be fairly surprised if those places also had access to
             | current gen PDKs and the required memory compilers. We have
             | to basically order memory blocks by mail and don't get
             | access to the tools to generate them ourselves.
        
           | madengr wrote:
           | 100k-200k is low. I know a full suite of the 500 pound
           | gorilla is $550k.
        
         | swiley wrote:
         | It depends pretty heavily on the semiconductors you want to
         | produce, if you want to replicate the technology of the early
         | 60s people have done that in their kitchen (see cooking with
         | Jerry for an example.)
        
         | pjc50 wrote:
         | _Manufacturing_ you 'd need billions and the support of your
         | government. But a _design_ business? There 's quite a lot of
         | those around.
         | 
         | Bare minimum estimates, working backwards:
         | 
         | - $? for marketing and distribution, physical inventory costs
         | 
         | - $100k/y for one field engineer (FAE)
         | 
         | - $250k for first successful manufacturing run
         | 
         | - $250k for first full mask run with bugs
         | 
         | - $100k bringup boards, test equipment, engineering time fixing
         | it
         | 
         | - $25k shuttle run for initial testing. This will find at least
         | one bug.
         | 
         | - $100-200k outsourced layout: this is boring, specialised, and
         | low value-add, so get someone else to do it
         | 
         | - $500k/y misc software and testing staff or consultants
         | 
         | - $100-500k/y each: 3-5 senior design engineers. For best
         | results, these are people you already know and are spinning out
         | of their job at Big Boring Semi Co
         | 
         | - optional $100k really big FPGA + software + custom boards
         | 
         | - $250k/y software licenses from Cadence or Synopsys, unless
         | you're very brave and want to try the open source flow
         | 
         | - IP licenses. Not just obvious things like ARM cores, but
         | analogue or semi-analogue IP like high-speed transcievers.
        
           | icefo wrote:
           | Do you know how it is to work on software in this industry ?
           | Be it for the tools or embedded software programming or in
           | VHDL / verilog.
           | 
           | I'm still in university and I've always liked hardware and
           | low level related stuff but I've heard bad things about
           | software in hardware companies like Qualcomm.
        
             | baybal2 wrote:
             | The wage disparity in between semi industry at large, and
             | almost everything else is a matter of legends...
             | 
             | Almost every part of semi industry is very bad on effort to
             | salary ratio, and players like Intel, or Qualcomm are far
             | from the worst, they actually do very well on salary front,
             | and attracting talent. It's Asian companies who score the
             | worst on that.
             | 
             | TSMC process development job is 100:1 lottery win + 20
             | years of your life for $50k a year salary. Know people with
             | first hand experience of that.
        
             | pjc50 wrote:
             | I'm quite happy at Cirrus doing tools, but I'm aware that
             | they are an outlier who put effort into staff happiness.
             | 
             | In many other places software is an afterthought to the
             | hardware, and it shows.
        
           | baybal2 wrote:
           | Excellent description, I wished I could've pushed your
           | comment higher.
           | 
           | People are always shocked when I tell how tiny is the semi
           | industry, but it really is.
           | 
           | Besides the super-concentration of semi manufacturing which
           | starts to get more coverage, designs needs some exposure too.
           | 
           | When Apple bought PA Semi, it went rather unnoticed, but
           | people didn't know that the amount of logic designers of a
           | such calibre who can design cores like ZEN, or Firestorm is
           | probably less than 100 in the whole of North America.
           | 
           | Sounds very dramatic, but America is less than 100 senior
           | logic designers away from getting out of design business too.
        
           | FullyFunctional wrote:
           | the software license number is off by a large factor for
           | leading edge nodes. large!
        
         | throwaway4good wrote:
         | There was this a while back:
         | 
         | https://news.ycombinator.com/item?id=23755693
         | 
         | Google offers free fabbing for 130nm open-source chips (fossi-
         | foundation.org)
        
         | baybal2 wrote:
         | > How much would it cost to start a design semiconductor
         | business? On the low end of the budget.
         | 
         | A decade ago, it would've taken you $1m in China for a 50/50
         | shot at it.
         | 
         | If your first tapeout works, you will make money, if not... you
         | wasted $1m.
         | 
         | $1m looks like pocket change to most American tech people now,
         | but the fabless trains has long since departed.
         | 
         | You will need a sum with few more zeroes, to get a jumpstart in
         | the industry now.
         | 
         | There was 4-3 years long extreme consolidation push in the
         | industry, with big swallowing dozens producers of commodity
         | products. It is very reminiscent how the demise of American oil
         | industry happened when the industry gone from thousands of oil
         | producers, to less than 10 in one decade. Everybody bets now
         | that there will be 10-15 or so mega-fabless running the
         | industry in coming decade.
        
           | londons_explore wrote:
           | It massively depends what you want to build...
           | 
           | There are plenty of designs where just $10k will get you an
           | ASIC built in some university... It won't be anything like
           | leading edge silicon though, but for some products that's all
           | you need.
        
             | baybal2 wrote:
             | > There are plenty of designs where just $10k will get you
             | an ASIC built in some university
             | 
             | With a few micron university process? Yes, can you
             | commercialise it? No.
             | 
             | I believe 180nm has for long been the limit of how
             | "commercially viable" is defined even for stuff like
             | analogue, and discrete logic ICs.
        
         | qbasic_forever wrote:
         | To build chips similar to what TSMC produces (i.e. some of the
         | most cutting-edge fab tech in the world)? Hundreds of billions
         | of dollars. Decades of experience. Growing silicon crystals and
         | turning them into transistors barely bigger than a few dozen
         | atoms is immensely difficult. And then turning that into a
         | process you can repeat with precision and churn out at high
         | yield is another enormous hurdle.
        
           | staticassertion wrote:
           | Serious question as someone totally naive on this. A few
           | hundred billion dollars seems like an extremely good deal to
           | lead this area of technology - why don't we see funding for
           | this at a government level? I mean, we now have a 2 trillion
           | dollar infrastructure plan.
           | 
           | Is there an impediment I'm not aware of? Or maybe it's not as
           | good of a deal as I think?
        
             | nindalf wrote:
             | > why don't we see funding for this at a government level
             | 
             | Because America fell asleep at the wheel while Taiwan did
             | not. TSMC and other Taiwanese chip manufacturers benefited
             | from a government that saw the need to be a part of high
             | value manufacturing. Meanwhile America of the 90s and 2000s
             | assumed that it would be the most powerful country in
             | perpetuity and so it wouldn't matter where something was
             | being produced as long as they could pay for it.
             | 
             | The events of the 2010s has shown the flaws of this
             | thinking. It is now possible for American firms to be cut
             | off completely from semiconductor manufacturing, similar to
             | how Huawei was cut off. There is now support from the
             | American government to restore semiconductor manufacturing.
             | They are footing a part of the bill for TSMC's new plant.
             | I'm sure Intel's lobbyists are skilled enough to get part
             | of their new plants paid for as well. China is doing the
             | same - the state has deployed all it's resources behind
             | SMIC to ensure that what happened to Huawei never happens
             | again.
             | 
             | It's more complicated than this though. You don't just need
             | semiconductor fabs, you also need rare earth metals, almost
             | all of which is mined and refined in China. America is
             | attempting to reshore this too
             | (https://www.economist.com/finance-and-
             | economics/2021/03/31/g...)
        
               | throwawayzRUU6f wrote:
               | > need rare earth metals, almost all of which is mined
               | and refined in China
               | 
               | This is usually presented as an ace up the sleeve that
               | China has secured through shrewd strategic thinking. In
               | reality, rare earth metals are neither particularly rare,
               | nor are they expensive, nor are they in high demand.
               | 
               | Rare earth metals are more common than silver or mercury,
               | somewhat rarer than cobalt. The ones with excellent
               | magnetic quantities go for ~$50 per kilo (allegedly only
               | 200g is required per electric car), the ones used for
               | catalysts and alloy making go for as low as $2 per kilo,
               | cheaper than copper.
               | 
               | They're not nearly as much of a constraint as claimed.
        
               | shigawire wrote:
               | My understanding is that they are hard to extract
               | economically without destroying the environment. Also I
               | believe more come from Brazil now anyways?
        
               | qchris wrote:
               | This is my understanding as well; one of the reasons why
               | China has such a high percentage of that market isn't
               | because no one else can, but rather that they don't want
               | to. The environmental damage is often horrendous [1][2]
               | so everyone that can outsources it. I believe there's
               | also been a lot of work on reducing or replacing relience
               | on those materials in quite a few areas, as I believe a
               | parent comment mentioned.
               | 
               | [1] https://e360.yale.edu/features/china-wrestles-with-
               | the-toxic...
               | 
               | [2] https://www.bbc.com/future/article/20150402-the-
               | worst-place-...
        
               | BuckRogers wrote:
               | Intel's new fab is in the US (where I reside), I hope
               | they get subsidized as I'm worried about our
               | manufacturing capability across the board. It's affecting
               | what I'm looking to purchase as well, having a few issues
               | with my Ryzen 5900X system and instability matters far
               | more than performance so I'm thinking hard to an Intel
               | alternative. "Slow" but stable, and investing in the US?
               | Sign me up.
        
             | qbasic_forever wrote:
             | Modern semiconductors were invented in America, literally
             | why we call it Silicon Valley. We used to have the best
             | fabs in the world but 80's and 90's corporate American
             | business culture decided it was better to shut down all
             | that manufacturing and move it overseas for more short-term
             | profit. They're now coming to the hard realization that
             | maybe that was a massive mistake.
        
               | rcxdude wrote:
               | The story is not anywhere near that straightforward for
               | semiconduction fabrication. A huge portion of that
               | fabrication, for example, just moved out of california to
               | other places in the US. Also there's been a general
               | consolodation of fabrication plants over time as more and
               | more advanced nodes put the price of a plant up by orders
               | of magnitudes. There just isn't enough money for the same
               | number of fabs at the bleeding edge. Also, intel are
               | still US based manufacturing and they have only quite
               | recently been toppled from the throne of most advanced
               | process. They have simply lost to the advancement of
               | overseas tech companies (generally it seems because they
               | made a bad bet on their strategy for further shrinks to
               | their process), nothing to do with US companies
               | outsourcing overseas.
        
               | sfifs wrote:
               | > There just isn't enough money for the same number of
               | fabs at the bleeding edge.
               | 
               | There definitely is but it will come at the cost of share
               | buy backs and keeping share price up which affects
               | compensation of management. Failure to keep the share
               | price up by investing in manufacturing in US will also
               | invite predatory share holders to topple the management.
               | The cult of "free" markets driving wealth growth at the
               | top of the society seems to have trumped strategic common
               | sense.
        
               | Gibbon1 wrote:
               | 20 years ago I had the line, American businessman and
               | political leaders are stupid. Because they think they own
               | those factories in China and the far east.
        
               | cbozeman wrote:
               | > but 80's and 90's corporate American business culture
               | decided it was better to shut down all that manufacturing
               | and move it overseas for more short-term profit
               | 
               | This is a very non-confrontational way to say, "Greedy
               | ass Boomers who were given practically everything by the
               | events surrounding the end of World War II -
               | manufacturing destroyed across all of Europe, Asiatic
               | nations still mostly third-world places, second world at
               | best, managed to fuck up so badly due to greed and
               | incompetence while growing up in a world with, literally,
               | no competition, sold their children and their
               | grandchildren down the river so they wouldn't have to be
               | even slightly uncomfortable in retirement, unlike their
               | parents."
               | 
               | This just furthers my belief that if you couldn't make an
               | above-average life for yourself as a Boomer, you were
               | just a pathetic fuck-up who would have probably starved
               | to death 100-200 years ago.
        
               | iopq wrote:
               | Huh?
               | 
               | Samsung and TSMC are home-grown in their respective
               | countries and Intel still makes chips. Together, they
               | make the majority of the world's chips.
        
             | orbifold wrote:
             | The US is heavily investing in that, there are recent DARPA
             | programs (POSH, IDEA, SHIELD, SAHARA, ...) addressing this
             | and continuous government investment in semiconductor
             | technologies.
        
             | kwere wrote:
             | having skilled peoples at every org level capable to do the
             | job is the most difficult part. Any gov could spend
             | Trillions and still get little in return
        
             | MangoCoffee wrote:
             | >why don't we see funding for this at a government level?
             | 
             | China big fund 2014 yield nothing. SMIC still have to poach
             | TSMC engineers to get them to 14nm. we'll see how China big
             | fund II going to do.
             | 
             | U.S. govrt is dumping money into semis by asking TSMC and
             | Samsung to open fab in US and Intel is gunning for US
             | govrt's money by going IDM 2.0.
        
             | elsjaako wrote:
             | I'm not sure if you are referring to the US specifically,
             | but there are governments doing this.
             | 
             | https://www.reuters.com/article/eu-tech-semiconductor-
             | idUSKB...
        
             | insert_coin wrote:
             | One word: Financialization.
             | 
             | The 70s started the trend of financializing (is that the
             | word?) everything, that meant that at every step of every
             | productive process someone packaged it into a tradable
             | "paper", which got packaged with other paper from other
             | productive processes and then re-sold and repackaged again
             | and again to the market as proxies of the value from those
             | productive processes.
             | 
             | Holding paper assets turned out to be much more lucrative
             | than the actual production for most companies, not to
             | mention far far easier than competing in the market with
             | products and innovation, so naturally it slowly began to
             | chip away at the quality of the production in favor of
             | holding paper that represented production. Outsourcing
             | became possible and they noticed it didn't matter to the
             | ones buying the paper assets who actually did the work, so
             | it skyrocketed.
             | 
             | Financialization required an immeasurable amount of debt,
             | they began extending credit to anyone so they could buy
             | said paper, and then turned around and made the debt itself
             | financial paper.
             | 
             | That got us the stock market booms of the 80s, the 90s, the
             | dot com, the financial crisis, and of course their busts.
             | 
             | Now we are at the end, and the signal? companies are adding
             | bitcoin to their balance sheets. The cycle of
             | finacialization is complete, paper is no longer required
             | and you don't even have to outsource your production, not
             | that you have it anyways, as all you need to post profits
             | and pretend you are a good CEO is buy crypto and hodl.
             | 
             | Production for a 'modern' business is rapidly becoming a
             | thing of the past. Governments can try to buy their way
             | into any market but it is useless; most businesses have no
             | real capacity to compete delivering cutting edge products
             | with actual real "bare-metal" profitable businesses because
             | they can only make profits "on paper".
             | 
             | (sorry if finacialization is not how it's written)
        
               | Guthur wrote:
               | Doom doom money doom doom. Nonsense.
               | 
               | Top 10 companies
               | 
               | https://fxssi.com/top-10-most-valuable-companies-in-the-
               | worl...
               | 
               | Most of these are providing goods and services that 100s
               | millions of people are getting value from, with the
               | possible exception of Facebook :p
               | 
               | As an aside I must admit I had never heard of Delta
               | Electronics before at all; nearly 50 years old and 5th
               | most valuable company.
               | 
               | Out of the top 10 you do get some pure play financial
               | companies like Berkshire, Morgan Chase, Visa (maybe).
               | 
               | Cutting edge semi conductor manufacture is arguably some
               | of the most advanced technology and manufacturing we do
               | at scale. It's just plain hard hard. The equipment, the
               | expertise, the lead time to manufacture, it's all big
               | scale problems.
               | 
               | Relatively speaking getting manufacturing of old node
               | sizes would like not be remotely as hard, 32nm maybe even
               | 16nm.
        
               | kcb wrote:
               | That list is wildly incorrect. Delta Electronics doesn't
               | have anything remotely close to a 1.4T USD market cap.
        
               | insert_coin wrote:
               | Those companies, maybe with the exception of Facebook and
               | Microsoft, are literally only possible because of paper
               | money. Take out the paper they hold from their balance
               | sheets and their size goes down in half. Take away their
               | ability to own their markets by issuing debt bonds, which
               | would mean competing with the revenue generated by their
               | own products, and you kill them.
               | 
               | Apple became the biggest company in the world not only
               | because they create products everyone wants, but equally
               | because they are masters at managing money and debt. That
               | is what gives them the edge in production as they barely
               | produce anything. They are probably the best at managing
               | financial assets by far.
               | 
               | And Tesla, well Tesla is very bad at building cars, they
               | are bankrupt without paper profits. They shouldn't be on
               | that list.
               | 
               | Semiconductors is not harder than any other cutting edge
               | industry that has come before. Taiwan is not special,
               | they are 20 million people. A good chunk of them trained
               | and educated in the US.
        
               | sfifs wrote:
               | Also note that as far as hardware production is
               | concerned, Tesla is the only company on that list that
               | actually manufacturers anything at scale in the US
               | anymore.
        
             | pjc50 wrote:
             | The US dominant ideology is _private_ enterprise, not
             | government enterprise. This is why the US does not even own
             | its high-tech weapon manufacturers, preferring to have
             | Boeing, Raytheon and Lockheed-Martin at one remove. Of
             | course, they wouldn 't exist without government money, but
             | they're private companies with private shareholders.
             | 
             | So when you're talking a few hundred billion dollars for a
             | US-first technological capability, the important question
             | is who will get the money and how will they be held
             | accountable for delivery? What, even, are they expected to
             | deliver - no use if the plant is more expensive than TSMC
             | so everyone chooses them anyway.
             | 
             | The history of these initiatives is not great:
             | https://www.wyomingpublicmedia.org/post/foxconn-
             | promised-130... (Republican)
             | 
             | https://fortune.com/2015/08/27/remember-solyndra-mistake/
             | (Democrat)
        
           | amelius wrote:
           | Yes, but the question was about a design business, not start
           | a new fab.
        
         | inglor_cz wrote:
         | Equipment = billions.
         | 
         | A bunch of talented people with experience who can use the
         | equipment productively = priceless. Probably can't be bought,
         | otherwise some countries would already have done it.
        
           | povik wrote:
           | The question is about design of chips, not manufacturing.
           | That is quite the difference in the market that has
           | developed.
        
           | exhilaration wrote:
           | The (mainland) Chinese are buying as much TSMC talent as
           | possible [0] so don't count them out just yet. It turns out
           | everyone has a price.
           | 
           | [0] https://www.google.com/search?q=china+hiring+tsmc
        
       | georgeburdell wrote:
       | Selfishly... so will all this CapEx by TSMC, Samsung, and Intel
       | put pressure on wages? I'm in the industry at a large company
       | getting 3% raises, 10% of comp as stock, and a salary about 1/3
       | less than a software dev. All while being highly reviewed.
       | 
       | I write a lot of software for my job (although it's not my title)
       | and I've been thinking of trying for pure software jobs even if
       | the work is more boring (I do semiconductor R&D)
        
         | BeetleB wrote:
         | > I write a lot of software for my job (although it's not my
         | title) and I've been thinking of trying for pure software jobs
         | even if the work is more boring (I do semiconductor R&D)
         | 
         | This sounds like me in a past life. I assure you: It's worth
         | the change. (Often) Easier work. Paid more. Treated better.
         | Nicer work environment. It's worth it even if the pay were the
         | same.
         | 
         | Also, with SW roles in your resume, you can then find jobs
         | outside the semiconductor industry. Lots more options available
         | to you.
        
         | ed25519FUUU wrote:
         | 3% raise a pretty typical for software engineers as well.
        
           | justsid wrote:
           | 3% raise of 50k is much less than 3% of 150k though. GP could
           | get a hella big pay bump and then much larger raises if he
           | switched, even if on paper it's still the same percentage.
        
         | throwawayiIiIII wrote:
         | I also find it surprising that Hardware Engineers have a lower
         | pay scale (Although I didn't hear very big differences like you
         | said). Is there some kind of supply-demand behind this?
         | Engineers for car-related things as well. Anecdotally I think
         | you could in theory get a title change to software engineer,
         | while doing the same thing, to get more pay.
        
           | kccqzy wrote:
           | There are big differences. A close friend who's a hardware
           | engineer shared with me her salary. With five years of
           | experience and a MS, her salary is the same as a fresh-out-
           | of-undergrad junior software engineer at the same company.
           | That's $120k in the valley.
        
             | kbelder wrote:
             | Huh, I'm surprised. As a software guy, I think the hardware
             | engineer has a tougher job that requires more skill.
        
               | BeetleB wrote:
               | It is tougher, but how tough a job is has little to do
               | with the pay.
               | 
               | It's all about supply/demand ratio, which is higher for
               | hardware engineers. Hence they get paid less. There are
               | simply far fewer HW jobs than SW ones. While there are
               | more SW engineers, it doesn't make up for the delta in
               | number of jobs available.
               | 
               | Even within the SW world, I've jumped around jobs of
               | varying difficulty. The tougher jobs did not pay more.
        
         | coryrc wrote:
         | I switched for the money
        
         | musingsole wrote:
         | I switched for the flexibility (only a few hardware players
         | versus a seemingly endless list of software shops) but the pay
         | bump has been nice.
        
       | heisenbit wrote:
       | The expected price reductions will have been part of the
       | financial modelling for products. Big customers of TSMC is Apple
       | which traditionally build the best products with the best inputs
       | and then sells them for quite some time benefiting from lower
       | input costs.
        
       | tempfs wrote:
       | I am wondering if this concentration of capacity in Taiwan with
       | China looming over it is really such a great idea.
        
         | vkou wrote:
         | It's been a great idea for Taiwan, and it's been a great idea
         | for price sensitive consumers, who don't give two figs about
         | where in the globalized marketplace their products come from.
         | 
         | Whether it's been a great idea for someone who _isn 't_ a price
         | sensitive consumer doesn't matter - markets don't optimize the
         | world for the comfort of ideologues. You can't sell ideology.
         | 
         | If China were to successfully annex Taiwan, there would be two
         | likely outcomes.
         | 
         | 1. China would be difficult to sanction, because in a world
         | with chip shortages, we can't drop our reliance on TSMC fabs.
         | (See, also, Russia selling oil and gas to the EU, despite
         | sanctions on it. Given the option to take the moral high
         | ground, and using Russian natgas to not freeze to death in the
         | winter, Germans are taking the latter, while the Department of
         | State gnashes it's teeth.)
         | 
         | 2. Or, as some posters on HN gleefully speculate, the TSMC fabs
         | will be destroyed, either by TSMC, or by the United States. I'm
         | sure that will be quite cathartic for all of thirty minutes,
         | until we all realize that we're in for a multi-year chip
         | shortage that makes today's problems look like nothing. Hope
         | everyone's looking forward to half the supply, and quadruple
         | the prices.
        
         | fastball wrote:
         | TSMC is building a fab in AZ.
        
           | knowaveragejoe wrote:
           | While true, if I recall correctly that fab will be a tiny
           | minority of TSMC's overall output.
        
       | ksec wrote:
       | 1. TSMC were spending ~$30B per year on capital expenditure
       | already.
       | 
       | 2. Since leading edge node is forever increasing in cost, the
       | next 3 years, i.e 3nm in 2022 and 2nm in 2024 are expected to be
       | higher. ~$100B investment aligned with their initial plan / trend
       | / target anyway.
       | 
       | 3. So really the major news is stopping ( or to be precise,
       | delaying ) price reduction. Which is unusual but understandable
       | given the current demand situation. And No, it is not TSMC's
       | fault. You should ask how every single Fabless Semiconductor
       | company has failed with their demand, supply chain analysis and
       | projection. Although one could argue it is not their fault
       | either, since their client gave wrong projection. The only
       | company that is not affected is possibly Apple.
       | 
       | 4. There has been mounting pressure from investors, politicians
       | and MSM media on Intel IDM 2.0, and supply problems. This
       | announcement feels more like addressing those concerns.
       | 
       | 5. Remember both Samsung _and_ Intel are expanding capacity. And
       | even GF and many other smaller players. It took DRAM and NAND
       | three years to catch up with demand ( and then over supply ).
       | Which in hindsight is pretty damn impressive. Although during the
       | ~2016 - 2019 everyone felt awful.
        
         | gumby wrote:
         | > The only company that is not affected is possibly Apple.
         | 
         | This is an interesting point. Apple is pretty hard nosed on
         | their predictions and capacity reservations, to the point where
         | they could be funding part of this expansion at TSMC (as they
         | have done for Hon Hai, among others, for decades).
         | 
         | I continue to be astonished by Apple's ability to manage their
         | supply chain so tightly (which requires not just an iron fist
         | but very very intense internal process). They seem to be the
         | only ones who can manage to do that.
         | 
         | And it's not like other big companies are lazy; the part that
         | really amazes me is that their process hasn't leached out to
         | other companies, as so much else does in the Valley.
        
           | mooman219 wrote:
           | Apple is experiencing supply chain issues, and there is a
           | shortage of laptop devices right now if you try to make bulk
           | orders (>1000 units). I have no context on their phones.
        
           | somethingwitty1 wrote:
           | I just saw something about this. The reason Apple hasn't been
           | impacted is because their sales have been dropping for the
           | past few years on iPhones and other devices. That trend
           | hasn't changed during the pandemic. While many of the other
           | players predicted drops during the pandemic, and initially it
           | did, that demand dramatically increased, especially in the
           | desktop market (AMD, Nvidia, etc). It is hard to fault
           | companies from predicting the massive increase in a market
           | that has been decreasing for decades(?) now. There is limited
           | capacity at TSMC and Samsung. They leave buffer, but that was
           | quickly consumed because almost everyone needed more
           | capacity. It takes potentially years to increase capacity
           | (build a new fab, etc), they have no room to allow any
           | companies to adjust their capacity reservations.
           | 
           | So at the end of the day, it isn't that Apple was necessarily
           | better...their demand just didn't change and continued the
           | downward trend in certain product areas, giving them
           | breathing room.
        
             | gumby wrote:
             | It does look like apple's unit sales (of phones at least
             | which are the lion's share of product) have been declining
             | (conveniently they stopped reporting unit sales long ago)
             | but I don't think that really applies here. Apple's share
             | of the total semiconductor market is far from dominant.
             | 
             | What's really interesting is how well they couple demand to
             | shipment. One is that they appear to have low levels of
             | unsold inventory, both on the incoming (BOM) side and
             | output (unsold manufactured output, such as phones),
             | reflecting some incredible discipline. They also manage to
             | insure themselves against supply shock (because such a
             | tight tolerance for over purchase and overproduction makes
             | your supply chain more brittle) by making big moves in
             | their supply chain like financing their suppliers, doing
             | manufacturing R&D on their suppliers' technology and then
             | supplying that tech to the suppliers, taking big positions
             | in commodity markets (e.g. famously in DRAM a few years
             | ago) and other such things you can do when you have so much
             | cash on the balance sheet.
        
           | barkingcat wrote:
           | One thing to remember is that the current CEO Tim Cook
           | started in the supply chain management side of the company...
           | 
           | And did that job for Steve Jobs during the growth of the
           | iphone.
           | 
           | It would be expected that Apple would have extended insight
           | into supply chain and capacity, seeing as the head of the
           | company was/is the one who did that job.
        
             | commandar wrote:
             | I'm constantly surprised by how many people seem to forget
             | that Tim Cook got to where he is on the basis of being a
             | supply chain logistics whiz.
             | 
             | If there's _anything_ I expect Apple to excel at, almost
             | without question, under his leadership, it 's supply chain
             | management.
        
               | tommilukkarinen wrote:
               | The comment reminds me of Nokia end times. Everyone said
               | they mastered logistics.
        
               | commandar wrote:
               | I wasn't commenting on Apple as a whole; I'm actually not
               | a huge fan of the company overall under Cook's
               | leadership.
               | 
               | But supply chain management? They excel at that which
               | doesn't surprise me given who the CEO is.
        
             | gumby wrote:
             | It's also a strength on the demand _prediction_ side which
             | is typically done by marketing not the manufacturing side
             | of the business.
             | 
             | Yes, I know Cook came from Compaq for his supply chain
             | chops, but there are amazing supply chain folks elsewhere
             | in the industry. On this dimension Apple is in a class by
             | itself. Perhaps that fixation _does_ come from Cook, as
             | supply chain wizards typically don 't rise that high in the
             | corporate chain.
        
               | [deleted]
        
         | swalsh wrote:
         | I find it concerning how few companies exist to do this work. I
         | really hope Intel's new foundry business is successful.
        
           | BuckRogers wrote:
           | Their 20B investment into their Arizona campus has me
           | convinced. They're doing the right thing (if you live in the
           | US), my 5900X is pretty unreliable and I never had issues
           | with my Intel systems. The stars have aligned so I'm going to
           | buy their chips from here on out.
        
             | LouisContant wrote:
             | What issues have you been having with your 5900x? I've been
             | using mine without issue but for a short amount of time.
        
         | Kliment wrote:
         | Every single fabless semiconductor designer failed to predict
         | demand because their customers lied to them. The car industry
         | pulled a really dick move last year, and then pulled an even
         | more dick move in the opposite direction, and now everyone is
         | screwed. Back in early 2020 the car manufacturers decided that
         | demand for cars would go down, and because they have a
         | religious aversion to keeping any stock, cancelled lots of
         | orders with their vendors, screwing said vendors over. Their
         | vendors could not afford their fab slots because automotive is
         | such a big part of their revenue, so they cancelled their fab
         | slots. Those slots were happily sold on to entertainment and
         | computing customers, who anticipated a jump in demand due to
         | people staying home more. So far so normal.
         | 
         | However, the car industry got it badly wrong - people, afraid
         | of public transit, started buying _more_ cars rather than less.
         | The car industry, being screwed due to their just-in-time
         | religion of zero stock, was faced with their production lines
         | stopping so they called up all their vendors, and asked for
         | those orders back, and some more on top. The vendors then tried
         | to get their fab slots back, and were told to come back next
         | year. Some of them ended up buying other fabless IC designers
         | out of their slots, causing the problem to spread. Others
         | cancelled their existing orders to other customers, and
         | auctioned off their existing inventory to increasingly
         | desperate car manufacturers at a 6x to 8x premium. Anyone who
         | was not prepared to pay that or didn 't act fast enough was
         | screwed. From that point on, a bunch of companies that depend
         | on those lines of microcontrollers had to rapidly redesign
         | their product to use another device, taking even more devices
         | off the market with unplanned demand. The users of _those_
         | devices then had to move to others, causing even more
         | availability cascades. This is how two nasty moves by the car
         | industry caused global market disruption in a number of
         | industries that depend on electronics. This is not a normal
         | "demand has increased, and industry can't keep up" event, it's
         | elephants dancing and trampling everyone else underneath.
         | 
         | This is further aggravated by the top three automotive
         | semiconductor suppliers (NXP, Renesas, Infineon) having their
         | facilities destroyed in two unrelated disastrous events - a
         | fire at Renesas' wafer processing plant, and Texas freezing
         | over, destroying NXP's and Infineon's fabs through cleanroom
         | contamination and process interruption. Those events took out
         | months' worth of production, and destroyed product that had
         | already been sold before manufacture. This would have been
         | recoverable in a normal market, because distributor stock could
         | hold a couple months, but in this case it was game over for
         | non-automotive customers as all distributor stock was already
         | gone by then.
         | 
         | I see this in my work every day now - customers coming to me
         | for help with redesigning products to use a different
         | microcontroller, or help with sourcing parts from unusual
         | sources because their normal channels are gone. I've been in
         | this industry a long time and never seen anything like this
         | before. This is not a failure of supply chain analysis and
         | projection on the part of the fabless semicon vendors. This is
         | their biggest customers fucking their vendors over not once but
         | twice by lying to them about their own demand.
        
           | lacker wrote:
           | I think "lying" is pretty harsh. The pandemic caused many,
           | many people and companies to have trouble predicting future
           | demand. To me, it's a miracle that the American economy has
           | kept going as strong as it has. I know it's very important
           | for car manufacturers to predict future demand, and I know
           | it's an extreme frustration for many people whose logistics
           | are screwed up, but really, it shouldn't be a surprise that
           | the car manufacturers mispredicted the impact of a once-in-a-
           | lifetime pandemic.
        
           | ballenf wrote:
           | Maybe we need a futures market for fab slots. Then we could
           | just blame speculators for price swings instead of a
           | particular industry.
        
             | monkeydust wrote:
             | A futures market here could help investment in fabs.
             | 
             | Allow manufactures to hedge / lock in future value.
        
           | chrisseaton wrote:
           | > because they have a religious aversion to keeping any stock
           | 
           | In the US people _love_ to keep huge numbers of cars in
           | stock. Apparently most people buy from stock there, and
           | almost nobody does JIT, for some reason. So this isn't the
           | case everywhere.
        
             | 908B64B197 wrote:
             | Creates an interesting dynamic where the dealership has to
             | sell what's parked on it's lot right now.
        
             | monocasa wrote:
             | If you're talking about dealers, they're very different
             | from the manufacturers. Pretty much every car has someone
             | who's bought it already (whether that be an end consumer or
             | a dealer) by the time it rolls off the line.
        
             | rendang wrote:
             | I had taken parent poster to mean that car manufacturers
             | hate keeping large stocks of their component parts, not of
             | finished cars.
        
           | kyrra wrote:
           | Just in time delivery has its downfalls when vendors have
           | issues, but this is a known trade-off to that model. If a
           | company keeps inventory on hand, then they have the worry of
           | owning excess parts that they can never use and is a sink
           | cost later. So these companies can lose money with either, it
           | just depends on the circumstances that cause it.
           | 
           | I'd be interested to learn more about the order cancellation
           | you were saying that fabs were doing to non car
           | manufacturers. Shouldn't contracts prevent that sort of
           | behavior (without proper compensation)? And if they did that,
           | they are burning bridges that would make people less likely
           | to do business with them in the future. Maybe the car chip
           | business is enough money to warrant such moves, but seems
           | potentially sort sighted depending on exactly all what you
           | said happened.
        
             | bkor wrote:
             | > Shouldn't contracts prevent that sort of behavior
             | (without proper compensation)?
             | 
             | That depends on how big the customer/order is, no? If (as a
             | manufacturer) you could get away with not having it in a
             | contract, why include it?
             | 
             | Similarly, instead of actually cancelling they could also
             | "lie". Say that there are capacity issues, etc. That the
             | capacity issue is mostly because they resold the existing
             | manufacturing capacity, is left out.
             | 
             | > Just in time delivery
             | 
             | The well-known example of this is Toyota. Interestingly,
             | they've started ensuring they do have stocks. See e.g.
             | https://www.reuters.com/article/us-japan-fukushima-
             | anniversa.... I found that rather interesting.
        
               | ethbr0 wrote:
               | As with all things, an optimization (e.g. agile, JIT/lean
               | manufacturing) is predicated on certain assumptions. In
               | this instance, "we exist in an ecosystem where our
               | suppliers can rapidly respond to volatile demand from
               | us."
               | 
               | If the assumptions fail, then it's not a failure of the
               | optimization, but an incorrect _application_ of it. Maybe
               | we don 't currently live in a world in which elastic
               | semiconductor availability at scale can be assumed.
        
               | tehjoker wrote:
               | Nearly all industries have moved to Just-In-Time to
               | reduce costs, at the cost of making the entire economy
               | more fragile. We saw this highlighted in the pandemic as
               | suddenly there were no reserves of hospital capacity due
               | to JIT optimization.
        
               | to11mtm wrote:
               | Heck even consumer goods like toilet paper were impacted.
               | 
               | JIT is useful when the end-product has a high
               | depreciation rate and/or you forsee yourself frequently
               | changing the part out for a newer version.
               | 
               | Another tendril on the issue; modern accounting practices
               | tend to prefer JIT instead of the costs/overhead
               | mechanics of storing inventory.
        
               | lenkite wrote:
               | When I first studied about JIT in college, I asked my
               | professor: Doesn't this manufacturing methodology lack
               | fault-tolerance and isn't it deeply susceptible to
               | natural calamities or economic failures ? He replied that
               | it was proven, adaptable and reliable. Other suppliers
               | would come in if some suppliers failed.
               | 
               | JIT (aka lean manufacturing) today has now permeated
               | pretty much most of the global supply chain. Human
               | civilisation is far more fragile at the moment than in
               | the last few. hundred years.
        
               | ethbr0 wrote:
               | The true argument should have been that it's more
               | _efficient_ (for everyone involved). Which would have
               | invited the honest debate between the relative merits of
               | resilience vs efficiency.
        
             | MomoXenosaga wrote:
             | People forget why "just in time" was invented and why it
             | became a religion...
             | 
             | I do not fault companies for not planning for a worldwide
             | pandemic.
        
             | MangoCoffee wrote:
             | >fabs were doing to non car manufacturers
             | 
             | fabless design house sign wafer agreement with Fab like
             | TSMC. I'm guessing they didn't sign the agreement thus
             | cancel their slot.
        
           | baybal2 wrote:
           | The thing about a car is that BOMs are monstrously large.
           | 
           | If you have 1000 ICs in a car, and one of them is missing,
           | that's a $100,000 car you can't sell.
           | 
           | Car industry haphazardly buying out last stocks of ICs will
           | not help them work around that "one missing chip" problem,
           | and production lines are potentially stuck for many more
           | months.
           | 
           | The panic was undue, well, or best say of no use. The are
           | screwed, but its of no use for them to hope for some
           | desperate moves improving the situation now if they can't
           | assure 100% availability of _all, and every_ component on
           | their BOM.
           | 
           | I have few buddies who went to work on an ECU for
           | MTU/Siemens. They ran exactly into that when their companies
           | went for a complete redesign of their ECU to run on consumer
           | STM32. They had hopes of that such old 180nm-130nm CMOS chips
           | easily tolerating around 130Cdeg, they did tests, it worked
           | fine, and then they ran into undocumented high temperature
           | protection kicking in on a slightly newer chip revision, but
           | they already bough few millions of them, and other ICs for a
           | new design in inventories.
        
             | skybrian wrote:
             | Ouch.
             | 
             | It seems like the way to reduce risk would be
             | interchangeable parts from multiple suppliers?
        
             | Xorlev wrote:
             | And now STM32 are really tough to find for hobby
             | electronics when one used to find them everywhere, and
             | cheap.
        
               | swalsh wrote:
               | I was looking yesterday, the STM32 chip used in the
               | typically $5 blue pill now goes for $16 a piece.
        
               | JohnJamesRambo wrote:
               | What's a $5 blue pill?
        
               | techrat wrote:
               | Similar Microcontroller to others like the Teensy, Elite
               | C, Proton C, Pro Micro, etc...
               | 
               | All of which have been used in custom keyboard builds but
               | are capable of doing other things as well.
        
               | swalsh wrote:
               | It's a small development board (similar to Arduino but
               | based on the STM32F103C8T6) It's often blue so people
               | often call it the "blue pill"
        
             | rasz wrote:
             | >undocumented high temperature protection
             | 
             | sneaky market segmentation by STM?
        
               | sitkack wrote:
               | I doubt it. You want a part to shutdown if knows it is
               | going to fail, not pull everything high and cause the
               | device to catastrophically malfunction.
        
           | foobarian wrote:
           | Just wanted to say that I really appreciate your comment.
        
           | baq wrote:
           | if you wrote a book about it, i'd buy it.
        
           | speeder wrote:
           | Now I know why my business, that has nothing to do with
           | semiconductors are booming too.
           | 
           | I own a store that sells parts and tools to attach things to
           | each other (originally we sold nuts and bolts but those are
           | unprofitable without gigantic volumes).
           | 
           | In the last months suddenly we started to get an unusually
           | high amount of orders from factories intending to use our
           | products in manufacturing, while until then all we ever got
           | was orders for replacements parts and maintenance.
           | 
           | Since we are a store, not a manufacturer, our prices aren't
           | lowest as possible... so we are very confused about why
           | Toyota/Honda and others for example, called us wanting parts,
           | instead of calling our supplier, since we know they have
           | their contact anyway (I won't say who it was but for example
           | one time a manufacturer asked us if a product would help
           | them, and asked us to design something for their production
           | line... we did, then they ordered the product from our
           | supplier and never paid us anything for all "free"
           | engineering work we did for them).
           | 
           | So now I can guess what happened: car industry cancelled non-
           | semiconductor orders too, their slots got sold, and now they
           | want it back... so my store that tends to have higher stock
           | than others keep getting new clients willing to pay through
           | the nose to have parts because our own supplier doesn't have
           | them in stock and can't deliver any in short term...
        
           | ArtWomb wrote:
           | Top comment. Really appreciate this analysis. I think there
           | is a tangential question to be asked: are consumers really
           | demanding "software defined cars" in the first place?
           | 
           | 4 Forces Changing Automotive Electronics Systems
           | 
           | https://www.eetimes.com/4-forces-changing-automotive-
           | electro...
        
           | lotsofpulp wrote:
           | >However, the car industry got it badly wrong
           | 
           | You write at the beginning and end of your post that the car
           | industry lied to their vendors, but then you also write they
           | got it badly wrong, which means they were incorrect about
           | their projections of demand. Surely it can't be both, and it
           | sounds like the car industry did not lie, but simply were
           | wrong about their predictions for the future.
           | 
           | Or am I misunderstanding?
           | 
           | Nevertheless, thanks for providing context for the whole
           | situation.
        
             | Kliment wrote:
             | The car industry got their demand planning wrong, so they
             | lied to their vendors that they wouldn't need that
             | inventory. They then turned around and went "hey actually
             | screw that we want the inventory after all", making their
             | previous promise that they wouldn't buy it a lie.
        
               | shock-value wrote:
               | That's not what "lie" means.
        
               | lotsofpulp wrote:
               | I would not characterize that as a lie, which typically
               | involves an intent to deceive.
               | 
               | Rather, the only people with intent to deceive might be
               | the chip vendors. They either sold chip capacity that the
               | automakers still had the legal rights to, or they reneged
               | on sales to non automakers to resume supplying to
               | automakers.
        
         | lumost wrote:
         | There aren't many companies that can compete with 100 billion
         | dollar capex demands. While the loans are freely available, the
         | development risk remains. TSMC has a proven track record
         | pushing into the latest node - intel does not. Samsung has been
         | a little bit behind for a while while keeping pace.
         | 
         | Following this trend - 2nm will have something on the order of
         | 200 billion in capex outlays. Given that being first to market
         | has a premium, the loan will be high risk. If you borrow
         | thinking you'll be first and are late by 4 years then you and
         | your bank are going to have a problem.
        
           | eloff wrote:
           | On the bright side, the new processes will have a longer
           | life. When your 135nm process is replaced by 14nm within a
           | less than a decade, there's a huge gap there and the old
           | process isn't worth much. If you go from 14nm to 2nm, you can
           | still use 14nm for a lot of price sensitive customers.
        
             | oivey wrote:
             | The density increase is similar between those two jumps,
             | isn't it? Density significantly drives the price of chips
             | since you can use it to create more chips per wafer. Maybe
             | developing chips at 2 nm will be much more difficult due to
             | quantum effects?
        
               | packetlost wrote:
               | Before you start reaching quantum effects, you'll run
               | into crosstalk problems where electrons on 1 circuit path
               | can jump through the silicon substrate to other paths,
               | effectively causing a short. There is a limit to how much
               | you can do with silicon as your substrate simply because
               | of the size of the atoms.
        
               | oivey wrote:
               | That's quantum tunneling, right? That's one of the
               | quantum effects I was referencing.
        
             | buran77 wrote:
             | The law of diminishing returns. Shrinking brings lower and
             | lower benefits because the jumps may be hefty in relative
             | values (10% smaller) but in absolute values (nm) they don't
             | bring the same benefit as they did 15-20 years ago.
             | 
             | On the other hand, even in practical terms the older nodes
             | are more than adequate for most customers these days simply
             | because they are far closer to a modern node than the
             | equivalent would have been 20 years ago (for the reason
             | stated above).
        
         | alberth wrote:
         | > "the next 3 years, i.e 3nm in 2022 and 2nm in 2024"
         | 
         | I wish the industry would standardize on using "transistors per
         | square millimetre" as the metric for their node size instead of
         | "nm".
        
           | baybal2 wrote:
           | Even that is not exactly the same. Cells, or logic gates per
           | mmdeg is too rather ambiguous, as different implementations
           | of same logic families do things differently, and the metric
           | gets even wronger for different logic families.
           | 
           | The best I believe will be a whole cell library metric using
           | some lowest common denominator blocks like registers, adders,
           | bus pieces etc
        
             | addaon wrote:
             | Honestly, SRAM bits per square mm seems like a perfectly
             | fine metric for me. While I recognize that the memory-to-
             | logic density varies, sometimes significantly, between
             | processes, (a) SRAM cells are optimized to within an inch
             | of their lives ("within a nm of their lives"?), including
             | often being revised in minor process updates, so accurately
             | reflect the capabilities of the process; (b) many chips,
             | including the ones I personally tend to be interested in
             | (processors, etc) are SRAM-heavy, and get more so each
             | generation; (c) it's a single number with some connection
             | to reality, which is better than both a single number with
             | limited connection to reality ("process"), or a whole suite
             | of numbers that require deep interpretation (cell library
             | metrics).
        
               | baybal2 wrote:
               | And it is exactly because SRAM gets so intensely
               | optimised with each generation, I did not want to list
               | it. SRAM density, and performance is not characteristic
               | of how the rest of logic will perform no other logic
               | component get squeezed so much.
        
               | atq2119 wrote:
               | Ironically, it seems random logic may have been scaling
               | better than SRAM recently...
        
               | baybal2 wrote:
               | Because SRAM was already squeezed to the max generations
               | ago.
        
             | keanebean86 wrote:
             | I'm going to be that person and say it doesn't matter.
             | Either you're a consumer who really only cares about a
             | finished product's performance or you're a chip designer
             | who has the time and money to research past the nm number.
             | 
             | All us armchair semiconductor fabrication experts can have
             | a good old time arguing ove who's 2nm is better. The real
             | world will continuing doing it's thing.
             | 
             | *I know this is hacker news and some of you might be real
             | experts. I know nothing. Please don't feel disrespected.
        
               | variaga wrote:
               | You're basically right. Nobody doing actual chip design
               | cares about process nm numbers. Process selection done
               | right is a fairly tedious comparison of dynamic power
               | consumption, static power consumption, achievable
               | operating frequencies, wafer cost, SRAM density, IP
               | availability, process maturity/yeild, fab capacity/
               | availability and about a dozen other factors.
               | 
               | There will be a large-ish excel spreadsheet somewhere to
               | do the comparison.
               | 
               | The nm number is for press releases and non-technical
               | investors.
        
               | imtringued wrote:
               | It's basically a version number.
        
               | variaga wrote:
               | Yes, that's a good analogy, although the nm number by
               | itself isn't the full version e.g for 28nm alone, TSMC
               | had 28HP, 28HPL, 28HPM, 28HPC and 28HPC+ variants, of
               | which only HPM and HPC (but not HPC+!) are at all
               | compatible.
               | 
               | 28HPC+ and 28HP have very different performance, even if
               | they're both "28nm".
               | 
               | And if you really want to specify a process you also need
               | to know the metal stack ( _lots_ of options there), Vt
               | selection(s) (most processes have 2-5 options)  & high-
               | voltage device support option.
        
           | ebruchez wrote:
           | I found this article on the topic really informative:
           | 
           | https://read.nxtbook.com/ieee/spectrum/spectrum_na_august_20.
           | ..
        
       | mullingitover wrote:
       | This reminds me of a fun fact I learned many years ago, which is
       | that there's a corollary to Moores Law: the same growth curve
       | applies to the cost of building new fabs.
        
       | throwaway4good wrote:
       | From the article:
       | 
       | "However, Liu said that it is "economically unrealistic" for all
       | countries to "onshore" additional chip production, warning that
       | this could lead to more unprofitable capacity."
       | 
       | Well. The world is clearly not listening to that. So the question
       | is how the business of chip manufactoring will look in 2 or 3
       | years?
        
         | simonh wrote:
         | He may well be right, but concerns about supply chain security
         | might make it worthwhile for countries to subsidise capacity
         | that would not otherwise be economically viable.
        
           | throwaway4good wrote:
           | It makes sense for China to overinvest in national chip
           | manufactoring due to sanctions. However for the west, of
           | which Taiwan here is a part of, it is very risky. If the west
           | no longer supplies China's chip market, it would need
           | significant less chip manufactoring capacity.
        
             | cwhiz wrote:
             | If the west can't supply China, the west should ban Chinese
             | imports.
        
               | nindalf wrote:
               | You assume there would be malice involved. Even today
               | TSMC prioritises some customers (Apple) over others (car
               | manufacturers). In a future Taiwan that is a part of
               | China, TSMC might have a new pecking order where Huawei
               | is at the top and now Apple is chip constrained. You'd
               | ban all Chinese imports unless one Chinese company
               | rewrites it's contracts? Of course not.
        
               | cwhiz wrote:
               | With China there will unequivocally be malice.
        
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