[HN Gopher] TSMC sees chip shortage lasting into 2022
       ___________________________________________________________________
        
       TSMC sees chip shortage lasting into 2022
        
       Author : tosh
       Score  : 226 points
       Date   : 2021-04-15 16:35 UTC (6 hours ago)
        
 (HTM) web link (www.reuters.com)
 (TXT) w3m dump (www.reuters.com)
        
       | seiferteric wrote:
       | Damn, at this point I might just wait until zen 4 stuff comes out
       | before replacing my current desktop (circa 2012) since it still
       | seems fine for most stuff.
        
         | kelp wrote:
         | Ryzen 5 5600x and Ryzen 7 5800x prices / stock have about
         | equalized lately. So they are pretty easy to find at MSRP. You
         | can currently get a Ryzen 7 5800x from many major retails for
         | MSRP. The Ryzen 9 5900x and 5950x are harder to get.
         | 
         | It's GPUs that are nearly impossible to get right now. I've
         | been trying for weeks to get one for a friend. I'm intently
         | watching the stock notification Discords. There are frequent
         | restocks, but they seem to sell out in seconds.
        
       | throwastrike wrote:
       | I strongly believe this is going to allow Intel to make a
       | dramatic comeback. It will buy them enough time to catch up while
       | everyone is stuck buying Intel still as a result of supply
       | constraint.
        
         | cardy31 wrote:
         | Intel seems to be multiple years behind at this point. They
         | might make a bit of a comeback, but it would have to be a huge
         | process size shrink to be competitive. Based on their previous
         | years, I doubt that an extra year will help that much.
        
           | dannyw wrote:
           | Intel is shipping 10nm superfin (I'm typing this on a Tiger
           | Lake NUC). Density wise, this is comparable to TSMC 7nm (used
           | by AMD).
        
             | adrian_b wrote:
             | While Intel 10 nm SuperFin might be comparable in density
             | with TSMC 7 nm, it definitely is much worse for the yields
             | of chips with large area.
             | 
             | Six years ago, in 2015, Intel had no problems to introduce
             | the smaller Skylake U and the larger Skylake H at the same
             | time.
             | 
             | Now, Intel needs more than half of year to increase the
             | yields of 10 nm SuperFin enough to be able to introduce the
             | larger Tiger Lake H after the smaller Tiger Lake U
             | introduced last year.
             | 
             | This happens even if now the area difference between Tiger
             | Lake H and Tiger Lake U is not so great as in the previous
             | generations, because a good part of the twice larger CPU is
             | compensated by the 3 times smaller GPU.
             | 
             | On the other hand, the previous variant of the Intel 10 nm
             | process (non-SuperFin), which is still used for Ice Lake
             | Server, has much worse electrical properties than the TSMC
             | 7 nm, because at the same number of active cores and the
             | same power consumption AMD Epyc 7xx3 can have a clock
             | frequency up to 50% higher.
             | 
             | Moreover, the similar density of the Intel process means
             | absolutely nothing when the competition using the TSMC
             | process can deliver a more than 3 times greater L3 cache
             | memory at the same price and in the same package size.
             | 
             | The density does not have any importance if you cannot
             | deliver more transistors in a given package, because you
             | cannot manufacture large enough chips and because you have
             | been unable to predict that you will never be able to
             | manufacture large enough chips, so that you should have
             | designed from the beginning your product as multi-chip.
        
           | axaxs wrote:
           | Behind on...what? Against the latest and greatest Apple or
           | AMD? Maybe. I'd probably put it at a generation at most.
           | 
           | That aside, there's a -huge- market for chips that aren't the
           | latest and greatest. Intel expanding into that, which if I
           | read right is what they're doing, could be a huge moneymaker.
        
         | ajross wrote:
         | That seems unlikely, for the same reason that TSMC isn't able
         | to put Intel down permanently. We're reaching the end of
         | silicon scaling. Transistor densities might continue to rise
         | with 3D techniques, etc... but the actual logic is reaching
         | physical limits. So transistors per price and per power are
         | hitting walls.
         | 
         | TSMC pulled ahead, but they don't have a lot of runway to pull
         | _far_ ahead. Likewise Intel can catch up, but they can 't
         | retake the kind of lead they had a decade ago.
         | 
         | Semiconductors are turning into commodities, basically.
        
           | throwastrike wrote:
           | That's an interesting take. I feel the chip space is driven
           | by marketing a bit too much. At the data center level I don't
           | believe the performance difference is as dramatic in
           | practical terms. For the most part, you're not missing out
           | that much by going Intel unless you are working on something
           | time critical.
        
             | dvdkon wrote:
             | If we're talking AMD vs Intel, then the biggest difference
             | I see is cost (when the CPUs are in stock, anyway). Intel's
             | performance is fine, but the CPUs can cost multiple times
             | that of the competition. With Xeon, a small municipality
             | would never be able to say "You know what? Just go with the
             | 32-core CPU, it's not that much more."
        
               | chasil wrote:
               | I would prefer a 2-core CPU, when Oracle Enterprise
               | Databases run around $24k/core after discount, and SQL
               | Server Enterprise runs around $15k/core.
               | 
               | From single-core performance and low core count, Intel
               | appears to be the better choice.
        
           | doikor wrote:
           | > We're reaching the end of silicon scaling.
           | 
           | For the next 2 shrinks at least TSMC disagrees.
           | 
           | According to roadmap of TSMC they are roling out 3nm risk
           | production this year and they built a new research lab for
           | 2nm last year and already picked a site for the new 2nm fab
           | (Hsinchu, Taiwan). Beyond that I don't think anyone has any
           | real plans (yet).
        
             | tedunangst wrote:
             | I think the question is if anyone is going to refuse a 5nm
             | product because 3nm is available.
        
               | Miraste wrote:
               | Maybe not, but they might start refusing 14nm products.
        
           | codezero wrote:
           | A valuable and strategic commodity I'd add.
        
         | agloeregrets wrote:
         | Not really, the limits you see from TSMC here are for the
         | lesser of the important chip sales. Apple's orders that will
         | put a hurting on Intel in the market and mindshare are still
         | good. So Maybe Intel may sell more units in a small way by the
         | M1X will still hurt Intel's lead by just existing.
         | 
         | Did I mention that Intel Xe uses TSMC as well?
        
         | narrator wrote:
         | Intel has been trying to get their 5nm fab process right for
         | sometime now. So far, they have not been able to make it work.
         | This is not software. It's physics. It's chemistry. It's
         | material science. These are very hard problems to solve and
         | there's currently only one company that can do it and their
         | machines cost $200 million dollars and have a several year
         | backlog of orders.
        
           | mschuster91 wrote:
           | > there's currently only one company that can do it and their
           | machines cost $200 million dollars and have a several year
           | backlog of orders.
           | 
           | ASML has a market cap of 223 billion $, and their stock value
           | has doubled in a year. That's a _lot_ of growth...
        
         | freedomben wrote:
         | anecdotally two friends of mine wanted AMD but bought Intel
         | because of availability. You may be right.
        
           | throwastrike wrote:
           | I could get away with using my old 2013 Macbook Pro for 90%
           | of my computing needs. I could run the rest in the cloud.
           | Sure I have the latest AMD and I know the headline numbers
           | but I wouldn't be able to tell you that consumer chips
           | improved all that much in the past few years purely from a
           | practical pov.
        
             | totalZero wrote:
             | Same here, but that last 10% of computing needs can
             | complicate things.
             | 
             | Try running two 4k external monitors on a Haswell MBP.
             | 
             | They look about the same, but a Haswell MBP13 (Late 2013)
             | is very much less capable than an Ice Lake MBP13 (2020).
             | Not all of that difference is attributable to the CPU I
             | suppose, but the graphics and thermal throttling under load
             | certainly are.
        
               | KptMarchewa wrote:
               | Even 2019 i9 MBP can't do that without extreme
               | overheating and throttling, measured with pmset -g
               | thermlog.
        
           | ngngngng wrote:
           | That's just because no one wants Intel at the moment.
        
             | tedunangst wrote:
             | Intel still gets paid even if the people buying their CPUs
             | don't want them.
        
       | Black101 wrote:
       | that might help the global warming...
        
       | Thorentis wrote:
       | Imagine if we get to the point that critical medical or
       | infrastructure devices cannot be produced because all the chips
       | were taken up by Bitcoin miners wanting to speculate on a fake
       | currency bubble. Our own greed will be our destruction.
        
       | varispeed wrote:
       | I found that the chips for a project that I am working on are no
       | longer available and I got the lead time of 13 months, without
       | guarantee. It essentially means that I have to redesign the
       | project using different part which may take me few months and I
       | have no guarantee the other chip I choose will be available. The
       | problem is, however, that I can see those chips available in
       | their thousands on aliexpress and similar sites for 10x the
       | price. I also read on forums that Chinese entrepreneurs buy all
       | the chips and stockpile them. Is this some new kind of war?
        
         | thorwasdfasdf wrote:
         | according to one news outlet, I heard, the chinese have a long
         | history of double ordering chips. Now, the strategy final pays
         | off, as they can continue development. Most businesses don't
         | double order because of the additional costs, now they're
         | hurting more.
        
         | coliveira wrote:
         | > Is this some new kind of war?
         | 
         | No, this is called capitalism! Everyone should be proud.
        
           | Guthur wrote:
           | You show a distinct lack of understanding of what capitalism
           | is.
           | 
           | I can very easily hoard goods in a controlled centralised
           | economy as well, the only major downside is the governmnent
           | will likely throw me in some Gulag if they caught me.
           | 
           | It's actually market forces, nothing whatsoever to do with
           | capital.
        
             | KptMarchewa wrote:
             | One of the most common themes of propaganda in communist
             | Poland was how speculants are responsible for all
             | shortages.
        
           | scruffyherder wrote:
           | North Korea has all the chips you need comrade
        
         | tkinom wrote:
         | High tech version of "toilet paper hoarding"
        
           | swiley wrote:
           | The difference here is that people are used to not being able
           | to buy chips at costco/wallmart so you might have a chance at
           | selling your stock.
        
         | throwaway4good wrote:
         | Yeah. It is called the US-China tech war.
        
         | pojzon wrote:
         | Its not war, just a good way to make a lot of money now. You
         | buy cheap and sell absurdly high (10-20x the price). People
         | still buy because they have no other option.
        
         | pvarangot wrote:
         | Old-new stock and "unofficial" chips and parts has been a thing
         | for like ever. Now I hear of more "mainstream" projects having
         | to tap into that market but it has always been there.
        
         | temp667 wrote:
         | China def is stockpiling more chips I think. The Huawei
         | situation really brought home to china how the US or others
         | could basically try and cut them off and they are doing a lot
         | of things to reduce that potentially impact (all out on chip
         | mfg, chip orders etc) so having stock may be of benefit to them
         | in that environment.
        
           | baybal2 wrote:
           | Not stockpiling, a lot of people just do actual hoarding, and
           | speculation.
           | 
           | Buying out all stocks of some rare MCU which only has
           | probably few million units on the market at any given time at
           | $0.1 just to resell for a few dollars later is quite real
           | given the unprecedented squeeze.
           | 
           | How much would a car company pay for a rare, out of stock
           | chip which is the only thing missing in a car worth $100k?
           | 
           | There is murmur in Chinese BBSes frequented by industry
           | insiders about distributors intentionally either stuffing
           | their part stock counts, or diminish them to play the price.
        
             | Scoundreller wrote:
             | So Martin Shkreli, but instead of pharma, chips.
             | 
             | And designing products around perceived availability that
             | doesn't actually exist.
        
               | WrtCdEvrydy wrote:
               | Just-in-time manufacturing is pre-medidated on the idea
               | that whatever you need is available immediately for a
               | fair price.
               | 
               | I think we'll see some of this in the future where a
               | company's only purpose may be to hedge on bets on what
               | will be unavailable in the near future for "a fair price"
        
           | neonological wrote:
           | After China restricted other companies from entering their
           | own market then the only fair thing to do is to restrict
           | Chinas' access to other markets.
           | 
           | I'm not a trump supporter but he did the right thing on this
           | front.
        
             | echelon wrote:
             | It's a totally fair game.
             | 
             | > I'm not a trump supporter but he did the right thing on
             | this front.
             | 
             | It's a shame you have to admit that. I'm a liberal and
             | think we should be putting a hard squeeze on unilateral
             | trade. This policy makes sense for the US and other
             | countries regardless of your party.
             | 
             | You can see that the US is starting to ramp up hard core.
             | With international navies now sailing into the South China
             | sea and a deafening rise of anti-CCP news and (admittedly)
             | some propaganda, player two has finally entered the game.
             | 
             | I live near an air force base and over the last few weeks
             | have seen (and definitely heard!) an almost daily fighter
             | jet exercise. This hasn't happened in years.
             | 
             | China is going to be in a very tough spot soon.
        
               | neonological wrote:
               | >It's a shame you have to admit that. I'm a liberal and
               | think we should be putting a hard squeeze on unilateral
               | trade. This policy makes sense for the US and other
               | countries regardless of your party.
               | 
               | People like to join teams. So if I have an opinion that's
               | not part of the "team" or part of the "other" team then
               | people like to attack those opinions. That's why I make
               | sure I say something along the lines of "Hey, I'm not on
               | the other team, but I have a different opinion."
        
         | nickff wrote:
         | Those AliExpress chips may not be genuine. Buying from
         | unauthorized distributors has always been risky, and some
         | companies (especially Chinese ones) have been know to stamp
         | blank or generic parts with whatever part number you're looking
         | for. The really tricky vendors will put a few (10-50) genuine
         | parts at the beginning and end of a reel (to pass validation
         | testing), with defective or fake ones in between. Non-genuine
         | parts may also be lower-spec versions of what they are labelled
         | as (like a slower microcontroller or a higher offset op-amp).
        
           | Syonyk wrote:
           | For a fun set of reads on this ("Label the chips as what the
           | buyer wants regardless of what they actually are") from a
           | decade ago, Sparkfun got some "fake" ATMega 328p chips in
           | that, in fact, were nothing remotely resembling an ATMega
           | 328p.
           | 
           | In the words of someone after they'd puzzled out the puzzle,
           | "...so it looks like that die in the picture is pre-release
           | engineering material. Where the hell did you find that?"
           | 
           | https://www.sparkfun.com/news/350
           | 
           | https://www.sparkfun.com/news/364
           | 
           | https://www.sparkfun.com/news/384
           | 
           | https://www.sparkfun.com/news/395
        
             | Scoundreller wrote:
             | A proper scale should be able to detect weak effort fraud
             | like this.
        
               | Syonyk wrote:
               | A proper scale can detect all sorts of weak effort fraud.
               | 
               | Years back, I talked to someone who had done some
               | analysis on some of the "fake silver/gold" bars floating
               | around places (I think they were common on Silk Road for
               | a while?). Apparently some of the people faking metal
               | bars didn't actually bother learning what a "Troy Ounce"
               | was.
               | 
               | There was a "10 oz" bar that was 10 ounces - 283.5 grams.
               | Except, in metals, "oz" means Troy Ounce - so it should
               | have been 311 grams. You could literally feel that it was
               | light if you were used to dealing with metals.
        
               | dan-robertson wrote:
               | I suspect it wasn't really trying to defraud people who
               | know what a Troy Ounce is. I'd find it believable if
               | people thought fake bars at 311g were frauds for not
               | weighing 10oz.
        
             | routerl wrote:
             | This was a great read, thanks!
        
             | jandrese wrote:
             | I'm guessing it's a sample run and the company realized
             | there was a bug in the silicon and told the fab to destroy
             | the rest of the samples. Instead someone at the fab set
             | them aside for the future when they need some raw material
             | to scam people with.
             | 
             | I find it strange that whoever decided to do this kept the
             | correct datecode on the packaging. Presumably they didn't
             | label them as ATMega 328s until the order came in, it would
             | have been trivial to change the datecode to something
             | reasonable for that chip.
        
           | swiley wrote:
           | This is why buying chips off amazon isn't always a great
           | idea.
        
         | La1n wrote:
         | >entrepreneurs buy all the chips and stockpile them. Is this
         | some new kind of war?
         | 
         | No, that's capitalism.
        
           | [deleted]
        
         | foobarian wrote:
         | Heh. Let me tell you about how I tried to buy a new Nvidia RTX
         | 3090...
        
       | polskibus wrote:
       | Why doesn't TSMC just raise prices 100% or so ? Surely everyone
       | would just have to pay up?
        
         | ChuckNorris89 wrote:
         | Semi orders are made years in advance with pricing fixed in the
         | contract.
        
       | birktj wrote:
       | Question: does the chip shortage only apply to the smallest
       | process sizes? That is what I would assume, but with the talk
       | about problems for car manufactures having supply issues it would
       | seem the shortage extends to larger process sizes as well? (Do
       | they really need the newest snapdragon processor in a modern
       | car?)
        
         | Scoundreller wrote:
         | I wonder if auto has been moving to smaller processes just for
         | better efficiency.
        
         | blihp wrote:
         | It's across the board. Makers of small scale microcontroller
         | projects/kits (whose chips typically use 28nm and larger
         | process nodes) are reporting problems getting parts. Apparently
         | some of the parts the autos need are >100nm.
         | 
         | I suspect that this problem started with the Huwai sanctions
         | causing lots of Chinese companies to start panic buying
         | inventory not knowing of they're going to be the next hit with
         | sanctions. Add to that the demand shifts caused by the
         | pandemic. Then throw in other companies realizing how
         | vulnerable they are (and therefore trying to add to their own
         | inventories) and some speculators and it makes for a real mess.
        
         | mmoskal wrote:
         | COVID induced demands for consumer electronics, while
         | constraining supply of ICs. There's lots of low-end chips (not
         | the CPU or GPU, but say power controllers, etc) going into
         | laptops and peripherals (mice, keyboard, etc.).
         | 
         | Hence the squeeze all around.
         | 
         | On top some distributors are selling whatever they have left at
         | whatever market is willing to pay, which may mean 100x the
         | usual price...
        
         | high_priest wrote:
         | Looking at the amount of driver assists and video analysis
         | solutions packed onto modern cars, maybe?
        
         | agloeregrets wrote:
         | Other way around. Small process sizes have already been called
         | for a long time ago so no changes were made in the demand. For
         | example, TSMC's 5nm process was bought out by Apple two years
         | ago. It's the more JIT processes with shorter order lead that
         | have impacts.
         | 
         | Apple will be able to get things like the M1X with no problem
         | but they will have trouble getting things like microprocessors
         | used for power management.
        
         | baybal2 wrote:
         | No, it's actually much worse for legacy processes, discretes,
         | and some components.
         | 
         | It's stuff that was usually made on non-300mm fabs, and 130nm+
         | nodes.
        
         | stefan_ wrote:
         | Everything is short in supply. Part of that is because analog
         | chips generally use older processes anyway and part of it is
         | that old fabs have a very long tail of selling older process
         | size chips. I think right now the best bang for your buck is
         | 40nm.
        
       | coliveira wrote:
       | This is the result of something called just-in-time
       | manufacturing. The geniuses who created this method of
       | manufacturing always thought that there would be no interruption
       | of supply chains, and that we could forever produce only what we
       | could consume at the moment.
        
         | dyingkneepad wrote:
         | I feel like this comment is kinda like blaming the inventors of
         | the Knife for the people who were stabbed. JIT was an amazing
         | invention and a progress to mankind.
        
         | digikata wrote:
         | Toyota was one of the creators of Just in Time manufacturing,
         | and they planned for this particular supply chain interruption.
         | 
         | https://jalopnik.com/toyota-prepared-for-the-chip-shortage-y...
        
           | a9h74j wrote:
           | Kanban is not incompatible with queuing theory.
        
         | reader_mode wrote:
         | Reminds me of a joke - if economist designed humans instead of
         | having two kidneys we would share one between five people.
        
           | scruffyherder wrote:
           | And I can make a baby in 1 month with 10 women.
        
       | KingMachiavelli wrote:
       | If you look at the numbers 50% of TSMC's revenue is made up by
       | the 5nm and 7nm as of 2021. And just one company, Apple, makes up
       | 25% of TSMC's revenue. While the M1 is a great chip - it also
       | just launched and Apple has been one fourth of TSMC's revenue for
       | years. This means that around 40 to 50% of the top performance
       | nodes suitable for general purpose use in data centers,
       | workstations, etc. is being used for mobile devices -> mostly
       | phones and tablets.
       | 
       | On one hand I have to thank Apple for pushing semiconducter
       | development and making ARM a real x86 replacement outside the DC.
       | However, it seems really wasteful and like a mis-allocation of
       | resources to put the top performing silicon in devices that don't
       | really need it. Even the M1 architecture is handicapped by Apple
       | itself. Besides the most obnoxious use of M1 Mac mini's in DC
       | basically for the sole purpose of iOS and macOS app development,
       | the CPUs are mostly used in consumer devices. Their main purpose
       | for use in consumer devices? To eliminate the need for a fan and
       | to improve battery life. Both of these things are great but also
       | just not high on the list of problems humanity needs to solve.
       | 
       | What I am trying to say is that, for the last few decades, it at
       | least seemed like 'real' work drove semiconductor development.
       | From cloud giants to a local companies data center, performance
       | and power efficiency were what drove and purchased the bleeding
       | edge CPU/GPUs (I suppose in some ways GPUs were driven by
       | consumers/entertainment reasons). Now it seems like luxury
       | products are taking on that role.
       | 
       | I call these mobile iOS/Android products luxury products because
       | outside of novelty purposes no one is really producing movies or
       | something of value beyond a word document on these devices.
       | Traditional laptops and desktops "won" in a way for the same
       | reason that the M1 processor exists; mobile operating systems
       | still have never matured to replace then so instead even Apple is
       | bringing mobile software _back_ to the traditional computer.
       | 
       | The most worrying aspect of this development of course is how
       | locked down most of these devices are. iOS devices are of course
       | in a walled garden and even macOS has more & more restrictions. I
       | can easily imagine a day where consumer level electronics are
       | completely locked down and the only way to get a open/free
       | platform is to buy server hardware - if that is even possible.
       | Server hardware is also moving to ARM and while not locked down
       | in a software or hardware way it is locked down in the sense that
       | only a few companies can buy it or at least no one so far is
       | interested in selling single digit volumes of ARM servers. The
       | days of open computing for the general person certainly seem
       | numbered.
        
         | zxcero wrote:
         | > However, it seems really wasteful and like a mis-allocation
         | of resources to put the top performing silicon in devices that
         | don't really need it
         | 
         | Semiconductor research requires a lot of capital. If Apple is
         | providing that upfront capital at a higher rate, then that's
         | great for TMSC. More capital for spearheading development. And
         | with better and better yield at smaller node sizes, it'll
         | trinkle down. 2 years later 5nm would become common place and
         | can be used to produce chips for servers. It's just the
         | question between now and a couple years later.
         | 
         | > Both of these things are great but also just not high on the
         | list of problems humanity needs to solve.
         | 
         | At the end of the day, it's the market that determines
         | innovation and R&D. More money for a specific product results
         | in more money spent in researching and development. It's about
         | what people need rather it's about what people want. Also not
         | having a fan and improved battery life means less ewaste,
         | smaller batteries and less electricity use.
         | 
         | > What I am trying to say is that, for the last few decades, it
         | at least seemed like 'real' work drove semiconductor
         | development.
         | 
         | First it was military spending that funded CPU development.
         | Later on, it was enterprise because of companies had money. Now
         | with cheaper and faster hardware, more and more people are able
         | to get their hands on a PC. You can watch educational videos
         | online. Talk to thousands of people or connect with relatives.
         | You can do online webinars or shows. Heck, you can even learn
         | languages on apps on your phone. In the end, mobile phones are
         | a tool. They can be beneficial or detrimental on the use.
         | 
         | > mobile operating systems still have never matured to replace
         | then so instead even Apple is bringing mobile software back to
         | the traditional computer.
         | 
         | It's about centralizing software development between platforms.
         | It's cheaper and easier to develop one software OS across
         | platforms than to have MacOS and iOS separate. This might mean
         | that later on your Ipad can run VScode.
         | 
         | > I can easily imagine a day where consumer level electronics
         | are completely locked down and the only way to get a open/free
         | platform is to buy server hardware - if that is even possible.
         | 
         | Its the opposite. The prices for all these microprocessors have
         | been getting lower and lower while becoming exceeding more
         | powerful. You can buy an integrated microcontroller with
         | bluetooth and wifi modules for <$10. In fact, open computing
         | has expanded due to cheaper cost to PCs and faster hardware.
         | More people can afford to do software and hardware development.
         | There's so many resources nowadays for open source development
         | or even hobbyist tinkering of hardware. This is one of the best
         | times you can be in for open computing.
        
       | throwaway4good wrote:
       | I thought this article about purchases of chip manufacturing
       | equipment was very interesting:
       | 
       | https://www.scmp.com/tech/tech-trends/article/3129611/us-chi...
       | 
       | US-China tech war: China becomes world's top semiconductor
       | equipment market as Beijing pushes local chip industry
       | 
       | Mainland China topping the list for the first time ever. South
       | Korea is investing a lot more than usual. Taiwan is stable. The
       | US is down.
       | 
       | Will be very interesting how the chip situation will look on the
       | other side of the current shortage. The shortage is all over, not
       | just for high end processes. The high end processes will probably
       | still be done by SK, Taiwan and the US but a lot of the lower end
       | will go to China.
        
         | baybal2 wrote:
         | If anybody been watching the second hand semi equipment market,
         | all kinds of opportunistic players from China been scouring the
         | market clean for last 5 years.
         | 
         | One of those opportunistic players hoping on becoming a n-th
         | tier fab player is for example Galanz -- a kitchenware company:
         | https://twitter.com/ogawa_tter/status/1310852850033946624
         | 
         | Though, there is notion that those are just manoeuvres to get
         | giant tax subsidies from the state. Semiconductor companies in
         | China pay near no tax, even if they have 1 wafer per month
         | fabs.
        
           | throwaway4good wrote:
           | Well. Nokia started with rubber boots.
        
             | jamiek88 wrote:
             | Nintendo playing cards!
        
             | sudosysgen wrote:
             | Their rubber venture is still alive and well and makes good
             | studded winter tires for bicycles
        
       | Black101 wrote:
       | https://arstechnica.com/gadgets/2021/04/intel-nvidia-tsmc-ex...
        
       | ArkanExplorer wrote:
       | How much fab capacity is indirectly dedicated towards Crypto
       | mining?
       | 
       | Could blocking the fiat inroads, and causing a price fall, be a
       | solution to this chip shortage?
        
         | jagger27 wrote:
         | It's direct competition. Nvidia sells normal graphics card
         | chips directly to miners.
        
         | PhantomGremlin wrote:
         | That's an interesting question. Crypto mining wants to do more
         | and more cycles, faster and faster, so of course they need
         | chips from the newest processes.
         | 
         | But in reality I don't think "blocking" is possible now. That
         | ship has sailed (feel free to use your own cliche here). There
         | are now exchange listed companies, eg Coinbase, that deal in
         | crypto. There are mutual funds that deal in crypto. Tesla owns
         | a bunch of crypto :)
         | 
         | A lot of older ICs, eg automotive, don't need leading edge
         | fabs, and those other fabs also are seeing record demand.
        
           | ArkanExplorer wrote:
           | But what does eg. Germany, Korea, Japan have to gain from
           | Crypto activity?
           | 
           | What does humanity have to gain generally, with an increasing
           | share of our energy and chip manufacturing output going
           | towards an essentially pointless activity?
           | 
           | Why not more individual action, like India has taken?
           | 
           | Much of the wealth seems to be funneled into the USA, where
           | many of the earliest entrants and major Crypto traders are
           | located.
        
             | kelp wrote:
             | It seems to be a net negative to society to me. One of
             | those cases where a small group gets rich, while everyone
             | else pays the externalities.
        
         | baybal2 wrote:
         | Miners buy at cost parity with coin costs.
         | 
         | Even at the current ridiculous price of crypto, they can't
         | afford latest nodes. And TSMC make them pay cash because they
         | were previously burned by few mining chip makers going bust
         | after their bet on coin prices didn't pay put.
         | 
         | But only underlines how chipmaking is the next most lucrative
         | thing after, effectively, printing money.
        
         | throwaway4good wrote:
         | TSMC lumps crypto into their HPC segment which is rising. How
         | much of it is crypto is unclear. Bitmain manufactures their
         | mining equipment on the latest TSMC process.
        
       | xwdv wrote:
       | What if chip shortage just became the new normal? Any
       | alternatives?
        
         | CoastalCoder wrote:
         | That's a fantastic question! Here's my hot take:
         | 
         | - Price increases on all products that require chips.
         | 
         | - Right-to-repair laws make some headway, as the cost of repair
         | becomes more competitive with the cost of replacement.
         | 
         | - Commercial software developers shift their focus a little
         | more towards program efficiency, at the cost of slower feature
         | development and/or higher code complexity.
        
         | BlueTemplar wrote:
         | Kind of : http://collapseos.org/
        
       | j_walter wrote:
       | https://wccftech.com/tsmc-plant-hit-by-power-outage-millions...
       | 
       | This certainly won't help. Just like the weeks that Samsung's
       | fabs were down in Texas after the storms in February...it doesn't
       | take much to disrupt a facility for weeks.
        
       | simonh wrote:
       | So this seems to be about increased demand for high end
       | components driven by increased IT equipment purchases during the
       | lockdown as people depend on this stuff more. That's the
       | implication from the article.
       | 
       | Meanwhile I'm also reading about chip shortages affecting car
       | manufacturers, and possibly some other industries. The dynamic
       | there seems to be that car makers (and possibly others) cut
       | orders drastically early in the lockdown, which means component
       | makers shut down manufacturing capacity and it's taking a long
       | time to ramp it up and also clear the backlog of orders as demand
       | came back earlier than expected.
       | 
       | So this seems to be two completely different effects going on. I
       | know very little about these industries, but I wouldn't be
       | surprised if there's a meeting of these effects in the middle.
       | High end devices often have some lower end components (peripheral
       | and glue logic on desktop motherboards for example) in addition
       | to the potentially pricier main CPU.
       | 
       | Is that the story?
        
         | ksec wrote:
         | So to _over simplify_.
         | 
         | 1. Car Manufactures canceled their order (X) for 6 months.
         | 
         | 2. Fab sold those capacity to others
         | 
         | 3. Demand for All electronics increases because of WFH ( and
         | possibly bitcoin )
         | 
         | 4. Demand for Car actually _raised_ during COVID.
         | 
         | 5. Now Car Manufacture want X, their original order, another X
         | for their next 6 months, as well as 0.5X where 0.5 was the
         | increase in demand. So total 2.5X
         | 
         | 2.5X increase in order to catch up with their production All
         | while other electronics such as iPhone 5G, Tablet, PC are
         | selling record number in recent years.
         | 
         | It also doesn't help when Samsung's yield are failing yet
         | _again_
         | 
         | Now let's take this even further. Apple is predicted to sell
         | record number of iPhone, Mac, and iPad. TSMC will do
         | preferential treatment to all orders relating to Apple with
         | Apple courting their suppliers. So that uses up those bigger
         | nodes as well. You end up having industry fighting for whatever
         | that is left.
         | 
         | And just like any product or commodities, you have people
         | hoarding them for profits. It is the same with PS5, Switch,
         | Graphics Card or any other with limited quantities and high
         | demand. This will attract interest to trade them and make
         | money. Which add even more strain to supply chain.
         | 
         | From a Supplier perspective, all of a sudden you are looking at
         | a market with seemingly _unlimited_ demand and you have limited
         | supply. This scenario is similar to what happened with DRAM and
         | NAND in 2015 - 2019. Although the cause is different.
        
           | cogman10 wrote:
           | A couple of other things that happened.
           | 
           | Intel has been struggling to shrink their dies, so they went
           | to TSMC for some of their chip production.
           | 
           | Apple ditched intel with their latest macbooks (with the M1),
           | which also requires more TSMC capacity.
        
             | skohan wrote:
             | From what I understand, Intel's announcement that they
             | would use TSMC was basically hot air. TSMC's capacity was
             | already tapped, and they have little incentive to use it
             | for a competitor when it's been planned for other customers
             | since years back.
        
               | officeplant wrote:
               | IIRC, Intel only planned on using TSMC to produce some of
               | their low cost celeron chips.
        
               | girvo wrote:
               | Aren't they using them for their upcoming dGPU
               | production?)
               | 
               | https://www.techpowerup.com/277134/intel-xe-hpg-to-be-
               | built-...
        
             | Guthur wrote:
             | Not to mention AMD moved from mostly using Globalfoundries
             | to using TSMC for most of their new CPU/GPU including
             | consoles. And AMD have had quite the resurgence over the
             | last 5 years in terms of sales.
             | 
             | It's definitely a confluence of demand scenarios which
             | would have been difficult to plan for at the best of times
             | and then there was the overall disruption to supply chains
             | and long term planning that Covid would have presented.
        
           | jaflo wrote:
           | I am not really familiar with the industry, why will TSMC
           | give preferential treatment to Apple orders?
        
           | KptMarchewa wrote:
           | Who were those others in point 2)? That's the question.
           | 
           | Either they would want the capacity either way, or it's some
           | kind of customer induced by temporarily reduced prices, so
           | price sensitive.
        
           | PragmaticPulp wrote:
           | I think the focus on automotive manufacturers has been
           | exaggerated. Automotive orders are definitely a contributing
           | factor, but the popular narrative is putting too much
           | emphasis on a single industry.
           | 
           | The reality is, like you said, demand for consumer devices
           | across the board has spiked. Not just cars, but phones and
           | video game consoles and everything else. Cars are a part of
           | it, but I don't see how we would have avoided a chip shortage
           | if auto makers hadn't cancelled some previous orders and then
           | resubmitted them.
        
         | vkou wrote:
         | Component makers did not shut down manufacturing capacity, they
         | just re-allocated the timeshares formerly set aside for car
         | manufacturers to other customers.
         | 
         | Notice that there's no shortages of Intel CPUs, and few serious
         | shortages of console gaming systems. That's where the
         | manufacturing capacity went.
        
         | doikor wrote:
         | > component makers shut down manufacturing capacity and it's
         | taking a long time to ramp it up
         | 
         | Not really. The component manufacturers canceled their fab time
         | contracts with fab companies as they could not afford to hold
         | onto them if their customer (the car manufacturers) were not
         | buying from them. And once they did that fabs just sold the
         | capacity to the next buyer.
         | 
         | So now the component manufacturers only option is to buyout the
         | contract from someone else (really really expensive with
         | current available capacity) or just wait until the contracts
         | expire to get a chance to bid for them again. Also as fab time
         | is auctioned if the shortage still continues then the fab time
         | will be really expensive even then.
        
       | jhgb wrote:
       | I consider myself lucky to have upgraded a few months ago. Now I
       | might not have to worry for two or three years.
        
       | RicoElectrico wrote:
       | Yeah, consolidate more [1]. What could possibly go wrong.
       | 
       | https://en.wikichip.org/wiki/technology_node#Leading_edge_tr...
        
         | ip26 wrote:
         | As far as I know, these were not consolidation so much as
         | trailing players dropping out of the race in a winner-take-all
         | market.
        
         | jagger27 wrote:
         | I only hope in the next decade or so that fab tech becomes more
         | commoditized so GlobalFoundries and co can get back onto the
         | leading edge node.
        
         | mlinksva wrote:
         | Interesting chart. For someone who doesn't follow the industry,
         | does it show current capability, or capability at the time a
         | given node was cutting edge? If the latter it really does show
         | a tremendous winnowing. To what extent is that winnowing
         | attributable to consolidation (M&A) vs dropping out?
        
         | taurath wrote:
         | Maybe one of the ultra billionaires could make a competitor,
         | but the amount of expertise built up over time in those
         | companies seems insurmountable. Possible maybe, but quite a
         | tall order, people would rather just build a space company it's
         | easier
        
         | KptMarchewa wrote:
         | Development costs of each generation rises exponentially. Would
         | not be surprised if that number dropped even more around 3-2nm
         | nodes.
        
       | [deleted]
        
       | fest wrote:
       | TI DC-DC switcher IC in one of my designs cost about 0.7EUR
       | before this. For current production batch we had to buy it for
       | around 22EUR (qty 100).
        
       | cm2187 wrote:
       | On that topic has anyone seen any EPYC Milan CPU available
       | anywhere? They were supposed to have been released last month but
       | are nowhere to be seen.
        
       | bogwog wrote:
       | That link points to an "article" (it's like 3 sentences long)
       | with the title
       | 
       | > TSMC's Q1 profit up 19%, beats market estimates
       | 
       | And says nothing about a chip shortage
        
       | KingOfCoders wrote:
       | Wasn't able to get a new dishwasher because of "no chips".
        
       | egeozcan wrote:
       | Does anyone else also feel like we're in a factorio game and
       | someone realized we're not producing enough green chips after
       | all?
        
         | antisthenes wrote:
         | I think it's more the case of getting to 7nm Blue Chips and
         | realizing how much more costly they are in terms of
         | prerequisite requirements.
        
         | CivBase wrote:
         | I know, I know! But I didn't make the bus wide enough for all
         | the iron plates and copper plates I'd need to increase green
         | circuit capacity. I could upgrade to blue transport belts, but
         | that will take _forever!!!_
         | 
         | How could past me have ever been foolish enough to believe I'd
         | never need more than 20 lanes on the main bus? I was so _stupid
         | stupid stupid!_
         | 
         | Woah. Sorry. I blacked out for a minute there. What were we
         | talking about?
        
         | skykooler wrote:
         | And the GPU shortage is because all our red circuit production
         | is going to the miners.
        
         | PartiallyTyped wrote:
         | Speaking of, this is a blog post that I really liked on
         | factorio from a functional programming perspective.
         | 
         | https://bartoszmilewski.com/2021/02/16/functorio/
        
         | MivLives wrote:
         | If only the real world worked in Factorio timescales.
        
           | gnulinux wrote:
           | I'd like to carry thousands of chip factories in my pocket
           | and create gigafactories using robots in a matter of days
           | (in-game days).
        
         | _JamesA_ wrote:
         | Or M.U.L.E. for us old timers.
        
         | grenoire wrote:
         | I hope that doesn't mean that I have to build a rail line to a
         | new copper sector to the north-east...
        
           | BlueTemplar wrote:
           | No, but you might have to "liberate" some oil fields in the
           | mid-east...
        
         | Groxx wrote:
         | We put all our green chips in a mega-factory or two, and used
         | trains to move them to the major places that needed them.
         | 
         | Unfortunately it's a multiplayer server, and someone started
         | rerouting the trains because they wanted to build more cars.
        
       | ericwood wrote:
       | I'm a bit confused; the linked article talks about TSMC's profits
       | and makes no mention of the chip shortage or any predictions
       | related to it. Am I missing something?
        
         | tosh wrote:
         | looks like Reuters changed the content:
         | 
         | https://www.reuters.com/world/china/tsmcs-q1-profit-rises-19...
        
         | justinzollars wrote:
         | I think the article was updated
        
       | PhantomGremlin wrote:
       | Real Men Have Fabs.
       | 
       | The above quip came from TJ Rodgers of AMD/Cypress. It was
       | popularized by Jerry Sanders, CEO of AMD.[1]
       | 
       | There were many fabs back in the day. Now they're mostly EPA
       | Superfund sites in Silicon Valley.
       | 
       | The IC industry has done thru many many boom/bust cycles. This
       | cycle could be one of the worst because fabs are so expensive
       | that everyone has chosen to simply buy their chips from the few
       | remaining "real men" who still have fabs.
       | 
       | Not entirely unforeseen.
       | 
       | [1] https://semiwiki.com/john-east/273760-real-men-have-fabs-
       | jer...
        
         | sand500 wrote:
         | Bigger and bigger risk to build state of the art fabs if
         | TSMC/Samsung are just going to beat you anyways
         | 
         | https://en.wikipedia.org/wiki/Moore%27s_second_law
        
           | Skunkleton wrote:
           | Bigger and bigger risk for the likes of Apple and AMD
           | depending so totally on TSMC. I don't see how this dependency
           | benefits them in the long run.
        
             | bluescrn wrote:
             | Apple seems strangely unaffected by the chip shortage, with
             | a seemingly-plentiful supply of new iPhones, iPads, and M1
             | Macs.
        
             | agloeregrets wrote:
             | Apple is less harmed than AMD. TSMC basicly is Apple
             | Taiwan, without Apple as a customer paying for R&D and
             | providing custom 5nm designs to build and push R&D, TSMC
             | has no business. Apple is an ensured sale with very long
             | term contracts in place (> 5 years). By time any contract
             | expires, Intel will have caught up.
        
       | e9 wrote:
       | On the bright side, this might encourage reuse of used/old parts
       | and care about being more efficient with what we currently have,
       | which is a form of innovation on its own
        
       | christiansakai wrote:
       | RIP all gamers everywhere.
        
         | dyingkneepad wrote:
         | And the gaming industry that may be holding off their PS5
         | releases.
        
         | [deleted]
        
       | libeclipse wrote:
       | That is not what the article says. Did anyone open it?
        
       | Yoofie wrote:
       | Shocking to absolutely no one. When you are the only game in town
       | and everyone wants the latest greatest (high demand), shortages
       | are going to last into the foreseeable future[1].
       | 
       | [1] - Foreseeable future = multiple years on end
        
         | dannyw wrote:
         | Samsung is shipping 5nm too, it's not as good as tsmc 5nm but
         | it is close.
        
           | Black101 wrote:
           | 2 sources is not much better then 1 ... we have seen 3 and 4
           | sources collude in the past
        
       | InitialLastName wrote:
       | This article doesn't say what is in the title. This might be
       | better:
       | 
       | https://www.theverge.com/2021/4/15/22385240/tsmc-chip-shorta...
       | 
       | To that point, this issue is already painful for anyone making
       | electronics, and is going to hurt the small electronics
       | manufacturers more (if you aren't in a position to buy a million
       | parts, good luck getting any priority as things come back on
       | line).
        
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       (page generated 2021-04-15 23:00 UTC)