You are spot on. But is is only less profitable in the short run, right?
And what about the alternative? What does the longer run hold for us if we choose to hide like little children? It ain't pretty.
U.S. sanctions will not halt rise of China's chip industry
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And what about the alternative? What does the longer run hold for us if we choose to hide like little children? It ain't pretty.
An electronic engineering company that I worked for many years ago (back in the 80's, and it no longer exists) sold a product to one of the Arab countries. After a while the customer needed an electronic board that was used in one of the systems. We sold them the board and they returned it because one of the power transistors had RCA printed on the top of it, (along with the transistors part number). And that country had a ban on anything from RCA being imported to it. When we got the board back, the shop used an ink pen eraser to rub away the RCA letters from the top of that power transistor, and recoated the board with clear Krylon paint, (you could see the scratches where the RCA letters had been removed, even after it was again sprayed, if you knew where to look), I then retested it, and it was shipped back to them.
Moral of the story, just because a chip or transistor is banned from being imported from a certain country, does not guarantee that some of those items will never get through such an embargo.
Another true story about shipping electronics to a customer in another country. One of the engineers had to take a trip to China to be there when some computers we sold them were used for the first time (they were to be use to control that huge dam, and we had had people from China over here for about a month for training). And also, at the same time a customer in an African country/nation needed an electronic board for a system they had previously bought from our company here in the US. They wanted that board in a big hurry (it was for a mining project and without that system working they were losing money big time for every hour that it was down), so it was decided that the traveling engineer would divert on his trip to deliver it in person. However, the paperwork required before such a board could be shipped to them would take weeks or even months to process. Our company called them up and told them of this problem, and they said to wrap the board in a bath towel along with a hundred-dollar bill and put that in the engineer's luggage, and to add a hundred dollars to the price of the board. That was done, and when the engineer arrived in that country the hundred-dollar bill was gone, and the board was still in the towel.
Moral of the story, --- same as above ---.
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As a "market" the alternative is to look for the next big thing and let the others build the cheap low end stuff.
For example: audio chips, low end network chips, mouse, keyboard, cables, USB stuff, power circuits, etc are mostly done at lower cost area like Taiwan these days, just go look at your "Device Manager" in windows and see how many RealTek / MediaTek stuff out there and what happened to companies like 3COM.
If everyone has to build their own fabs companies like Qualcomm and nVidia would never exist, they would just be the 3COM, 3dfx, and the bad days of AMD.
Sometimes you have to buy stuff from "questionable" vendors so you can focus on building the best thing on top of it. Soviet tried to build everything for "military" reason and they got themselves into financial collapse. We are capitalist and we should pick our battle no matter what we do, that's just how I think at least on civilian stuff.
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Way I see it, we can figure out how to build things here - subsidize them if we have to - or we can subsidize the entire world by continuing to patrol all the trade routes with our navy.
Compare the math and some subsides to build fab plants here sounds like a good deal.
Sure, might take a while, but Taiwan is our friend and needs us more than we need them really, so I presume they will help in the end.
Compare the math and some subsides to build fab plants here sounds like a good deal.
Sure, might take a while, but Taiwan is our friend and needs us more than we need them really, so I presume they will help in the end.
1000000000% agreed.
I will add that ceding manufacturing of all critical products overseas was the start of the real downfall of the US and a terrible, horrible, error. Putting dollars ahead of America, our manufacturing base, and Americans. Horrible, terrible decision shoved onto the US and crippled us irreparably.
One cannot be a first world superpower, when we rely on other nations to make our stuff and supply our stuff to us. Those nations can turn off the supply in a moment. And generational work knowledge/experience/abilities/capabilities are lost in the interim.
It's only a problem when the existing labor force, which is more expensive, is unable to produce higher order goods.
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Offshoring was one of the things that tamed inflation after the 70's. A cheaper labor force was found and taken advantage of, to keep cheap goods flowing to the USA.
Not saying it was a good thing, or that we weren't sold out by our politicians or CEO's, but there are always trade off's. How many people even look at where something is made before they buy it? They simply look at the price. Many companies tried to remain made in USA, and proudly promoted it. A lot of them ended up out of business or offshoring later.
It's hard to 'educate' a person who has no desire to be educated.
Imagine a technology that sustains Moore's Law, thought to be obsolete...
They would never be able to take over Taiwan's semiconductor processing industry. It's simply not possible because they would never get support from the processing equipment manufacturers if they took it over by force. In addition to that, companies like TSMC and UMC don't have enough local talent to keep those plants and processes running and hire an inordinate number of expats who would leave. And I'd think they'd lose whatever support they have now for the fabs in China.
Moore's Law was always about process shrinkage. Performance/area/cost always got better as the technology got reduced in size, but that's running into its limits with silicon because what we have now is approaching the width of an atom. It's not physically possible to get smaller than that.
If we have anything it's not going to quite scale like Moore's Law and probably won't scale down power consumption. I've heard the big thing is now interconnect inside a chip. I don't have anything specific that I've worked on, but that's something that a lot of people in the industry are working on.
Intel is a little bit behind TSMC and Samsung. Nikon and Canon are into EUV.
There are reports that SMIC has a low volume 7 nm process, but that they can't get embedded memories to work. Without embedded memories (or with memories at a larger feature size) they won't have a terribly effective SoC solution.
Who is ASML "behind" ?
They are the leaders with the most advanced equipment, but Nikon and Canon are also subject to export restrictions.
Yep. But a lot of the work to do in making wafers is a bit tedious, as is testing. Lots of education in statistical analysis, lots of data crunching.
I haven’t seen for myself, but when I talk to probe head vendors with their 30,000 needle probe heads, I just shake my head at thinking how to find the bad needle… I’m guessing they put it onto a probe card tester (PRVX? something like that) or just toss the card, it’s not like those high density cards have long lives (product changes too often).
I have always been fascinated by manufacturing. Having worked for a few manufacturers, large and small, it really interests me.
In any case, I am utterly convinced that domestic products need not cost more. I understand that Malco could not produce Vise Grips locally and do so in a cost effective manner, and has since ceased production. However, I would counter with the fact that using old methods of production and expensive American manual labor is not today's method of producing products efficiently.
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This, this is the paradox of Western consumerism. They ***** and moan about jobs going overseas and then ravenously consume the cheapest offshore garbage while complaining about the quality the whole time, knowing full well it's coming from China.
This behaviour of course drives further offshoring because if consumer behaviour demonstrates that they don't really care, what is the purpose of maintaining higher cost Western operations?
