> If that is the cost of keeping the value within the western economies, we should pay. Plain and simple. I'd even argue it's cheap.
No, that is not the cost of keeping "the value" within western economies. It would be the cost of granting the US a leverage against the collective west. The US proved to be a very unreliable and outright hostile partner. At this point, it is not clear whether the US is more hostile to the collective west than the likes of China.
Right , just to remind that China is the country that supports Proxy wars with west ( Ukraine ), supports Iran , a country that placed tariffs on whole industries, like cars, software , spy and buy technology to replace anything advanced.
A country willing to cut mineral supply anytime they don’t like anything is good partner and friend of EU , lol, how delusional someone can be ?
Even current US Administration sends Patriots and military support to Ukraine, while China is sponsoring WAR, help Russia to keep up with war killing people around the world.
China can end that war in 1 week if they really want.
US spent fortune to protect collective west while countries like Germany almost dismantled their army in the past.
Very rational thinking , sure. China will wipe out entire west with technological superiority in the next decade or two without west being united.
US has been a reliable partner post WWII for 95%+ of the time. Making Trump administration representing 100+ years of US history isn't exactly a fair comparison.
If something happens to Taiwan, we won't regret being able to produce these chips domestically. If AI keeps growing like it does, it might even trigger a conflict.
If something happens to Taiwan, the USA will have given a huge military advantage to its biggest adversary.
It's going to take decades for the USA to catch up with Taiwan, and once China has its grip on the fabs they'll only further advance them.
In an existential crisis, the chances of Taiwan's leadership doing a deal with China when it's military protector retreats from its former declarations is in no way low.
It'll be the end of American military dominance but in fitting with the US's repeated isolationist trajectory.
Ah yes, Taiwán - that famously stable nation with no existential threats to its very existence.
I don’t think this is an “if” situation, but rather a “when”. There is no question in my mind - it’s simply too attractive to China. It may not come through all out war, but they will eventually claim what they feel is theirs. They operate on much more manageable time scales.
The global supply chain is now so deeply interwoven that a large geopolitical disruption is nearly impossible. It took explosives for the EU to curtail its Russian natural gas use. And there is still stiff trade with Russia today (not as much as pre war) and lots of folks exploiting the gaps in that system (Turkey, India, china).
Companies charge what the market can bear, not based on their costs. Certainly they will often use some multiplier of their costs as a starting point, and they can't sustainably charge below their costs. But if they double the price of the product and lose more than half of their customers, that's a failure to set pricing properly.
Consider the reverse direction: if a company can decrease costs, they will usually pocket the extra profit, not reduce the price they charge. Price cuts usually only happen for one of two reasons: 1) to avoid losing customers to another company that is charging less (or to entice customers of another company that's charging the same), or 2) to capture more profit if they'll earn more customers at a lower price than they'll lose due to the lower per-unit profit. (Yes, there are other reasons, but these seem to be the main ones.
For goods that are not essential to life, prices are set based on what people are willing to pay vs. how many units can be sold at that price, with the cost as a floor (absent a policy of using a product as a loss leader).
Haven't most things been like this for a very long time? I remember when Chinese tools showed up on the shelves, people will almost always by cheaper, however with tools, there is actually a cost to cheap tools (they suck), with semi-conductors, the cheaper version works just as good in the case of TSMC.
This is not an easy inference. For this inference to be true , you have to know how much of the expense goes to salaries . Also, you have to give credit to tsmc to be world class which enables them to control prices, it may not translate across industries
Its a pretty easy inference for anyone who has mfg experience. The amount you pay per worker versus the quality of work you get back is STARKLY different between US and Taiwanese companies.
What special quality do "western" countries have that makes it a moral obligation to purchase from them over others? Why is it a moral good to keep value from the others?
It's not about that; Taiwan is West-aligned anyway. It's for maintaining some level of self-reliance. Also, basic economics says that trade helps the country's overall economy, but that ignores how it's not applied equally. US manufacturing towns have been hollowed out over the years.
No, I am absolutely not going to pay a 20% premium on the market. I’m sorry but I won’t. If this is really crucial to national security then the government can subsidize the premium. And I know I’m not alone, price speaks louder.
This is not about national security. This is about being more than a simple consumer. If all your society does is consume, eventually, the money runs out.
We need to have know-how, talent and all that stuff to create some value.
We're bleeding all these things by the minute, and I don't want to be around when the critical point is reached.
The government doesn't pay for things, we do through our taxes that they spend. So... instead of paying a markup on just your own consumption, you want to be taxed to pay for the subsidy on EVERYONE'S consumption?
Enjoy not buying any chips next time there is a supply chain hiccup. If COVID didn't teach you this lesson, I don't think you're teachable.
If you're making a product one of the considerations you make is how robust your supply chain is. If you fail to make that consideration you will get eaten by the organizations that do, on a long enough timescale.
It would be un-American to do anything other than what you're suggesting.
There's nothing that represents American values more than respecting the market, and supporting a non-competitive player is the kind of manipulation that could have had all kinds of negative implications, both now and in the past.
Intel is a great example of the fact that between stupidity and low-integrity behavior as a default, the people in charge fuck up in ways that the man on the street would get right.
Defense is starting to get a blank check with fairly bipartisan support for the first time in at least 30-40 years and it's centered on semiconductor supply chains. There has never been a better time to secure the fucking funding, have ASML send twice as many people as they already have, and power through it. The market is whatever you want and the margins are whatever you want: in a functioning system? You fucking do it.
And while I will believe that Intel has suffered serious attrition in key posts, there's no way that the meta-knowledge of how to debug "we don't have the fabs running right, who do we hire, what so we need to give them to get it done" has evaporated in 5-10 years from the singular source of this institutional muscle memory in the history of the world.
The failing here is more like a failing in courage, or stamina, grit, something. It's a failure of the will to do the right thing for both the shareholders and the country.
> It's a failure of the will to do the right thing for both the shareholders and the country.
They've been doing the exact right thing for the shareholders: squeezing the living shit out of an asset (x86/64) for decades while cutting anything interesting or competitive to the bone to give shareholders more money. Money spent on something that could really have been competitive is money not sent to the retirement fund that keeps John and Jane Q. Public swinging in more ways than one at their golf course retirement community in Florida.
The problem is, you can only do that for so long. There is a minimum spend to remain a competitive company with regard to being able to market products to consumers. Executives don't have a fiduciary duty to create the best possible product for consumers to look at and potentially buy in the marketplace, but they do have a fiduciary duty to shareholders to meet an earnings projection. If these two activities can coexist peacefully, great. If not, the first activity stops while the company gets gutted.
The climate of uncertainty under Trump inhibits long-term investment, whether in chip fabs, car factories, or anything else. He has reminded us all of something that's really always been a problem: whatever one Congress or one POTUS supports can be undone by the next.
Usually opposing parties have had the common sense not to immediately hit the undo button once they take office. E.g., Biden leaving most of Trump's previous nutty tariffs in place. But "common sense" isn't on the agenda these days. We are, to all intents and purposes, under attack from within.
> Defense is starting to get a blank check with fairly bipartisan support for the first time in at least 30-40 years and it's centered on semiconductor supply chains.
Really? Because:
> During Donald Trump's 2025 speech to a joint session of Congress, the president asked House Speaker Mike Johnson to “get rid” of the subject act.[190]
Intel's fab issues are overstated in my opinion. They were stuck on 14nm for a very long time because they bit off too much with 10nm. People act like that means ALL research in nodes smaller than 10nm must have stopped, but that's simply not true as research into tech and materials needed for smaller nodes happens in parallel.
It's also noteworthy that GAAFET being a complete redesign of major parts of the manufacturing process levels the playing field significantly. A big example of this is Japan's Rapidus which was founded in 2022 and has managed to invent (and license) enough stuff to be prototyping GAA processes.
Intel's 18a process seems to be quite good. It's behind TSMC in absolute transistor density (SRAM density seems to be the same as N3E), but ahead on hard features like BSPD and maybe on GAA too. I suspect that they didn't push transistor density as hard as they could because BSPD and GAA tech were already big, risky changes.
We'll have a much better idea of Intel's fab future with 14a and 10a as they should show a trend of whether Intel's fabs can catch up and pass TSMC or if they run out of steam after the initial GAA bump.
I think their problem is less about material knowledge to shrink nodes but about development tooling to make chip design more efficient, scalable and allows experimenting with more new approaches/allows larger shifts without planing years ahead for it.
TSMC by collaborating with many different customers with different needs had a lot of insensitive to not just create powerful tooling for one kind of CPU design approach but also being very flexible to allow other approaches for other needs. And AMD has repeatedly interrelated on their whole tool chain and dev. processes for many years while Intel was somewhat complacent with what they had.
And a bunch of the recent issues with CPUs internally dying sound a lot like miss-design issues which tooling should have coughed (instead of looking like fundamental tech/production issues).
> Intel's fab issues are overstated in my opinion.
The fact that they can't use their own fab for 30% of their products [1], all of which are those that require power efficiency and compute performance [2], suggests it is not overstated.
On an emotional level I want to root for Intel (like most of the nerds here, they fabbed a good chunk of the magical elements of my childhood).
It seems difficult to figure out if they are getting back on track, though. They always seem to just be a couple years from finally catching up to TSMC.
I'm not very knowledgeable on all those technical points. How does this explain what I see as a consumer? I built a PC last year and went with AMD while historically I've gone with Intel. For a similarly performing CPU it seemed that AMD was cheaper and more power efficient.
>What I really want to know, from someone who does know: Is Intel cooked?
I dont know if I count, but at least I wrote about TSMC before most if anyone knew much about TSMC. Which is when Apple brought them to spotlight.
It depends on how you define or count as being able to compete with TSMC?
If Intel technically leapfrog TSMC and their 18nm is better than TSMC 20nm this year but;
It is 30 - 40% more expensive.
It has lower Gross margin, or even negative margin.
It has much lower volume and capacity.
It is slower in ramping up capacity for future capacity planning.
It has limited IP range for its foundry.
It has less packaging options.
It does not have other high speed, low power or analog node options.
At what point does it count as competing? Because right now there isn't a single metric that Intel Foundry is winning. And they are feeling exactly the same as Global Foundry or AMD when Intel Foundry advancement is getting all the oxygens.
And even if they did, with a magic wand got them to compete with TSMC on every single one of the item above, in medium to long term there isn't a single chance Intel could compete with their current board and management.
TSMC leadership and management team is Nvidia's level great. I cant think of any other tech company that could rival them. Their only risk is China.
They don’t really need to be better than TSMC, they need to be one node behind and roughly competitive on price / performance.
The first year of TSMCs latest process goes to Apple. And the second few years are booked completely full. There is room for Intel if they can just get in the ballpark of TSMC.
I'm not into hardware but I remember when AMD was sneered at, and all real CPUs were Intel. Then Ryzen happened. My meta conclusion is that its super hard to tell when someone is done, and it can change quickly.
Or not. Sometimes it if looks like terminal decline, it simply is terminal decline.
These things go in cycles and predate Ryzen by a lot. The late-model Pentium 4 chips were overheating power-guzzling garbage compared to the Athlon XP, and the Athlon 64 was a serious competitor to the Core 2 series. Ryzen is the current incarnation of AMD coming into vogue in desktop, but it's not like it took them 40 years to get there.
Everyone thought AMD was done. Intel is going through a difficult transition, but if they can make 18a /14a work and keep improving their GPU line we could be having the same conversation about AMD in 10 years.
Keep in mind Keller joined AMD during their dark period(Bulldozer?) and helped work on Zen.
He later noped out of Intel shortly after joining. Whatever he saw, either in leadership or product, had to be pretty bad in my opinion. AFAIK there's been speculation, but nothing really concrete.
AMDs fab in Dresden was highly respected as the most efficient fab in the world back in it's day. AMD really took off after they purchased NexGen and rolled out the K6.
Intel is more than just fabs. AMD spun off digital foundry forever ago and just uses TSMC, no reason Intel couldn’t do the same. At this point their fabs are a liability. They have a new leader who’s from a semiconductor manufacturing background so I have some faith they’ll give up on the pursuit of next gen fabs and focus instead on their IP. There’s a huge opportunity in their GPU segment. They’ve gone from a joke to competitive in a couple years, and they offer more VRAM for the dollar. They could tailor towards AI and really get some traction there.
Intel outsourcing their core product line is also a massive liability. It's just a different kind of liability.
I personally think the world's reliance on TSMC indicates that fabs are critically important infrastructure. And operating a world class one provides a company with a ton of leverage with governments and other businesses.
> ... I have some faith they’ll give up on the pursuit of next gen fabs and focus instead on their IP.
The problem with Intel is that they are so short sighted and they change direction and focus very quickly. Intel will adopt these seemingly great ideas that require 10-20 year strategies, invest heavily in them, and then abandon them 5 years later. They always measure initiatives against their core CPU line and if they don't show similar profitability in the short term then they defund and eventually cut the programs entirely.
> They have a new leader who’s from a semiconductor manufacturing background
That's the precious leader. The new CEO is not from a semiconductor manufacturing background. His main claim to success is leading a company that built EDA tools.
So we're just going to hand control of the US supply of semiconductors completely over to TSMC, Samsung, and the Chinese fabs in the works? That seems incredibly short sighted and reckless.
They are bringing a lot of that “liability” online in the next few years. You’re ignoring strategic context - as long ad intel maintains domestic fabs it will not be allowed to fail
The top of the market will go GPU and the bottom will go ARM, and the middle will be an ever shrinking x86 market share. The few places that will need heavy CPU resources will be the same people who can apply pressure to Intel's margins.
The process of chip making will look very similar in the future, but the brand of the CPU will matter less every year. Intel's not "dead in five years", but Intel will definitely cross the point of no return in that timeframe. Shifting a big company's focus is more difficult than growing another company who already has the right focus.
I think they have a lot of potential in the dedicated GPU space, but that is a consumer market so profit margins are smaller and they have potential in the low-to-mid-end market so even less margin. It's really sad as the competition there would help consumers.
the sad thing is, it was predictable. Wintel and other monopoly-like deals/situations had removed the need to compete/stay on edge from Intel. They then noticed it too late and made mistakes when trying to course correct/having to much innovation dept to effectively course correct screwed them up big
At the same time AMD again and again re-invented and optimized their development flow and experimented with alternative approaches and did not shy away from cooperating with TSMC and implicitly through that Nivdea and other (sometimes also Intel). Intel on the other hand AFIK got stuck on a approach where they had a edge over AMD but which was seem to have turned out to be somewhat of a dead end.
what is interesting is how TSMC has so far avoided the same kind of trap
- by having competing customers and having deep research co-operations with all the customers they brought competition and innovation back into a monopoly in a round about way like position
- having limited capacity of the newest tech which their competing customers bit for bring in monetary insensitive to innovate
- and them being somewhat of a life line for their country put a lot of pressure onto them to not break their own innovation machine for greed (e.g. by intentionally not expanding the availability of the latest node even when they technically could)
>> I think they have a lot of potential in the dedicated GPU space
I think dedicated GPUs will be dead soon. AMD will beat nVidia with APUs that compete with midrange DGPU in performance with lower system cost. With AI using GPUs we want the shared memory of the APU rather than splitting RAM into two mutually exclusive areas - witness boards starting to use soldered ram in 64 and 128GB configurations. nVidia can't compete without x86 cores and Intel just cant compete for now.
Intel Financial Engineering & Operational Missteps is what led to this.
"Over the past 10 years, Intel engaged in financial engineering, primarily through significant stock buybacks ($53 billion in 2011–2015) and stock-based executive compensation, which diverted resources from innovation and contributed to its lag in semiconductor fabrication. This financialization, as critiqued in the 2021 report, is a long-term factor in Intel’s weakened competitive position"
IMHO the whole user-visible p-core/e-core thing on desktop CPUs is one of the worst decisions in the history of microprocessors. My gaming machines need to do double-duty as as build boxes, so they're just utterly unusable for me.
Why is the asymmetry a show-stopper for you? It would seem like having lots of E-cores would be advantageous for compiling, and still having some P-cores means you don't lose performance when linking.
Intel made mistakes. TSMC can make mistakes. TSMC is also in geopolitically risky Taiwan. I'm not counting out Intel yet.
They're also very unpopular online so it's tough to find solid unbiased info about them. Like is the stink about 18A true or do people just want to hate on Intel?
I find it somewhat ironic that many years ago HP’s PA-RISC chips were fabbed at Intel because contractually they had to supply chips due Itanium not yet taping out.
But maybe it was more of an early foreshadowing. I had a housemate that worked on their internal CAD tools and it also sounded like a bit of a mess with NIH syndrome. (20+ years ago)
They were not caught by corporate raiders (feel free to provide names of outside investors that caused them to stagnate).
Instead of investing in the future and paying top dollar for top employees, the Board paid the shareholders (even 20 years ago). They never even tried to compete for the best employees, and instead let them all go to Alphabet/Apple/Amazon/Meta/Microsoft/Nvidia/Netflix.
Smart people know to choose AMD. OEMs heavily favor Intel for the brand recognition. It's the same on the workstation side, though AMD's market share has been rising quite fast (it's apparently at a 36.5% share) so I'm unsure if system integrators will keep pushing their Intel SKUs so heavily.
So they're not cooked, but they're certainly not doing well and barring a massive jump in performance or efficiency, they're not going to be making a recovery any time soon.
Intel announced new GPUs back in December and seven months later they’re nowhere to be found. I’m pretty convinced at this point that the company has some systemic issues that prevent them from being competitive at any level.
As a data point of one, and one that really doesn't know much about chip fabs, I tend to see the "Intel Inside" sticker as a warning. I have no idea how they ever win back consumer trust.
Yes, Intel is cooked. I think they won't recover anymore. Their fab business' fate will be similar to Global Foundaries: a second tier supplier of old tech nodes.
I see them the same as GE, Boeing, etc. They culture from the top down is screwed. It will take years to undo what has been ingrained in the corporate machine. They will likely survive but as a shell of their former self. They'll probably spin off some promising business related to AI or embedded.
I was disappointed with their offerings and went with AMD for my latested build. I don't know too many people who have built PCs recently, but the few I do know who have or are planning to, everyone is planning to use AMD. Similar to the GE example, it seems many people would recommend LG or Samsung appliances over GE.
Apparently this happening was well telegraphed by people in the industry.
A friend used to send me articles regularly from Semiaccurate in the mid 2010s. I thought it was "alternative truth" but it turns out to have been more, uh, accurate than I thought.
Some of us have been pointing out Intel was in a systematically impossible situation even back when they had that process advantage, now almost a decade ago.
Quite simply imagine being dropped in as CEO of Intel in 2015. Could you have prevented the malaise of today?
Intel’s chances of being a foundry for others are close to 0. It does not matter how good their process technology is. The problem is that Intel was an IP thief in the 80s and 90s; being a foundry requires trusting Intel with the exact IP Intel was known for stealing and nobody wants to take the risk.
Tech-wise places too much premium on the ISA. Modern processor design is fairly orthogonal to the ISA being exposed.
Intel could make exciting RISC-V relatively quickly if they wanted to; what stops them and other companies like this is the strategic asset they perceive their existing ecosystem as.
Yes. I can give you a non-technical answer, since HN is ostensibly business as well.
Intel fired the one CEO that spoke both engineer and business, and Gelsinger could have been their Lisa Su. They fired the only talented CEO they've had for years.
This will be fatal.
Gelsinger was the scapegoat for 20+ years of inability to compete with foreign companies, no matter how much money was poured into them. They used American exceptionalism as a cover to defraud shareholders and any government that invested in them. They used the relationship of AIPAC and Congress to build a fab and R&D lab in Israel (inserting yourself into global politics to make a buck is always spicy) at low cost to them.
Taiwan became the capitol of electrical engineering in the world, and is a shining example of how to survive and thrive in a post-war era, and it absolutely shows. They caught up to Intel and zoomed right past.
Gelsinger's crime was try to do what AMD did: they didn't have a fab that could make their chip BUT they had a fab that made chips that people wanted AND the foundry could take that work and survive if they legally split. GloFo is now the third largest semi foundry in the world today, and when it was part of AMD, it very much wasn't; I can't quite remember, but 5th or 6th? Something like that. GloFo is #3, TSMC is #1, Samsung is #2, and Intel could very well be that #4, and push out UMC (#4) and SMIC (#5) in the secondary chip foundry market.
Gelsinger could have split Intel into Intel and IFoundry or something, and Intel could have profited on IFoundry taking off and taking external work. Right now, IFoundry can't compete on top nodes, but _could_ steal work from all other fabs for secondary larger nodes. Having a working 12 nm competitor as well as a working 7nm competitor is big business, which Intel currently has _ZERO_ of (since they don't take external contracts). Gelsinger was big on this potential revenue stream.
Gelsinger's other crime was being part of the negotiation between TSMC and the Biden administration for the CHIPs act money: part of what built the TSMC fab right next door to Intel's in Arizona was Biden and Intel money. Intel was investing in it's future by playing the American exceptionalism card again, but now in everybody's favor. We _all_ benefit from this. Gelsinger wanted to have _somebody_ fab the chips, and if its good enough for AMD, Apple, and Nvidia, its good enough for Intel.
There is zero indication that GAA 20A is ready, and Intel has a history of having leadership that says such-and-such is ready for it to either come out several gens later, or just vanish off the roadmap. Gelsinger's other OTHER crime is admitting to this and changing the direction of the Titanic before it hits the iceberg, for the CEO that replaced him just to steer right back into the iceberg.
I have _zero_ faith in Intel's leadership if they can't bring Gelsinger back. Tan, Gelsinger's replacement, is a former board member. I have no reason to think he is not just going to further poison the company. Tan has not spoken about any plan that indicates he understands Intel is not competitive, Intel cannot competitively make 100% of the tiles, that Intel's Foveros tech stack is extremely valuable because the only truly comparative alternative is TSMC's CoWoS tech family and superior to it and people are willing to throw money at that problem but they can't license it as long as IFoundry is part of Intel.
Intel has been in Israel since 1974. Intel Fab 8 was built in 1980 in Jerusalem... There's over 30,000 chip engineers and nearly 200 semiconductor companies there, now.
I am no expert in Intel, but in my view, Gelsinger lost the faith of many by being unrealistically optimistic.
Of course a CEO needs to be optimistic, but he promised (in 2021) zettaflop systems by 2027 (the worst example I remember). Did anyone believe that could happen?
His over-optimism gave the whole "5 nodes in 4 years" supposed path to leadership a weird flavor, like it must be somehow a bit of a con even if it gets technically achieved.
Cooked in the short/medium term, yes, but remains to be seen in the longer term. I feel like they’re ironically in the same position AMD was in before AMD spun off Global Foundries: not being able to keep up with the new nodes on the manufacturing side, which also drags down the design side. They could follow the same playbook and sell off the foundries, which will be a blow to their pride, but should free them up to compete better on designs alone.
Why is the government bailing them out then? Is that just good money thrown after bad?
Regardless, it seems like the company leadership should be gutted (the same could be said of Boeing) and the company given over to a new technically-grounded leadership team.
A lot of people misunderstand why companies outsource to Asia. It’s not just about cost—it’s actually more so about manufacturing expertise.
Asia has a massive pool of highly skilled manufacturing talent, and that kind of deep expertise is something the U.S. is quickly forgetting.
So my question is: with TSMC building a fab in the U.S., are Americans actually getting retrained in real manufacturing skills? Or are they just being taught to push the buttons TSMC tells them to push?
Was the US ever a major manufacturer of even pre-IC solid state electronics?
I was born in 1978 and was really into Heathkits and breadboard projects and stuff when I was a child and early teen. My dad was (and still is) an analog electronic engineer and gave me lots of surplus oscilloscopes and frequency counters and other coolness too. I distinctly remember often seeing "Made in Korea," "Made in Japan," "Made in Taiwan," etc. on circuit boards and chassis assemblies. The single word "Korea" was very common on components. This would have mostly been stuff from the late 1970s and 1980s.
At the very least it seems like electronics from at least the early-mid solid state era onward into the IC era has always been a globalized industry with a globalized supply chain. I feel like you've got to go back to vacuum tubes to find self-contained nationalized electronics industries.
Back then as now a lot of stuff was designed in the USA and Europe but manufactured elsewhere. Just like Asia has a ton of top tier manufacturing and logistics talent, the US and Europe have a ton of top tier design engineering and coding talent.
I still do agree that there is strategic value in making sure the US at least has some domestic capacity to manufacture leading-edge chips and electronics, not just to maintain some talent here but in case a major global conflict breaks out that deeply fractures all these supply chains. Same for Europe and any other country. China meanwhile would do well to develop its own domestic software and design talent pool.
It was called silicon valley for a reason. From the 1950s until the 1980s, the US was the dominate manufacturer of integrated circuits and the the origin of most fo the technology.
Everything started to globalize starting in the late 1970s to early 1980s which really kicked off with the end of the gold standard and the Volker Shock.
The Japanese and Germans, which had IC industry already, picked up steam and started to export as the economics changed.
China, Korea, Vietnam, etc. are recent entries (2000s)
There's a big difference in manufacturing between operators (the ones pushing the buttons), and plant engineers and designers. Assuming the process has been designed and built correctly, the button pushers can push buttons, and identify when not to push the buttons, and that's fine.
The US has plenty of manufacturing operations much more complicated than building CPUs, so of course we can do it. Manufacturing expertise in Asia (as I understand it) comes down more to macro-level processes, where different components might be built or raw ingredients sourced near each other, so further assembly can be done easier than any place in the United States.
The US has plenty of manufacturing operations much more complicated than building CPUs
It's my understanding that this is not the case. That CPU (and similar) manufacturing is considered one of the most complex processes humanity has ever developed. What are these plenty of manufacturing operations that are more complicated?
I dunno, it still sounds like a cost thing. Somehow all the places where people have "the right skills" happen to have very low wages, as long as they're stable countries. And some professions like automaking were much bigger in the US before they started outsourcing due to cost (unions factored in).
I see the point being made here, and yeah 5%-20% extra for what amounts to insurance against geopolitics isn't too bad, but doesn't this all fall apart when China catches up?
That 5%-20% is worth it now because no one else can fabricate competing chips. In a competitive market, 5%-20% can be the difference between having the price edge or not. I understand why the USA wants TSMC to manufacture outside of Taiwan, but perhaps it makes sense to move it not the USA but, say, Mexico?
Chinese car companies seem to be slowly but surely rolling American car companies in international markets with great value at low prices. The move in this market evidently isn't to move manufacturing away from Mexico at a 5%-20% increase in price.
In the chip market there's less immediate competition, but I can only imagine it'll come. Hopefully economies of scale would have removed this extra 5%-20% by the time China catches up?
> I see the point being made here, and yeah 5%-20% extra for what amounts to insurance against geopolitics isn't too bad
Well that is an insurance only for the US. As a european, I feel safer, or at best neutral, knowing my ships are made in the Taiwan rather than the US, so having them more 5-20% more expensive is not competitive.
With all their antagonizing of allies, and predatory privacy laws, and repeated espionage on allies, the US has disintegrated any trust other parties have to buy things made there.
As a European I would like geographically and politically dispersed production lines for one of the most important products of the 21 century. Domestic production would be idal, but whatever we can get is a plus.
Because Taiwan is a small, earthquake prone island perpetually on the brink of invasion of a superpower 180 kilometers away. And antagonizing, predatory privacy laws and espionage is also an issue with CCP, however we still import a lot of electronics and semiconductors from there.
What are you going to do when China invades Taiwan, though?
If rumors are to be believed, TSMC will scuttle their fabs before they fall into Chinese hands. Even if they don't, or fail to execute, Taiwan-based chip production will be disrupted for years.
Bet you'll be happy that TSMC has fabs in the US, despite your understandable misgivings.
Credit where credit is due: Australia, UK, New Zealand and Canada are all doing their major parts in espionage on each other and everyone else as a service as part of Five Eyes.
As a European myself, I am pretty miffed that my fellow Europeans keep acting like we're not leading the charge when it comes to spying on each other.
With China, the issue isn't really the quality of the product. It's the geopolitical issues.
Japan, Korea, Taiwan, and other countries even Philippines and Vietnam don't want to depend too much on China. A lot of island disputes and so on and so forth.
My guess right now is that China will never catch up because Europe, US, Australia, and many other developing countries will avoid depending on China critically. This doesn't mean 0% would buy from China but it'll never become a critical dependency.
It's a real shame that the U.S is alienating it's allies through aggressive economic policy. Maybe we'll find ourselves on the wrong side of that economically resilient policy.
> My guess right now is that China will never catch up because [..]
The problem China is big enough to catch up just by it depending on itself + some cheap mass consumer market outlets to even further scale production.
Like they have 1408 Million people ~3times the US and their education system tries (at least of paper) to give everyone a chance to reach silence excellence iff (and only iff) they are noticeable above average (but also due to the form of their education system for people which certain kinds of approaches to thinking which is a major handicap they gave themself accidentally). Like either way with that population size, priority on catching up on chip production, willingness to steal science (through it's not like the US doesn't have a habit for that, too) it's just a matter of time until they have some truly genius people put into the right kind of position with the right kind of resources which will close the gap step by step.
Oh they will catch up as TSMC amd Samsung are running out of steam and Intel is imploding. There's nothing better than motivating China to take on this monumental effort than thd tariffs and export controls.
A 5-20% markup on CPUs isn't the worst thing, but those still need a mobo to socket into and as far as I'm aware we still don't have much capability on the availability of boards. Are there any companies that are spinning up board production, or even just broader consumer electronics in general (arduinos, pis, general controllers and the like)?
Maybe not, but if the entire country doesn’t have the ability to manufacture it, then it’s still going to be a strategic weakness when push comes to shove. The entire exercise of doing more chip manufacturing in the U.S. is about maintaining national competitiveness and independence. It’s certainly not about cost. So I think it’s a good point that investments should made to be able to onshore the entire stack rather than just the top end.
Yea, I work in the industry. There are players, but not exactly bountiful. Really the backbone of American electronics manufacturing is military spending. If the defense budget went away, there would be close to zero PCB manufacturers left. China makes higher quality boards, faster and for dramatically less money.
Worse - to manufacture usable boards, you need everything from the CPU socket and northbridge chip down to the dust-mote-sized discrete components that are mounted on it. Plus RAM, and ...
'Most all of which falls square into your "low tech and low profit", from a right-thinking* American company's PoV.
Not to say that a saintly American company could do much better, if it tried to swim uphill against America's vastly-higher cost of living (vs. the countries where most of that stuff's manufactured). And other problems beyond its control.
If there is a reason to want to in-house the fabrication of chips then it seems silly to not extend that to at least the boards that house them, otherwise we wind up still being reliant on an international supply chain which seems to defeat the purpose.
Even if it was just motherboards in particular and not others, that seems like a necessary step in securing the supply chain and if we only do that for national defense the benefits of competition likely won't extend to consumers that are still exposed to trade taxation.
PCBs are relatively easy to make. But there's a whole supply chain of plastic bits and pieces, screws, materials, etc that the MBAs decided decades ago should come from the lowest cost region.
> “I think the economics of it are we have to consider the resiliency of the supply chain, I think we learned that during the pandemic — the idea that you think about your supply chains not just by the lowest cost, but also about reliability, about resiliency, and all those things. I think that’s how we’re thinking about U.S. manufacturing,” [AMD CEO Lia Su] said to Bloomberg’s Ed Ludlow.
This almost sounds verbatim what U.S. Secretary of the Treasury Scott Bessent told Bloomberg yesterday, so take the headline phrase “worth it” in that context.
The article doesn’t say, but I assume these are SOTA AI chips? If so, it’s a huge deal that American can build them.
Another interesting point:
> AMD and larger rival Nvidia Corp. recently gained a reprieve on restrictions imposed on shipments of some types of artificial intelligence accelerators to China. It’s still not clear how many licenses will be granted — or how long the companies will be allowed to ship the chips to the country, the biggest market for semiconductors.
It sounds like they’re trying to give China some chips but not as many as American allied countries. I wonder if they’re trying to get China “addicted” to western AI chips to hurt Chinese chip manufacturing development?
They can make advanced chips in Arizona, but the bleeding edge is in Taiwan. Arizona can make TSMC’s 4nm process, but in Taiwan they’re doing 3nm and ramping up 2nm.
Export restrictions work similarly to tariffs or subsidies. In the long term they limit domestic products from global competition. DeepSeek comes up with more efficient algorithms out of necessity to compete using lesser hardware. Companies with deep pockets like OpenAI will be first and best, but only for a limited period if they don't invest in efficiency as well as capability.
That is certainly what they are lobbying for and I think I agree with the lobbyists for once. Huawei is shaping up to become a strong competitor if left at it and it's probably in the US's best interest to just let Nvidia and AMD sell to China to maintain the hardware monopoly for longer.
Exactly what most AI researchers would have predicted, if you force like 30% of the worlds top ai researchers to use something other than CUDA, they’ll work on improving the tools for something other than CUDA.
It’s wild the same administrations would argue for restricting access to the US market for tariffs to strengthen domestic production, would not believe that severely restricting exports to the Chinese market would strengthen their domestic production
> I wonder if they’re trying to get China “addicted” to western AI chips to hurt Chinese chip manufacturing development?
This has nothing to do with that. It was part of the deal made with China recently in Geneva. The U.S. needs what China has (rare metals), and China needs what the U.S. has (SOTA chips).
> (rare metals in a place where nobody cares how they're harvested as opposed to the ones in North America that can't be mined due to ecological concerns)
Readit News
https://www.bloomberg.com/news/articles/2025-07-23/amd-ceo-s...
No, that is not the cost of keeping "the value" within western economies. It would be the cost of granting the US a leverage against the collective west. The US proved to be a very unreliable and outright hostile partner. At this point, it is not clear whether the US is more hostile to the collective west than the likes of China.
A country willing to cut mineral supply anytime they don’t like anything is good partner and friend of EU , lol, how delusional someone can be ?
Even current US Administration sends Patriots and military support to Ukraine, while China is sponsoring WAR, help Russia to keep up with war killing people around the world.
China can end that war in 1 week if they really want.
US spent fortune to protect collective west while countries like Germany almost dismantled their army in the past.
Very rational thinking , sure. China will wipe out entire west with technological superiority in the next decade or two without west being united.
> It would be the cost of granting the US a leverage against the collective west.
Bad faith argument. “Collective west” as if the entire west aside from the US is a united bloc. Laughable.
For the rest of the world, Taiwan with a "China Risk" looks like a safer bet than the USA.
Such that the market forces don't push pricing that the plant would naturally die.
[0] https://en.wikipedia.org/wiki/Phoebus_cartel
It's going to take decades for the USA to catch up with Taiwan, and once China has its grip on the fabs they'll only further advance them.
In an existential crisis, the chances of Taiwan's leadership doing a deal with China when it's military protector retreats from its former declarations is in no way low.
It'll be the end of American military dominance but in fitting with the US's repeated isolationist trajectory.
I don’t think this is an “if” situation, but rather a “when”. There is no question in my mind - it’s simply too attractive to China. It may not come through all out war, but they will eventually claim what they feel is theirs. They operate on much more manageable time scales.
This isn't really a workable argument any more. As examples:
https://apnews.com/article/north-carolina-quartz-hurricane-5...
https://archive.is/sM16Y
The global supply chain is now so deeply interwoven that a large geopolitical disruption is nearly impossible. It took explosives for the EU to curtail its Russian natural gas use. And there is still stiff trade with Russia today (not as much as pre war) and lots of folks exploiting the gaps in that system (Turkey, India, china).
If you have never read it I highly recommend I, Pencil: https://oll.libertyfund.org/titles/read-i-pencil-my-family-t...
In Europe nobody is going to pay extra for a gadget that comes with an American chip inside it, they will just buy Chinese.
The result will be like automotive with the Chicken Tax, with Americans having pickup trucks and the rest of the world having crossover SUVs.
Consider the reverse direction: if a company can decrease costs, they will usually pocket the extra profit, not reduce the price they charge. Price cuts usually only happen for one of two reasons: 1) to avoid losing customers to another company that is charging less (or to entice customers of another company that's charging the same), or 2) to capture more profit if they'll earn more customers at a lower price than they'll lose due to the lower per-unit profit. (Yes, there are other reasons, but these seem to be the main ones.
For goods that are not essential to life, prices are set based on what people are willing to pay vs. how many units can be sold at that price, with the cost as a floor (absent a policy of using a product as a loss leader).
I am no expert in BoM and margins, but that seems like a wild claim to me. Could you explain your math?
Purchasing products made under autocratic regimes strengthens those regimes and gives them more power on the world stage.
I think "moral obligation" (a phrase the GP did not use, for the record) is a bit over the top, though.
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Ffs, take a look at how many superfund sites Silicon Valley has, from back when we manufactured semiconductors.
We need to have know-how, talent and all that stuff to create some value. We're bleeding all these things by the minute, and I don't want to be around when the critical point is reached.
If you're making a product one of the considerations you make is how robust your supply chain is. If you fail to make that consideration you will get eaten by the organizations that do, on a long enough timescale.
There's nothing that represents American values more than respecting the market, and supporting a non-competitive player is the kind of manipulation that could have had all kinds of negative implications, both now and in the past.
The State choosing winners... smh.
/s (but only partially)
They used to be a crown-jewel of US tech. But it seems like every time I read the news, they are announcing a delay or shutting down some product.
Defense is starting to get a blank check with fairly bipartisan support for the first time in at least 30-40 years and it's centered on semiconductor supply chains. There has never been a better time to secure the fucking funding, have ASML send twice as many people as they already have, and power through it. The market is whatever you want and the margins are whatever you want: in a functioning system? You fucking do it.
And while I will believe that Intel has suffered serious attrition in key posts, there's no way that the meta-knowledge of how to debug "we don't have the fabs running right, who do we hire, what so we need to give them to get it done" has evaporated in 5-10 years from the singular source of this institutional muscle memory in the history of the world.
The failing here is more like a failing in courage, or stamina, grit, something. It's a failure of the will to do the right thing for both the shareholders and the country.
They've been doing the exact right thing for the shareholders: squeezing the living shit out of an asset (x86/64) for decades while cutting anything interesting or competitive to the bone to give shareholders more money. Money spent on something that could really have been competitive is money not sent to the retirement fund that keeps John and Jane Q. Public swinging in more ways than one at their golf course retirement community in Florida.
The problem is, you can only do that for so long. There is a minimum spend to remain a competitive company with regard to being able to market products to consumers. Executives don't have a fiduciary duty to create the best possible product for consumers to look at and potentially buy in the marketplace, but they do have a fiduciary duty to shareholders to meet an earnings projection. If these two activities can coexist peacefully, great. If not, the first activity stops while the company gets gutted.
Usually opposing parties have had the common sense not to immediately hit the undo button once they take office. E.g., Biden leaving most of Trump's previous nutty tariffs in place. But "common sense" isn't on the agenda these days. We are, to all intents and purposes, under attack from within.
Really? Because:
> During Donald Trump's 2025 speech to a joint session of Congress, the president asked House Speaker Mike Johnson to “get rid” of the subject act.[190]
* https://en.wikipedia.org/wiki/CHIPS_and_Science_Act#Subseque...
It's also noteworthy that GAAFET being a complete redesign of major parts of the manufacturing process levels the playing field significantly. A big example of this is Japan's Rapidus which was founded in 2022 and has managed to invent (and license) enough stuff to be prototyping GAA processes.
Intel's 18a process seems to be quite good. It's behind TSMC in absolute transistor density (SRAM density seems to be the same as N3E), but ahead on hard features like BSPD and maybe on GAA too. I suspect that they didn't push transistor density as hard as they could because BSPD and GAA tech were already big, risky changes.
We'll have a much better idea of Intel's fab future with 14a and 10a as they should show a trend of whether Intel's fabs can catch up and pass TSMC or if they run out of steam after the initial GAA bump.
TSMC by collaborating with many different customers with different needs had a lot of insensitive to not just create powerful tooling for one kind of CPU design approach but also being very flexible to allow other approaches for other needs. And AMD has repeatedly interrelated on their whole tool chain and dev. processes for many years while Intel was somewhat complacent with what they had.
And a bunch of the recent issues with CPUs internally dying sound a lot like miss-design issues which tooling should have coughed (instead of looking like fundamental tech/production issues).
The fact that they can't use their own fab for 30% of their products [1], all of which are those that require power efficiency and compute performance [2], suggests it is not overstated.
[1] https://www.tomshardware.com/tech-industry/intel-will-keep-u...
[2] https://www.extremetech.com/gaming/intel-is-using-tsmc-4nm-f...
18A is canceled for foundry customers, it's not going to save them. If they can't get it together for 14A, they are toast.
It seems difficult to figure out if they are getting back on track, though. They always seem to just be a couple years from finally catching up to TSMC.
I would be very surprised if 14a and 10a comes out soon enough to be competitive with TSMC.
I dont know if I count, but at least I wrote about TSMC before most if anyone knew much about TSMC. Which is when Apple brought them to spotlight.
It depends on how you define or count as being able to compete with TSMC?
If Intel technically leapfrog TSMC and their 18nm is better than TSMC 20nm this year but;
It is 30 - 40% more expensive.
It has lower Gross margin, or even negative margin.
It has much lower volume and capacity.
It is slower in ramping up capacity for future capacity planning.
It has limited IP range for its foundry.
It has less packaging options.
It does not have other high speed, low power or analog node options.
At what point does it count as competing? Because right now there isn't a single metric that Intel Foundry is winning. And they are feeling exactly the same as Global Foundry or AMD when Intel Foundry advancement is getting all the oxygens.
And even if they did, with a magic wand got them to compete with TSMC on every single one of the item above, in medium to long term there isn't a single chance Intel could compete with their current board and management.
TSMC leadership and management team is Nvidia's level great. I cant think of any other tech company that could rival them. Their only risk is China.
The first year of TSMCs latest process goes to Apple. And the second few years are booked completely full. There is room for Intel if they can just get in the ballpark of TSMC.
Think you mean 1.8nm, aka 18A. We're way past 18nm and 20nm.
Dead Comment
Or not. Sometimes it if looks like terminal decline, it simply is terminal decline.
Yes, building top-of-the-line CPUs is hard and it's impressive that we saw the dominance flip in the course of just a few years.
But I think frontier chip fabrication is a bigger juggernaut than "mere" CPU design.
(Your conclusion could still be correct, but I don't know if I buy the high-level reasoning).
I think the big fear here is that if Intel does the same, there won't be much competition left in the fab space.
Is Samsung still competitive with TSMC?
He later noped out of Intel shortly after joining. Whatever he saw, either in leadership or product, had to be pretty bad in my opinion. AFAIK there's been speculation, but nothing really concrete.
They don't want to be competitive they want to bleed the company dry.
Intel outsourcing their core product line is also a massive liability. It's just a different kind of liability.
I personally think the world's reliance on TSMC indicates that fabs are critically important infrastructure. And operating a world class one provides a company with a ton of leverage with governments and other businesses.
Intel is doing the same. IDK if they are working on new fabs at this point, but the last few generations of chips from intel have used TSMC.
My expectation is that Intel might still run fabs, but they'll be mostly contracting them out to people who want cheap ASICs and 10 year old fab tech.
If everyone chases higher margin and ditches their fabs what kind of industry are we left with? One giant fab company like TSMC? That sounds healthy!
The problem with Intel is that they are so short sighted and they change direction and focus very quickly. Intel will adopt these seemingly great ideas that require 10-20 year strategies, invest heavily in them, and then abandon them 5 years later. They always measure initiatives against their core CPU line and if they don't show similar profitability in the short term then they defund and eventually cut the programs entirely.
That's the precious leader. The new CEO is not from a semiconductor manufacturing background. His main claim to success is leading a company that built EDA tools.
So we're just going to hand control of the US supply of semiconductors completely over to TSMC, Samsung, and the Chinese fabs in the works? That seems incredibly short sighted and reckless.
global* foundry
https://news.ycombinator.com/item?id=14588429
The top of the market will go GPU and the bottom will go ARM, and the middle will be an ever shrinking x86 market share. The few places that will need heavy CPU resources will be the same people who can apply pressure to Intel's margins.
The process of chip making will look very similar in the future, but the brand of the CPU will matter less every year. Intel's not "dead in five years", but Intel will definitely cross the point of no return in that timeframe. Shifting a big company's focus is more difficult than growing another company who already has the right focus.
I think they have a lot of potential in the dedicated GPU space, but that is a consumer market so profit margins are smaller and they have potential in the low-to-mid-end market so even less margin. It's really sad as the competition there would help consumers.
the sad thing is, it was predictable. Wintel and other monopoly-like deals/situations had removed the need to compete/stay on edge from Intel. They then noticed it too late and made mistakes when trying to course correct/having to much innovation dept to effectively course correct screwed them up big
At the same time AMD again and again re-invented and optimized their development flow and experimented with alternative approaches and did not shy away from cooperating with TSMC and implicitly through that Nivdea and other (sometimes also Intel). Intel on the other hand AFIK got stuck on a approach where they had a edge over AMD but which was seem to have turned out to be somewhat of a dead end.
what is interesting is how TSMC has so far avoided the same kind of trap
- by having competing customers and having deep research co-operations with all the customers they brought competition and innovation back into a monopoly in a round about way like position
- having limited capacity of the newest tech which their competing customers bit for bring in monetary insensitive to innovate
- and them being somewhat of a life line for their country put a lot of pressure onto them to not break their own innovation machine for greed (e.g. by intentionally not expanding the availability of the latest node even when they technically could)
I think dedicated GPUs will be dead soon. AMD will beat nVidia with APUs that compete with midrange DGPU in performance with lower system cost. With AI using GPUs we want the shared memory of the APU rather than splitting RAM into two mutually exclusive areas - witness boards starting to use soldered ram in 64 and 128GB configurations. nVidia can't compete without x86 cores and Intel just cant compete for now.
"Over the past 10 years, Intel engaged in financial engineering, primarily through significant stock buybacks ($53 billion in 2011–2015) and stock-based executive compensation, which diverted resources from innovation and contributed to its lag in semiconductor fabrication. This financialization, as critiqued in the 2021 report, is a long-term factor in Intel’s weakened competitive position"
https://semianalysis.com/2024/12/09/intel-on-the-brink-of-de...
https://www.ineteconomics.org/perspectives/blog/how-intel-fi...
https://www.intc.com/news-events/press-releases/detail/1726/...
IMHO the whole user-visible p-core/e-core thing on desktop CPUs is one of the worst decisions in the history of microprocessors. My gaming machines need to do double-duty as as build boxes, so they're just utterly unusable for me.
They're also very unpopular online so it's tough to find solid unbiased info about them. Like is the stink about 18A true or do people just want to hate on Intel?
But maybe it was more of an early foreshadowing. I had a housemate that worked on their internal CAD tools and it also sounded like a bit of a mess with NIH syndrome. (20+ years ago)
I live in the area and know a LOT of intel fab workers.
The issue is not the workers: Intel has been captured by corporate raiders and toxic management.
They aren't interested in making chips or an innovative company. They just want to squeeze the juice out of the company until it is dry.
That is why it is so bad.
Instead of investing in the future and paying top dollar for top employees, the Board paid the shareholders (even 20 years ago). They never even tried to compete for the best employees, and instead let them all go to Alphabet/Apple/Amazon/Meta/Microsoft/Nvidia/Netflix.
This includes the employees in management.
Could you explain to those of us who don't understand how corporate raiders have influenced Intel's strategy?
Smart people know to choose AMD. OEMs heavily favor Intel for the brand recognition. It's the same on the workstation side, though AMD's market share has been rising quite fast (it's apparently at a 36.5% share) so I'm unsure if system integrators will keep pushing their Intel SKUs so heavily.
So they're not cooked, but they're certainly not doing well and barring a massive jump in performance or efficiency, they're not going to be making a recovery any time soon.
Deleted Comment
I was disappointed with their offerings and went with AMD for my latested build. I don't know too many people who have built PCs recently, but the few I do know who have or are planning to, everyone is planning to use AMD. Similar to the GE example, it seems many people would recommend LG or Samsung appliances over GE.
A friend used to send me articles regularly from Semiaccurate in the mid 2010s. I thought it was "alternative truth" but it turns out to have been more, uh, accurate than I thought.
Quite simply imagine being dropped in as CEO of Intel in 2015. Could you have prevented the malaise of today?
I feel like x86 itself is kinda legacy tech. So while AMD has made advancements, they're somewhat in the same boat as Intel.
It seems like NVIDIA and Micron are the real "crown jewels" of US tech
Intel could make exciting RISC-V relatively quickly if they wanted to; what stops them and other companies like this is the strategic asset they perceive their existing ecosystem as.
It's like saying that programming language syntax/keywords are better than the other.
Everything is about compiler, lib, runtime, etc.
https://chipsandcheese.com/p/arm-or-x86-isa-doesnt-matter
Also some people say that RISC-V is the way to go
The impact of ISA is overrated, it's much more important that the ISA continues to grow and adapt as CPUs get larger.
nVidia market cap is 4T or about 40x Intels. Im not sure who those smart people are.
Intel fired the one CEO that spoke both engineer and business, and Gelsinger could have been their Lisa Su. They fired the only talented CEO they've had for years.
This will be fatal.
Gelsinger was the scapegoat for 20+ years of inability to compete with foreign companies, no matter how much money was poured into them. They used American exceptionalism as a cover to defraud shareholders and any government that invested in them. They used the relationship of AIPAC and Congress to build a fab and R&D lab in Israel (inserting yourself into global politics to make a buck is always spicy) at low cost to them.
Taiwan became the capitol of electrical engineering in the world, and is a shining example of how to survive and thrive in a post-war era, and it absolutely shows. They caught up to Intel and zoomed right past.
Gelsinger's crime was try to do what AMD did: they didn't have a fab that could make their chip BUT they had a fab that made chips that people wanted AND the foundry could take that work and survive if they legally split. GloFo is now the third largest semi foundry in the world today, and when it was part of AMD, it very much wasn't; I can't quite remember, but 5th or 6th? Something like that. GloFo is #3, TSMC is #1, Samsung is #2, and Intel could very well be that #4, and push out UMC (#4) and SMIC (#5) in the secondary chip foundry market.
Gelsinger could have split Intel into Intel and IFoundry or something, and Intel could have profited on IFoundry taking off and taking external work. Right now, IFoundry can't compete on top nodes, but _could_ steal work from all other fabs for secondary larger nodes. Having a working 12 nm competitor as well as a working 7nm competitor is big business, which Intel currently has _ZERO_ of (since they don't take external contracts). Gelsinger was big on this potential revenue stream.
Gelsinger's other crime was being part of the negotiation between TSMC and the Biden administration for the CHIPs act money: part of what built the TSMC fab right next door to Intel's in Arizona was Biden and Intel money. Intel was investing in it's future by playing the American exceptionalism card again, but now in everybody's favor. We _all_ benefit from this. Gelsinger wanted to have _somebody_ fab the chips, and if its good enough for AMD, Apple, and Nvidia, its good enough for Intel.
There is zero indication that GAA 20A is ready, and Intel has a history of having leadership that says such-and-such is ready for it to either come out several gens later, or just vanish off the roadmap. Gelsinger's other OTHER crime is admitting to this and changing the direction of the Titanic before it hits the iceberg, for the CEO that replaced him just to steer right back into the iceberg.
I have _zero_ faith in Intel's leadership if they can't bring Gelsinger back. Tan, Gelsinger's replacement, is a former board member. I have no reason to think he is not just going to further poison the company. Tan has not spoken about any plan that indicates he understands Intel is not competitive, Intel cannot competitively make 100% of the tiles, that Intel's Foveros tech stack is extremely valuable because the only truly comparative alternative is TSMC's CoWoS tech family and superior to it and people are willing to throw money at that problem but they can't license it as long as IFoundry is part of Intel.
Intel is cooked imnsho.
His over-optimism gave the whole "5 nodes in 4 years" supposed path to leadership a weird flavor, like it must be somehow a bit of a con even if it gets technically achieved.
Regardless, it seems like the company leadership should be gutted (the same could be said of Boeing) and the company given over to a new technically-grounded leadership team.
Asia has a massive pool of highly skilled manufacturing talent, and that kind of deep expertise is something the U.S. is quickly forgetting.
So my question is: with TSMC building a fab in the U.S., are Americans actually getting retrained in real manufacturing skills? Or are they just being taught to push the buttons TSMC tells them to push?
I was born in 1978 and was really into Heathkits and breadboard projects and stuff when I was a child and early teen. My dad was (and still is) an analog electronic engineer and gave me lots of surplus oscilloscopes and frequency counters and other coolness too. I distinctly remember often seeing "Made in Korea," "Made in Japan," "Made in Taiwan," etc. on circuit boards and chassis assemblies. The single word "Korea" was very common on components. This would have mostly been stuff from the late 1970s and 1980s.
At the very least it seems like electronics from at least the early-mid solid state era onward into the IC era has always been a globalized industry with a globalized supply chain. I feel like you've got to go back to vacuum tubes to find self-contained nationalized electronics industries.
Back then as now a lot of stuff was designed in the USA and Europe but manufactured elsewhere. Just like Asia has a ton of top tier manufacturing and logistics talent, the US and Europe have a ton of top tier design engineering and coding talent.
I still do agree that there is strategic value in making sure the US at least has some domestic capacity to manufacture leading-edge chips and electronics, not just to maintain some talent here but in case a major global conflict breaks out that deeply fractures all these supply chains. Same for Europe and any other country. China meanwhile would do well to develop its own domestic software and design talent pool.
Everything started to globalize starting in the late 1970s to early 1980s which really kicked off with the end of the gold standard and the Volker Shock.
The Japanese and Germans, which had IC industry already, picked up steam and started to export as the economics changed.
China, Korea, Vietnam, etc. are recent entries (2000s)
The US has plenty of manufacturing operations much more complicated than building CPUs, so of course we can do it. Manufacturing expertise in Asia (as I understand it) comes down more to macro-level processes, where different components might be built or raw ingredients sourced near each other, so further assembly can be done easier than any place in the United States.
It's my understanding that this is not the case. That CPU (and similar) manufacturing is considered one of the most complex processes humanity has ever developed. What are these plenty of manufacturing operations that are more complicated?
That 5%-20% is worth it now because no one else can fabricate competing chips. In a competitive market, 5%-20% can be the difference between having the price edge or not. I understand why the USA wants TSMC to manufacture outside of Taiwan, but perhaps it makes sense to move it not the USA but, say, Mexico?
Chinese car companies seem to be slowly but surely rolling American car companies in international markets with great value at low prices. The move in this market evidently isn't to move manufacturing away from Mexico at a 5%-20% increase in price.
In the chip market there's less immediate competition, but I can only imagine it'll come. Hopefully economies of scale would have removed this extra 5%-20% by the time China catches up?
Well that is an insurance only for the US. As a european, I feel safer, or at best neutral, knowing my ships are made in the Taiwan rather than the US, so having them more 5-20% more expensive is not competitive.
With all their antagonizing of allies, and predatory privacy laws, and repeated espionage on allies, the US has disintegrated any trust other parties have to buy things made there.
Because Taiwan is a small, earthquake prone island perpetually on the brink of invasion of a superpower 180 kilometers away. And antagonizing, predatory privacy laws and espionage is also an issue with CCP, however we still import a lot of electronics and semiconductors from there.
If rumors are to be believed, TSMC will scuttle their fabs before they fall into Chinese hands. Even if they don't, or fail to execute, Taiwan-based chip production will be disrupted for years.
Bet you'll be happy that TSMC has fabs in the US, despite your understandable misgivings.
Credit where credit is due: Australia, UK, New Zealand and Canada are all doing their major parts in espionage on each other and everyone else as a service as part of Five Eyes.
As a European myself, I am pretty miffed that my fellow Europeans keep acting like we're not leading the charge when it comes to spying on each other.
Japan, Korea, Taiwan, and other countries even Philippines and Vietnam don't want to depend too much on China. A lot of island disputes and so on and so forth.
My guess right now is that China will never catch up because Europe, US, Australia, and many other developing countries will avoid depending on China critically. This doesn't mean 0% would buy from China but it'll never become a critical dependency.
The problem China is big enough to catch up just by it depending on itself + some cheap mass consumer market outlets to even further scale production.
Like they have 1408 Million people ~3times the US and their education system tries (at least of paper) to give everyone a chance to reach silence excellence iff (and only iff) they are noticeable above average (but also due to the form of their education system for people which certain kinds of approaches to thinking which is a major handicap they gave themself accidentally). Like either way with that population size, priority on catching up on chip production, willingness to steal science (through it's not like the US doesn't have a habit for that, too) it's just a matter of time until they have some truly genius people put into the right kind of position with the right kind of resources which will close the gap step by step.
There's all kinds of stuff like this in supply chains. Low profit, high barrier to entry critical items.
- https://www.ajinomoto.com/innovation/our_innovation/buildupf...
- https://www.ajinomoto.com/brands/aji-no-moto
'Most all of which falls square into your "low tech and low profit", from a right-thinking* American company's PoV.
Not to say that a saintly American company could do much better, if it tried to swim uphill against America's vastly-higher cost of living (vs. the countries where most of that stuff's manufactured). And other problems beyond its control.
*profit-obsessed, generally
Even if it was just motherboards in particular and not others, that seems like a necessary step in securing the supply chain and if we only do that for national defense the benefits of competition likely won't extend to consumers that are still exposed to trade taxation.
This almost sounds verbatim what U.S. Secretary of the Treasury Scott Bessent told Bloomberg yesterday, so take the headline phrase “worth it” in that context.
Another interesting point:
> AMD and larger rival Nvidia Corp. recently gained a reprieve on restrictions imposed on shipments of some types of artificial intelligence accelerators to China. It’s still not clear how many licenses will be granted — or how long the companies will be allowed to ship the chips to the country, the biggest market for semiconductors.
It sounds like they’re trying to give China some chips but not as many as American allied countries. I wonder if they’re trying to get China “addicted” to western AI chips to hurt Chinese chip manufacturing development?
It’s wild the same administrations would argue for restricting access to the US market for tariffs to strengthen domestic production, would not believe that severely restricting exports to the Chinese market would strengthen their domestic production
This has nothing to do with that. It was part of the deal made with China recently in Geneva. The U.S. needs what China has (rare metals), and China needs what the U.S. has (SOTA chips).
There - that's a little more accurate.