Why the chip shortage drags on and on... and on:
The semiconductor industry lives at the cutting edge of technological progress. So why can't it churn out enough chips to keep the world moving?
Nearly two years into pandemic-caused disruptions, a severe shortage of computer chips—the components at the heart of smartphones, laptops, and innumerable other products—continues to affect manufacturers across the global economy.
Automakers have been forced to halt production in recent months as sales decline because they can't make enough cars. The shortage has affected industries from game consoles and networking gear to medical devices. In October, Apple blamed chip scarcity for crimping its financial results, and Intel warned that the drought will likely stretch to 2023.
In short, the semiconductor supply chain has become stretched in new ways that are deeply rooted and difficult to resolve. Demand is ballooning faster than chipmakers can respond, especially for basic-yet-widespread components that are subject to the kind of big variations in demand that make investments risky.
"It is utterly amazing that it's taken so long for the supply chain to rebound after the global economy came to a halt during Covid," says Brian Matas, vice president of market research at IC Insights, an analyst firm that tracks the semiconductor industry.
For one thing, the sheer scale of demand has been surprising. In 2020, as Covid began upending business as usual, the chip industry was already expecting an upswing. Worldwide chip sales fell 12 percent in 2019, according to the Semiconductor Industry Association. But in December 2019, the group predicted that global sales would grow 5.9 percent in 2020 and 6.3 percent in 2021.
In fact, the latest figures show that sales grew 29.7 percent between August 2020 and August 2021. Demand is being driven by technologies like cloud computing and 5G, along with growing use of chips in all manner of products, from cars to home appliances.
At the same time, US-imposed sanctions on Chinese companies like Huawei, a leading manufacturer of smartphones and networking gear, prompted some Chinese firms to begin hoarding as much supply as possible.
(Score: -1, Offtopic) by Anonymous Coward on Monday November 15 2021, @01:03AM
and I feel fine.
(Score: 5, Touché) by Anonymous Coward on Monday November 15 2021, @01:23AM (2 children)
How many chips are wasted on that?
(Score: 0) by Anonymous Coward on Tuesday November 16 2021, @02:39AM (1 child)
Isn't the whole point of blockchain technology to add an artificial delay to transactions to prevent the double spend attack?
Can't there be a better way to do this without requiring so much processing power?
If someone (with public key PK1) (pre)receives bitcoin 523 from someone with PK2 (the person with PK2 announces that they sent the bitcoin to the entire network) can't the person with PK1 announce to the entire network that they (pre)received bitcoin 523 and wait five minutes for a response from like 80 percent of the network to confirm that PK2 owns bitcoin 523 and didn't already spend it to someone else (basically PK1 also forwards PK2's send request). Only after PK1 receives confirmation from the overwhelming majority of the network that bitcoin 523 hasn't already been spent and only after a minimum artificial delay of like 5 minutes does the transaction become finalized and gets added to the blockchain and is considered valid. That way no one can double spend as it takes the majority of the network to confirm the transaction in order to finalize it and get it added to the network.
Why all this processing just to add transaction delays? Can't you just make up transaction delays and use those delays to do what's necessary to confirm that double spending isn't happening?
Sure, this begs the question, where does the original cryptocurrencies come from (ie: mining requires processing power/work but it creates the original coins in exchange). But is all this mining/processing necessary just to move coins around without double spending?
(Score: 0) by Anonymous Coward on Tuesday November 16 2021, @08:11AM
(I guess the problem would be how do you prove that a thousand accounts aren't owned by the same person and how do you decentralize that proof? IP addresses? I guess this would have to be looked at.
Perhaps proof of processing power shouldn't be required for every transaction, only periodically. Is that how proof of stake works vs proof of work?).
(Score: 4, Insightful) by Anonymous Coward on Monday November 15 2021, @01:30AM (8 children)
"Automakers have been forced to halt production in recent months as sales decline because they can't make enough cars. "
[ wipes tear from eye ]
How utterly sad...time to kick in some tax help, as in tax credits and subsidies.
As if we need more cars with electronic shit in it.
How about go back to selling a basic car?
(Score: 0, Interesting) by Anonymous Coward on Monday November 15 2021, @01:33AM
Better yet, stop making gas cars.
Slows CO2 and saves as all from the big scrap heap coming as we switch to electric cars.
Which btw, is not going to do shit to reduce our climate future.
(Score: 2, Informative) by Anonymous Coward on Monday November 15 2021, @02:27AM (3 children)
> As if we need more cars with electronic shit in it.
The next round of e-shit:
https://www.motortrend.com/news/anti-drunk-driving-technology-mandated-infrastructure-bill/ [motortrend.com]
More details at the link.
Now I'm really going to take good care of my older car, just say no to things like this.
(Score: 5, Insightful) by captain normal on Monday November 15 2021, @03:06AM (2 children)
Or you could just not drive when drunk.
"It is easier to fool someone than it is to convince them that they have been fooled" Mark Twain
(Score: 4, Interesting) by Anonymous Coward on Monday November 15 2021, @03:16AM (1 child)
I drove drunk exactly once, in high school, on a little 125cc dirt bike that would only have hurt me if I crashed into anything. Which I didn't, made it home from that party OK, but never again.
That was over 40 years ago. I did drive a simulator (high quality arcade racing game) drunk and found out that I'd made the right decision--any little distraction and my driving in-game deteriorated badly after a couple of drinks.
So, basically I don't want the drunk-o-meter in my car because it's not needed, I don't want to pay for it, and I don't want to be inconvenienced when it decides to false alarm and not let me drive.
(Score: 0) by Anonymous Coward on Tuesday November 16 2021, @02:53PM
Inconvenience? This device will automatically order you and Uber and a tow truck, and inform law enforcement if you fail to comply. For your convenience.
(Score: 5, Interesting) by Immerman on Monday November 15 2021, @03:17AM (1 child)
Sadly, to run a gas vehicle remotely cleanly you pretty much need need computerization constantly fine-tuning the motor. And everything's become so complicated that there's a joke that under the hood a modern car is an emissions control system with an engine bolted on.
If you like basic cars though, there's some really cool electric stuff coming out of China. Ranging from some surprisingly adequate NEVs like the $930 Changli Nemeca whose quality for the price astounded Sandy Munroe during an examination, to comfortable enough highway drivers where heater and AC are major items on the feature list for well under $10k - some of which should be coming to the US and Europe in the next couple of years, in a safer and more expensive version.
Heck, let's get really basic: no government subsidies or tax breaks of any kind to any company selling products that use either DRM, or custom components that are unavailable or significantly more expensive to the consumer aftermarket than existing components with similar performance characteristics.
Make it hard to charge a premium for things that are only different for the sake of being different. But, come up with something genuinely new that offers a real advantage? There's nothing similar on the market and you can set the price... at least until a competitor manages to catch up and drive the average price down.
(Score: 2, Informative) by Anonymous Coward on Monday November 15 2021, @03:36AM
> under the hood a modern car is an emissions control system with an engine bolted on.
It's so good in some cases that, if you are driving in an area of high pollution, the latest cars actually reduce the overall levels (of certain defined pollutants). Running the bad air through the engine and catalyst improves it!
> really cool electric stuff coming out of China
Just be careful which of the 300+ Chinese electric car companies you buy from--most of them are about to fail or be bought-out. Or be prepared to make your own spare parts because once they fail, that will be the end of parts availability.
https://fortune.com/2021/09/13/china-electric-vehicle-ev-market-consolidation-byd-nio-xpeng/ [fortune.com] (September 13, 2021)
(Score: 2) by Opportunist on Monday November 15 2021, @08:26AM
What? Are you nuts, then the "owner" (I use the term loosely here) could fix it himself!
Think of our kickback-paying repair shops!
(Score: 3, Insightful) by fustakrakich on Monday November 15 2021, @02:14AM (7 children)
Gotta raise prices. There's no real "shortage". It's a devaluation of our currency, all of which is due to the ongoing Wall Street bailouts
La politica e i criminali sono la stessa cosa..
(Score: 1, Informative) by Anonymous Coward on Monday November 15 2021, @03:10AM (6 children)
Raising prices, even to100x as much, won't increase production. And it's not just chips. Labour shortages, plants being damaged by "natural" (climate) disasters, the changing nature of work and more workers insisting there's no returning to the office, backlos all along the supply chain, transport shortages, conversion of plants using lower-resolution lithography processes with lower margins to higher margin processes, causing shortages of what used to be dirt cheap components …
(Score: 1) by fustakrakich on Monday November 15 2021, @05:12AM (1 child)
You're just talking symptoms. Capacity was fine until a short while ago. They can pay more money to keep people at work. It's just another ripoff like the old gas shortages. The petrodollar is becoming the silicon dollar in the devaluation process. Next year Apple will be "worth" 3 trillion
La politica e i criminali sono la stessa cosa..
(Score: 1, Insightful) by Anonymous Coward on Monday November 15 2021, @06:16PM
everyone is Just In Time and/or LEAN optimized. different hiccups have bown those up. while your company was the only one using them, you had an objective competitive edge, but one that became way more dependent on externalities behaving nicely. as long as your suppliers were churning out things, you could rely on getting stuff on demand, because your suppliers had stuff sitting around... but then they started to drink the Kool aid and they started being more efficient about their inputs and outputs, too...
oh, and consolidation in various layers and markets has not helped, either, despite their promises to regulators at the time that the new megaSuper would magically bring to be.
(Score: 5, Insightful) by driverless on Monday November 15 2021, @10:45AM (3 children)
You also missed out the effect of US sanctions against China, which means every electronics manufacturer in China is buying up and hoarding as many components as they can in case they're next in the sanctions lottery. When you've got the world's largest consumer of electronic components engaging in sanction-threat-induced mass hoarding, no amount of fiddling with the supply chain is going to help much - with more supply they'll just hoard more. The fix is to stabilise the uncertainty around availability and thereby remove the need to hoard.
(Score: 2, Insightful) by fustakrakich on Monday November 15 2021, @05:57PM (2 children)
The financial industry will never accept your proposal. Those "sanctions" are just to manipulate the price also. We live in a crisis/chaos industrial complex, very profitable
La politica e i criminali sono la stessa cosa..
(Score: 0) by Anonymous Coward on Tuesday November 16 2021, @03:54AM
You say that like it's a good thing.
(Score: 0) by Anonymous Coward on Tuesday November 16 2021, @03:01PM
Not just in industry. Politics now is always "last chance" and "save America". It's all up to 11, so now 11 is the new 10. We need a 12.
(Score: 1, Insightful) by Anonymous Coward on Monday November 15 2021, @03:19AM (7 children)
When almost everyone went fabless, this was bound to happen.
(Score: 2, Insightful) by Anonymous Coward on Monday November 15 2021, @03:41AM (6 children)
Why?
To me, splitting IC design from the fab was just another step in specialization. There isn't much in common between designing/modeling/simulating logic (etc), and running a big clean room with ultra precision manufacturing--why should they be under the same management?
(Score: 1, Informative) by Anonymous Coward on Monday November 15 2021, @03:53AM
Your (chip designers) problem is not my (fab) emergency.
(Score: 3, Insightful) by ChrisMaple on Monday November 15 2021, @05:12AM (3 children)
A chip design company without a fab has almost no leverage for the creation of a specialized process.
(Score: 1, Insightful) by Anonymous Coward on Monday November 15 2021, @05:19AM (1 child)
True, but today's shortages are not in new-process chips pushing the tech envelope. Instead the shortages are previous generation chips...which were normally very low priced. That kind of little processor sits between the door switch and the power windows (auto down, etc) and remote outside mirrors.
While I'm no expert, I have the feeling that there are so many mature technologies to pick and choose from, that most fabless design companies are not constrained by the lack of yet another new process.
(Score: 2) by sgleysti on Monday November 15 2021, @05:42AM
There's also a shortage of power management ICs, some of which are made on older processes.
(Score: 0) by Anonymous Coward on Monday November 15 2021, @05:23AM
On the one hand that's true. On the other hand, it opens up other issues like what Intel was having trying to build fabs tip construct their own stuff.
(Score: 0) by Anonymous Coward on Monday November 15 2021, @07:37PM
Even though these fabs claim to be producing something on some specific process they all seem to have their own optimized process, cell libraries, and design rules.
As a result, moving your chip design from one fab to another is in no way a simple re-compile anymore. For purely digital circuits there is quite some tooling around to help you but analog (sub-)parts are still very much a manual design exercise. Loose your contract with a fab and you'll be looking at quite some effort in getting the design prepared for the next fab you may want to contact.
(Score: 2, Informative) by Anonymous Coward on Monday November 15 2021, @04:14PM (1 child)
The use of microchips is all about "agile" and "flexible" and "just in time". Meanwhile, the manufacture of microchips involves multi-billion dollar investments, multi-year lead times, and decades long planning cycles. Microchip shortages and surpluses are basically inevitable. And they happen all the time, just never this bad before.
(Score: 0) by Anonymous Coward on Tuesday November 16 2021, @03:10PM
Is John Galt involved somehow?
(Score: 0) by Anonymous Coward on Tuesday November 16 2021, @02:23PM
... and we follow