News US sanctions transform China into legacy chip production juggernaut — production jumped 40% in Q1 2024

[Admin]

China's legacy chip production has skyrocketed since U.S. export sanctions took effect. In Q1 2024, China's legacy chip production was three times what it was in Q1 2019.

US sanctions transform China into legacy chip production juggernaut — production jumped 40% in Q1 2024 : Read more

 

[punkncat]

Demand drives production as well as innovation. Sort of a no brainer.

 

[ohio_buckeye]

Not only that but what a move. One can imagine a lot of your electronics in everything from cars to mp3 players likely are using these legacy chips. So basically allowing a monopoly to be created it sounds like.

 

[thestryker]

Not only that but what a move. One can imagine a lot of your electronics in everything from cars to mp3 players likely are using these legacy chips. So basically allowing a monopoly to be created it sounds like.

This has been the natural progression of peak fabrication because they all wind down old nodes. In the case of Intel they were historically pretty aggressive with this so I don't think they have any 200mm fabs left (this was a driving force behind them wanting to buy Tower). It's not possible for a company to spin up a new old node fab so it's left to existing or government subsidized and we can guess which this is.

 

[ivan_vy]

USA prohibits cutting edge chips, China mass produce legacy chips and flood the world markets.
*surprised pikachu face
basic economy of scale and the revenue will fund R&D including eventually proper lithography tools.
one might think lawmakers don't know enough about economy and technology.

 

[Pierce2623]

Demand drives production as well as innovation. Sort of a no brainer.

It seems you missed the part of the article where they’ve overproduced and went beyond demand. China doesn’t do innovation. They just do IP theft.

 

[punkncat]

They just do IP theft.

I sure won't fault you for that part of the statement.

 

[Pierce2623]

USA prohibits cutting edge chips, China mass produce legacy chips and flood the world markets.
*surprised pikachu face
basic economy of scale and the revenue will fund R&D including eventually proper lithography tools.
one might think lawmakers don't know enough about economy and technology.

If China started a program today to build a 3nm node. It would take 10 years at least if they’re trying to build their own lithography tools, too( which they’ll seemingly have to do to hit 3nm)

 

[williamcll]

It seems you missed the part of the article where they’ve overproduced and went beyond demand.

Overproduction is a lie by bigger chip producers to gauge and inflate prices. There's always a demand

 

[daris98]

People always underestimate the market scale of "legacy chips". TSMC has 32% of its money coming from the planar transistor business (28 nm or older) and considering the skyrocketing demands they had as the market leader on cutting edge nodes, that number is absolutely massive.

However, as time goes by, the gap between legacy and cutting edge might either be more and more prominent or will diminish. Critical computing infrastructure, especially ones that needs brute forcing (AI for instance) is expected to see a divergence, but we never know if that's ever true as someone might come up with a workaround by using less transistors (though apparently unlikely). If true, we're not even sure if it's an ever growing trend either.

On the other hand, budget consumer electronics can stay at the 7 nm generation in a long time. Any computer with the 16 nm generation process is still deemed fast these days, in comparison to say what 32 nm was to 90 nm (e.g. Sandy Bridge vs Prescott). The world should always be ready for China's slippery industrial strategies.

 

[gg83]

If not mature nodes, China would have put that money and more into bleeding edge. Either way China would have taken a percentage of global production. This isn't worth an article. It's just an anti-sanction pro China propaganda peice.

 

[digitalgriffin]

More power to them.

 

[ivan_vy]

If China started a program today to build a 3nm node. It would take 10 years at least if they’re trying to build their own lithography tools, too( which they’ll seemingly have to do to hit 3nm)

doesn't matter, the knowledge gained will be massive and will make them immune to newer sanctions. the sanction-happy-boogeyman will be over for them.

 

[ivan_vy]

People always underestimate the market scale of "legacy chips". TSMC has 32% of its money coming from the planar transistor business (28 nm or older) and considering the skyrocketing demands they had as the market leader on cutting edge nodes, that number is absolutely massive.

However, as time goes by, the gap between legacy and cutting edge might either be more and more prominent or will diminish. Critical computing infrastructure, especially ones that needs brute forcing (AI for instance) is expected to see a divergence, but we never know if that's ever true as someone might come up with a workaround by using less transistors (though apparently unlikely). If true, we're not even sure if it's an ever growing trend either.

On the other hand, budget consumer electronics can stay at the 7 nm generation in a long time. Any computer with the 16 nm generation process is still deemed fast these days, in comparison to say what 32 nm was to 90 nm (e.g. Sandy Bridge vs Prescott). The world should always be ready for China's slippery industrial strategies.

we don't need 2nm on an smart fridge, millions of cheap and mid range android phones make iPhone C models irrelevant. not everyone need halo products and industrial consumers take up to decades to update their systems, China tech industry will be ready.
Also people forget software keeps evolving, see how many Pi projects can do almost anything on relative modest hardware.

 

[gg83]

we don't need 2nm on an smart fridge, millions of cheap and mid range android phones make iPhone C models irrelevant. not everyone need halo products and industrial consumers take up to decades to update their systems, China tech industry will be ready.
Also people forget software keeps evolving, see how many Pi projects can do almost anything on relative modest hardware.

Near zero profit margins. I'm sure half the Chinese chip fab operate at a loss.

 

[digitalgriffin]

we don't need 2nm on an smart fridge, millions of cheap and mid range android phones make iPhone C models irrelevant. not everyone need halo products and industrial consumers take up to decades to update their systems, China tech industry will be ready.
Also people forget software keeps evolving, see how many Pi projects can do almost anything on relative modest hardware.

What's your point? There are tons of fabs that can make this tech outside China also. More power to them if they become self sufficient.

 

[digitalgriffin]

Not only that but what a move. One can imagine a lot of your electronics in everything from cars to mp3 players likely are using these legacy chips. So basically allowing a monopoly to be created it sounds like.

Hardly a monopoly. There are TONS of fabs that produce legacy nodes. The ONLY way they can achieve monopoly is to be gov't subsidized as legacy chips eventually become more expensive to produce then new nodes due to mature die shrink. And if that happens, dumping taxes will be applied, negating any benefit. (Which kind of started this whole trade war...It started with steel)

 

[daris98]

we don't need 2nm on an smart fridge, millions of cheap and mid range android phones make iPhone C models irrelevant. not everyone need halo products and industrial consumers take up to decades to update their systems, China tech industry will be ready.
Also people forget software keeps evolving, see how many Pi projects can do almost anything on relative modest hardware.

I don't know if you agree with me or not, but I feel like you and your good friend are pushing an agenda. I am not interested in any of yours - I am only pointing out the mere facts that some here are oblivious.

It's not a question of how successful will China be, because none of your mentions can even remotely close to answer that question.

 

[COLGeek]

Folks, as a friendly reminder, please leave the political banter for other sites. In addition, courtesy and civility towards others is required for all.

It is okay to disagree. It is not okay to act disagreeable.

 

[ivan_vy]

Near zero profit margins. I'm sure half the Chinese chip fab operate at a loss.

that's we see tens of new start-up appears every week and tens dying, many for the incentive money, yet some of them will survive even if the government has to foot the bill, CHIPS Act do the same

 

[ivan_vy]

What's your point? There are tons of fabs that can make this tech outside China also. More power to them if they become self sufficient.

integration is the key, cheap electronics (from ridiculous polystation consoles to high end phones) will not disrupt production if any sanction strikes, that's my point, they can make (or soon will be able) complete products from mp3 players to electric cars.

 

[ivan_vy]

I don't know if you agree with me or not, but I feel like you and your good friend are pushing an agenda. I am not interested in any of yours - I am only pointing out the mere facts that some here are oblivious.

It's not a question of how successful will China be, because none of your mentions can even remotely close to answer that question.

I don't get your point and have no idea about what agenda you are talking about, my posture is that sanctions are backfiring because economy was misunderstood by lawmakers, China can access Africa, Asia an LatAm markets, look at phone sales and is obvious cutting edge is not the sales leader in volume.
There is no need to take part in the 'with us or against us' narrative, that posture negates achievements and mistakes of both sides.

 

[JTWrenn]

Given this idea I hope there is talk in Japan about limiting China's access to the new Canon chip printing tools. These would be perfect for the legacy chips China is pumping out and could cause an even bigger splash....if they work that is.

Seems like litho tech is going to be the big issue here. Will China come out soon with their own or are they still quite a ways away from it? Seems like trying to hack ASML and hire away experts would be very high on their list right now.

 

[ohio_buckeye]

Biggest thing from my viewpoint, if I’m in government in the USA, sanctions I get why. But the other side of that, the USA needs to be pushing hard to get things from chips to any raw material you need being produced in the USA. At least some level. If there would ever be a conflict, you have to be able to produce what is needed at home otherwise you are likely to lose. Case in point, Germany in ww2. They had tanks and some equipment arguably superior to the allies. However the USA had such a manufacturing base that they could out produce the other side to the point that for every tank the Germans could field, you maybe had 3 from the allies and eventually overwhelmed them with sheer numbers.

But also you need capacity for everything from tech to manufacturing and food supplies otherwise you set yourself up failure. I know I’ve told my wife I’ve played enough strategy video games lol.

Not to say anything against anyone in particular, but it just seems in general this is a prudent idea and what I’d want to push for if I were someone in authority.

 

[NinoPino]

(e.g. Sandy Bridge vs Prescott)....

Not the best example.😀