Two startups tried to catch up to makers of advanced computer chips, and failed

Economical and performant chip and jet turbine production are two areas where China can't really take any shortcuts. They have to put in a lot of time and resources to rediscover closely guarded secrets that are almost impossible to reverse engineer. They are dumping in the resources, so I'm sure they will eventually get there, but it might be a few decades (in both fields, they can already do performant or economical, just not both at the same time).

Re: Two startups tried to catch up to makers of advanced computer chips, and failed

#5

Post by spamizbad » Mon, Jan 10, 2022, 10:31 PM UTC

Not surprised: $2.3B is chump change in semiconductor manufacturing especially if you're starting from scratch. Double that, add a zero, and wait 5-7 more years.

Re: Two startups tried to catch up to makers of advanced computer chips, and failed

#6

Post by vmception » Mon, Jan 10, 2022, 10:35 PM UTC

I have met so many people that think their semiconductor manufacturing needs are exempt from the supply chain issue or backlog.

Typically they all say "We are using this other nanometer size, and so thats not where the backlog is"

is there any truth to that statement?

Re: Two startups tried to catch up to makers of advanced computer chips, and failed

#7

Post by bsedlm » Mon, Jan 10, 2022, 10:37 PM UTC

seanmcdirmid wrote: post #4

Economical and performant chip and jet turbine production are two areas where China can't really take any shortcuts. They have to put in a lot of time and resources to rediscover closely guarded secrets that are almost impossible to reverse engineer. They are dumping in the resources, so I'm sure they will eventually get there, but it might be a few decades (in both fields, they can already do performant or economica…

> They have to put in a lot of time and resources to rediscover closely guarded secrets that are almost impossible to reverse engineer

yes, they have to repeat all that work, they have to solve all those solved problems again because companies that solved the problems won't share their solutions.

Re: Two startups tried to catch up to makers of advanced computer chips, and failed

#8

Post by bvaldivielso » Mon, Jan 10, 2022, 10:44 PM UTC

seanmcdirmid wrote: post #4

Economical and performant chip and jet turbine production are two areas where China can't really take any shortcuts. They have to put in a lot of time and resources to rediscover closely guarded secrets that are almost impossible to reverse engineer. They are dumping in the resources, so I'm sure they will eventually get there, but it might be a few decades (in both fields, they can already do performant or economica…

Interesting. What about hiring people from the leading companies? Isn't that how a lot of knowledge transfer happens in all industries? Are non-competes enforceable internationally?

Re: Two startups tried to catch up to makers of advanced computer chips, and failed

#9

Post by jeffreyrogers » Mon, Jan 10, 2022, 10:45 PM UTC

bsedlm wrote: post #7

seanmcdirmid wrote: post #4

Economical and performant chip and jet turbine production are two areas where China can't really take any shortcuts. They have to put in a lot of time and resources to rediscover closely guarded secrets that are almost impossible to reverse engineer. They are dumping in the resources, so I'm sure they will eventually get there, but it might be a few decades (in both fields, they can already do performant or economica…

> They have to put in a lot of time and resources to rediscover closely guarded secrets that are almost impossible to reverse engineer yes, they have to repeat all that work, they have to solve all those solved problems again because companies that solved the problems won't share their solutions.

Why would a company share its trade secrets? It's one of the few differentiators left to most companies. Not to mention the national security arguments.

Re: Two startups tried to catch up to makers of advanced computer chips, and failed

#10

Post by nwiswell » Mon, Jan 10, 2022, 10:45 PM UTC

vmception wrote: post #6

I have met so many people that think their semiconductor manufacturing needs are exempt from the supply chain issue or backlog. Typically they all say "We are using this other nanometer size, and so thats not where the backlog is" is there any truth to that statement?

Yes.

The "size" you are talking about is the "process node". It's basically a shorthand for how large the transistors are. These nodes are not fungible, once a chip is designed and a mask set is taped out it must be fabricated on that specific process node. Even if you have a chip designed on an older/larger node, it cannot be fabricated on a newer/smaller node without significant expense and delay.

Older nodes are generally in lower demand, although strictly speaking they are a tighter supply bottleneck, since nobody is incentivized to build fabs at older process nodes.

But the picture is even more complicated than this. Virtually all semiconductor fabs specialize in certain kinds of chips. Even at roughly the same process node, a DRAM fab cannot easily retool to make NAND, a NAND fab cannot easily retool to make logic (CPU, GPU, FPGA...), a logic fab cannot easily retool to make MEMS or image sensors, and so on.

In fact, not only are individual fabs tooled to make particular kinds of chips, but individual fab operators will generally have their own "design rules" at a certain node. So suppose that you have an ASIC you've been making at TSMC 22nm; just because GlobalFoundries has capacity at 22nm doesn't necessarily mean you can just have them start making your chips.