Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Applied Materials Is a Major Reason Computers Keep Getting Faster

wsj.com

Post reply on HN
Print view View original

21–29 of 29 posts

Re: Applied Materials Is a Major Reason Computers Keep Getting Faster

#21

Post by hnfong »

imtringued wrote: post #19
hnfong wrote: post #16

Earlier quoted context omitted.

As I see it, it's not so much the fault of research institutions and hardware companies that salaries are not competitive with software. It's that the software industry has too much money. The economies of scale of the software industry allows excess central bank printed money to flow predominantly towards software companies and VC backed mega startups. You can be speculative in software startups with the standard VC…

>. The economies of scale of the software industry allows excess central bank printed money to flow predominantly towards software companies and VC backed mega startups. I don't know why people keep saying this. The central bank doesn't do this. It doesn't hand over money to investors. I don't like saying it but this sounds too much like a conspiracy theory to me. I mean, the pathway for why exactly this is supposed…

> I don't know why people keep saying this.

Does it occur to you that maybe people keep saying this because that's the truth?

I think it suffices to say that at least for the COVID round in the US, the "money printing" was in the form of the Fed buying US treasuries and the US government paying out trillions of dollars to normal people in the form of COVID stimulus checks. Yes, a significant part of it directly went to normal people, and it wasn't in the form of commercial banks lending money out.

You're advised to look at the Fed balance sheet, covid stimulus checks, the market cap of big tech, and the flow of speculative money (VC capital [or startup valuations], BTC, GME, etc.), especially with respect to the dates and timings.

If you think you learned everything you need to know about economics from some 10+ year old textbook, let me give you an update: in the US there's no "fractional reserve banking" system any more, unless the "fraction" is zero. Basically it's QE all the way now. ( https://www.federalreserve.gov/monetarypolicy/reservereq.htm )

Re: Applied Materials Is a Major Reason Computers Keep Getting Faster

#22

Post by alephnerd »

hnfong wrote: post #16
raziel2701 wrote: post #4

When I finished my phd in materials science I interviewed and got an offer at applied for $120k/yr in 2019. No thanks. Throughout my time in grad school I saw leaders in the semiconductor industry talk to professors and complain about how they can no longer get the best talent and that every one is going to software. Well, have you looked at what you're paying and what you're asking to get for that money? And then th…

As I see it, it's not so much the fault of research institutions and hardware companies that salaries are not competitive with software. It's that the software industry has too much money. The economies of scale of the software industry allows excess central bank printed money to flow predominantly towards software companies and VC backed mega startups. You can be speculative in software startups with the standard VC…

> The economies of scale of the software industry allows excess central bank printed money to flow predominantly towards software companies and VC backed mega startups

This is not why.

It's because of profit margins.

The Income per Employee at Applied Materials is ~$190-200k in FY24, but was traditionally around $60-100k in the 2010s [0]

The Income per Employee at Google is ~$390-428K in FY24. In the 2010s it was around $200-350k. [1]

Both AMAT and GOOG are blue chips in their categories, yet a software driven company like GOOG has more money to spread to employees simply because the margins are much higher than in Hardware companies.

A company like AMAT needs to invest massively in lab space, commodities, manufacturing space, real estate, and machinery, which takes a massive dent out of your margins. Most spending in tech on the other hand can go directly to employees and marketing, as the only major cost outlay is compute, which itself is increasingly being offloaded to cloud providers at companies this size because F1000s can get sweetheart deals with competitive pricing (cheaper than DCs) because they are strategic enough accounts.

The only Hardware companies that can succeed in this kind of market tend to be Taiwanese, Korean, and Japanese because the conversion rates are EXTREMELY competitive. A company like TSMC, TEL, Canon, etc can earn in dollars but pay Asian market rate salaries in Yen/NTD/Won. With salaries at those companies being around $40-70k in Taiwan/SK/Japan, this means you are able to almost double your net income simply by having lower employee salaries. On top of that, all those Japanese, Korean, and Taiwanese companies got govt support and backing, which wasn't vogue in the US until recently. Btw, the low salaries in TW/SK/JP were a major reason engineers from there defected to PRC companies, who gladly payed US market rate salaries with 0% income tax, given mansions, companies cars, etc.

Also, VC doesn't invest in public markets - that's an Investment Banking function. VC only prioritizes Software and Pharmaceticals because of the profit margins issue above. Now that the CHIPS act was passed, over the next few years we'll see better health for the Hardware industry within the US because now they have support that is comparable to what the Pharma industry (a similarly expensive industry from a cost outlay perspective) gets.

[0] - https://csimarket.com/stocks/AMAT-Income-per-Employee.html

[1] - https://csimarket.com/stocks/GOOG-Income-per-Employee.html

Re: Applied Materials Is a Major Reason Computers Keep Getting Faster

#23

Post by gretyuph »

ThrowawayTestr wrote: post #15
highwaylights wrote: post #12

Earlier quoted context omitted.

I'm a bit confused by this. The video was posted to YouTube in 2021. It looks like a video shot in 2021. It has a copyright notice at the end that states 2021. Yet it's talking about a then-current 193nm wavelength lithography, which according to this post from ASML's newsroom was the then-current process for producing 100nm chips at the end of 2000: https://www.asml.com/en/news/press-releases/2000/asml-announ... Acc…

193nm is the wavelength of the light used. The single digit nm fugue you're probably familiar with is the size of the features on the chip.

Isn’t the transistor size on the “3 nm” node around 30 nm?

Re: Applied Materials Is a Major Reason Computers Keep Getting Faster

#24

Post by whatisthiseven »

hnfong wrote: post #21
imtringued wrote: post #19

Earlier quoted context omitted.

>. The economies of scale of the software industry allows excess central bank printed money to flow predominantly towards software companies and VC backed mega startups. I don't know why people keep saying this. The central bank doesn't do this. It doesn't hand over money to investors. I don't like saying it but this sounds too much like a conspiracy theory to me. I mean, the pathway for why exactly this is supposed…

> I don't know why people keep saying this. Does it occur to you that maybe people keep saying this because that's the truth? I think it suffices to say that at least for the COVID round in the US, the "money printing" was in the form of the Fed buying US treasuries and the US government paying out trillions of dollars to normal people in the form of COVID stimulus checks. Yes, a significant part of it directly went…

Software salaries have been higher than hardware salaries since well before covid. So that part of your theory is bunk.

Had it occurred to you some people repeat stuff because they just want other people to believe the things they think? That's kind of how discussion works. It isn't a measure of truth to see the same line repeated at all. That's a fallacy.

Re: Applied Materials Is a Major Reason Computers Keep Getting Faster

#25

Post by sgarland »

raziel2701 wrote: post #4

When I finished my phd in materials science I interviewed and got an offer at applied for $120k/yr in 2019. No thanks. Throughout my time in grad school I saw leaders in the semiconductor industry talk to professors and complain about how they can no longer get the best talent and that every one is going to software. Well, have you looked at what you're paying and what you're asking to get for that money? And then th…

Anecdotally, when I worked at Samsung Austin Semiconductor (2017-2019), the top PhD engineers were paid lavishly. I don't know exact numbers, but I was told well north of $200K, plus hefty bonuses. Since mid-level engineers without a PhD could comfortably be in the mid-100s, that sounds about right to me. My guess is they wouldn't offer the $200K+ range to start, though.

I definitely don't blame anyone for not wanting to go there. Hell, that's where I pivoted into tech - I was a Shift Supervisor, realized I had no appetite for management and didn't want to be a technician, so I got a M.S. in SWE from UT Austin and then jumped ship. Instant salary boost, even though I had to start over on the career rung. Software does in fact pay massively well.

Re: Applied Materials Is a Major Reason Computers Keep Getting Faster

#26

Post by [deleted] »

alephnerd wrote: post #22
hnfong wrote: post #16

Earlier quoted context omitted.

As I see it, it's not so much the fault of research institutions and hardware companies that salaries are not competitive with software. It's that the software industry has too much money. The economies of scale of the software industry allows excess central bank printed money to flow predominantly towards software companies and VC backed mega startups. You can be speculative in software startups with the standard VC…

> The economies of scale of the software industry allows excess central bank printed money to flow predominantly towards software companies and VC backed mega startups This is not why. It's because of profit margins. The Income per Employee at Applied Materials is ~$190-200k in FY24, but was traditionally around $60-100k in the 2010s [0] The Income per Employee at Google is ~$390-428K in FY24. In the 2010s it was aro…

[deleted]

Re: Applied Materials Is a Major Reason Computers Keep Getting Faster

#27

Post by hnfong »

whatisthiseven wrote: post #24
hnfong wrote: post #21

Earlier quoted context omitted.

> I don't know why people keep saying this. Does it occur to you that maybe people keep saying this because that's the truth? I think it suffices to say that at least for the COVID round in the US, the "money printing" was in the form of the Fed buying US treasuries and the US government paying out trillions of dollars to normal people in the form of COVID stimulus checks. Yes, a significant part of it directly went…

Software salaries have been higher than hardware salaries since well before covid. So that part of your theory is bunk. Had it occurred to you some people repeat stuff because they just want other people to believe the things they think? That's kind of how discussion works. It isn't a measure of truth to see the same line repeated at all. That's a fallacy.

The COVID part I was replying to GGP's claim that the central bank doesn't print money.

Generally QE has started since 2008.

> Had it occurred to you some people repeat stuff because they just want other people to believe the things they think?

Yes, that's a possibility, not a definite. Why did you think that hasn't occurred to me? I'm not the one saying "I don't know why people keep saying this."

I specifically offered an explanation that involves the GGP possibly being wrong: "Does it occur to you that maybe people keep saying this because that's the truth?" Note the "maybe". It's not rhetoric. I meant what I wrote.

Of course there are other explanations but I'm pretty sure their view on what central banks are wrong or at least out of date. And I explained and gave pointers. I still wrote the "maybe".

Anyway, given your definite claim that people just repeat stuff because they just want other people to think the same, I guess discussion with you becomes meaningless at this point.

Finally I'll just note that quoting my counter example to explain what central banks do as evidence that I got my original claims wrong isn't really a argument either way.

Have a nice day.

Re: Applied Materials Is a Major Reason Computers Keep Getting Faster

#28

Post by hnfong »

alephnerd wrote: post #22
hnfong wrote: post #16

Earlier quoted context omitted.

As I see it, it's not so much the fault of research institutions and hardware companies that salaries are not competitive with software. It's that the software industry has too much money. The economies of scale of the software industry allows excess central bank printed money to flow predominantly towards software companies and VC backed mega startups. You can be speculative in software startups with the standard VC…

> The economies of scale of the software industry allows excess central bank printed money to flow predominantly towards software companies and VC backed mega startups This is not why. It's because of profit margins. The Income per Employee at Applied Materials is ~$190-200k in FY24, but was traditionally around $60-100k in the 2010s [0] The Income per Employee at Google is ~$390-428K in FY24. In the 2010s it was aro…

Yes, I totally agree with basically everything you said except the VC point (which, I don't think I implied VC invested in public markets).

Thanks for elaborating my point.

Post reply on HN