Re-examining the chip Shortage: Legacy node decommissions | Hacker News Reader

Re-examining the chip Shortage: Legacy node decommissions

trossbach.substack.com

12 pointsjontrossbach12 comments

Production systems based on ownership and monopolistic exclusion of knowledge are "anti-resilient". i.e. the opposite of "anti-fragile". They start off strong, because having exclusive ownership over knowledge is a capital subsidy. Then they weaken: less competitive firms are knocked out of competition, and because they own the knowledge behind their work, the work is lost as well. By the end of this process you have one or two surviving companies that own everything and can make their own problems the market's problems.

Very well said.

Sounds reasonable. Much like the "Baby Formula Shortage" which the media is still confused on, too.

This came through yesterday: "Samsung to cut chip production as profits plunge" https://www.theguardian.com/technology/2023/apr/07/samsung-t...

Yeah, my understanding from trying to follow this as closely as possible is that there are three different supply-chain problems all happening at once, getting conflated by journalist who don't have the expertise to report on the shortage correctly.

Sub-7nm chips appear to have had a genuine shortage from demand shocks during Covid.

EVs seem to be having a supply or demand shock for some reason.

And legacy node lithography chips (~250nm) were decommissioned and chip suppliers like autochip makers have been left scrambling to retrofit their designs to newer ~140nm-node tech.

Seems clear foundries have not been transparent with the public prior to the CHIPS Act.

Do you think the three part distinction made in The Chip War still basically makes sense?

> By the 2000s, it was common to split the semiconductor industry into three categories. “Logic” refers to the processors that run smartphones, computers, and servers. “Memory” refers to DRAM, which provides the short-term memory com puters need to operate, and flash, also called NAND, which remembers data over time. The third category of chips is more diffuse, including analog chips like sensors that convert visual or audio signals into digital data, radio frequency chips that communicate with cell phone networks, and semiconductors that manage how devices use e lectricity.

There are many automotive chips not made by TSMC. TSMC makes advanced chips and leaves legacy chips to companies like Infineon, TI, STMicro.

I discussed one particular scenario that had nothing to do with TSMC here:

https://news.ycombinator.com/item?id=34395424

Could you clarify what you think is happening?

To my knowledge Infineon, TI and STMicro are all technically "fabless". The term "fabless" is also misleading because "Fabless" actually means Foundry-less. This is part of the problem with reporters on this topic, they actually don't know that these companies don't have foundries and endorsed a "Fabless" business model long ago.

And the idea that a fire at a single fabrication site (not a foundry) caused this long of a chip shortage is not a likely scenario. Any explanation for the ongoing microchip shortage that has to do with fabrication sites and not foundries is likely a flawed understanding.

TI is most definitely not fabless; it is 80% in house. https://www.electronicdesign.com/technologies/analog/article...

Maybe on a slow day. But I would wager 80 percent of those orders are not made in house when they are at high demand, which is what matters in this context. When they have a ton of orders they are most likely contracting most of them to TSMC.

Infineon, TI and ST all own and operate fabs all over the world.

Fabless means you design chips, but you don't have your own fab (fabrication facitlity). TSMC is a foundry and and fabs chips for fabless companies like NVIDIA and Xilinx.

It's explained in detail in my linked comment.

That linked comment sounds a bit confused. Infineon, TI, and ST do not have lithography machine capacity to make all chips on their own at scale. However it is possible they do package their chips into components at their own Fabs.

This Bloomberg article might help clarify your understanding. https://www.bloomberg.com/news/articles/2023-01-12/tsmc-chie...

Legacy lithography machines appear to have been decommissioned setting off a domino effect across the legacy node chip industry.

Reply on news.ycombinator.com