I’ve worked in this space. This is interesting because the legacy chips are similar to generic drugs under capitalism: nobody wants to produce them because they have near-zero profits. “Unfortunately,” many legacy chips are still essential building blocks to make higher-end ones work in any electronic system. It’s basically trivial for China to corner the market here. It would be a hilarious page in history if NATO couldn’t build weaponry using SOTA chips because they ran out of 555 timers that NATO countries refused to produce due to lackluster profits.
Indeed, and the reality is that older chips work just fine for most applications. The main advantage of newer chips is in lower heat and power consumption which primarily matters for mobile devices. SMIC just announced that they can already produce 7nm that Huawei announced they’re going to use, so it looks like China is able to produce small batches of high end domestic chips for this niche use case now.
I’ve worked in this space. This is interesting because the legacy chips are similar to generic drugs under capitalism: nobody wants to produce them because they have near-zero profits. “Unfortunately,” many legacy chips are still essential building blocks to make higher-end ones work in any electronic system. It’s basically trivial for China to corner the market here. It would be a hilarious page in history if NATO couldn’t build weaponry using SOTA chips because they ran out of 555 timers that NATO countries refused to produce due to lackluster profits.
Indeed, and the reality is that older chips work just fine for most applications. The main advantage of newer chips is in lower heat and power consumption which primarily matters for mobile devices. SMIC just announced that they can already produce 7nm that Huawei announced they’re going to use, so it looks like China is able to produce small batches of high end domestic chips for this niche use case now.