#books [[chris miller]] backlinks: [[Semiconductor Investment strategies]] [[semiconductor|semiconductors (technical)]] ## Types of [[semiconductor]]s Difference between: memory chips, processor (logic) chips, silicon wafers? Three categories of chips: - memory chips: - [[DRAM]] chips short term memory for computers (also called [[NAND]]) - Key players: [[Samsung]], [[Micron]], [[SK Hynix]] - [[Logic]]: processors than run smartphones computer and servers - - Function: Process data and execute instructions - Examples: [[CPU]], [[GPU]], [[FPGAs]]s - Key players: Intel, AMD, NVIDIA, Apple - diffuse category: - analog chips: sensors that convert visual or audio signals into digital data - [[Texas Instruments]], [[Analog Devices]], [[Infineon]] - radiofrequency chips that communicate with cell phone networks a - [[semiconductor]] that mage how devices use [[electricity]] -> especially 1+2 manage how devices use electrify #### Why exactly is is to shard to produce semiconductors? | Challenge | Explanation | | ------------------------------ | --------------------------------------------------------------------------------------------- | | **Nanometer Precision** * | Manufacturing requires extreme precision at the atomic level (sub-10nm). | | **Complex Supply Chain** | Multiple materials ([[silicon]], rare metals) sourced globally, needing perfect coordination. | | **Advanced Technology** | Cutting-edge equipment like EUV lithography is rare, expensive, and complex. | | **Cleanroom Environment** | Fabrication requires ultra-clean environments to prevent contamination. | | **[[Capital]] Intensive** | Building and maintaining fabs costs billions, making R&D expensive. | | **Rapid Technological Change** | Constant innovation needed to keep up with [[Moores law]]and market demands. | | **Global Political Factors** | Geopolitical tensions can disrupt the supply of critical materials or components. | | **[[Yield]] Optimization** | Minimizing defects on wafers is difficult, requiring highly optimized processes. | | | | *10 nanometers (nm) is extremely small (!). To put it in perspective: - **1 nanometer (nm)** is ==one-billionth of a meter== (1 nm = 0.000000001 meters). - **10 nm** is about 10 times the diameter of a single water molecule. - It's roughly ==**10,000 times smaller** than the width of a human hair.== - A typical virus (like the [[Influenzavirus]]) is about 100 nm in size, meaning 10 nm is one-tenth of that. ## Geopolitics and production around the world mainly: - [[Korea]] in memory chips [[DRAM]] and [[NAND]] - [[Samsung]], [[sk hynx]] - japan: materials and equipment for manufactoring e.g. [[silicon wafers]]: - [[shin-etsu]] - taiwan: leader in [[semiconductor]] manufacturing: - [[TSMC]] - USA: - chip design [[Fabless Design]] - [[intel]], [[NVIDIA]], [[Qualcomm]], [[Lam Research]] - [[netherlands]]: basically monopoly in [[euv litography|Extreme ultraviolet lithography]] - [[ASML]] - [[China]]: domestic [[manufacturing]] - [[SMIC]], [[Huawei]] - Problems: - **Tech Sanctions**: U.S. restrictions limit access to advanced tools (e.g., [[euv litography]] ), slowing down progress. - **Advanced Node Gap**: China lags behind Taiwan, Korea, and the U.S. in advanced semiconductor technology (7nm and below). ![[image 27.jpg]] ![[IMG_5144.png]] ##### Semiconductor sales worldwide from 2015 to 2023, by region ![[Pasted image 20241002130133.png]] #### [[China]] ![[Pasted image 20241002130255.png]] #### [[europe]] ![[Pasted image 20241002130316.png]] ## ## China and [[USA]] ![[image 28.jpg]] - [[made in China 2025]]: reduce share of foreign chips used in [[China]] - [[Biden]] clocked any us company to sell chips to China (software, equipment, desing) - USA subsidies [[TSMC]] to build companies in the us - USA forced Taiwan to cut off chip deal with China - As it got released that China used American chips to build their [[Military]] -> US and China are fighting a war #### USA - [[CHIPS Act]] US allocated 53 billion • $39 billion for manufacturing incentives (to build new fabs or semiconductor plants in the U.S.). • $13.7 billion for research and development, workforce training, and other related programs. ## [[taiwan]], [[TSMC]] and the US: How does TSMC stand out? Why did the US let Taiwan have such a great influence in the semiconductor industry? | **Topic** | **Key Points** | | -------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | **Why TSMC Stands Out** | - **Fabless/foundry model**: TSMC pioneered the fabless manufacturing model, allowing it to focus solely on manufacturing, while U.S. firms focused on design and manufacturing. <br> - **Specialization**: Focused exclusively on advanced manufacturing, helping it become the leader in cutting-edge [[nodes]] (7nm, 5nm, 3nm). <br> - **Government support**: Taiwan’s government provided strong financial backing, tax breaks, and educational investment to foster semiconductor growth. <br> - **Global customer base**: TSMC built strong relationships with global tech companies like Apple, Nvidia, and Qualcomm, becoming the go-to manufacturer. | | **Why the U.S. Didn't Take Countermeasures** | - **Globalization and outsourcing**: U.S. companies followed the trend of outsourcing manufacturing to reduce costs, assuming they could dominate in design and IP, leaving manufacturing to cheaper markets like Taiwan and South Korea. <br> - **Focus on design and IP**: U.S. companies shifted focus toward chip design rather than advanced manufacturing. <br> - **Lack of strategic foresight**: Policymakers underestimated how critical advanced semiconductor manufacturing would be for national security and tech dominance. <br> - **Delayed government intervention**: The U.S. government didn’t take semiconductor manufacturing seriously until recent years, with measures like the CHIPS Act only coming in response to the global chip shortage and geopolitical tensions. | | **Recent U.S. Countermeasures** | - [[CHIPS Act]] (2022)**: Allocates $52 billion to incentivize domestic semiconductor manufacturing to rebuild capacity and reduce reliance on foreign manufacturers. <br> - **Export controls**: Restricting access to advanced U.S. chip technologies for countries like China. | #### what makes TSMC stand out? | **Point** | **Summary** | | -------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | **Industry-Leading Technology** | TSMC was the first to commercialize advanced nodes like 7nm and 5nm, critical for devices like smartphones and AI processors. Its upcoming 3nm node is expected to offer even better performance and energy efficiency. | | **Advanced Lithography Techniques** | TSMC pioneered the use of [[euv litography\|Extreme ultraviolet lithography]] (EUV), allowing for more precise patterning of chip features. EUV is crucial for producing smaller nodes like 5nm and 3nm with greater accuracy and efficiency. | | **Yield and Manufacturing Efficiency** | TSMC is known for its high yield rates, meaning a large percentage of its chips meet performance specs. Its reliability and efficient production make it the preferred partner for major tech companies like Apple, [[NVIDIA]], and [[Qualcomm]]. | #### Nodes in [[semiconductor]]? Think of a semiconductor chip like a city. The “nodes” are like the width of the streets. If your streets (nodes) are wide (large), you can fit fewer buildings (transistors) in a given area. As you make the streets narrower (smaller nodes), you can pack more buildings into the same space, increasing the city’s population density (chip performance) and reducing the distance people (electricity) need to travel, making everything more efficient. ![[Pasted image 20241002125838.png]] #### What is lithography and eu-litography? [[litography]]: print patters on silicon wafers to make semiconductors [[euv litography]]: uses wavelength of only 13.5 nm → allowing to create shorter and more precise features on chips | Technology | Wavelength | Analogy | Precision | Example Application | | ----------------------- | ---------- | ---------------------------------------- | --------------------- | ------------------------------------------ | | Traditional Lithography | 193 nm | Like drawing with a thick marker | Larger, less detailed | Older chips (e.g., basic laptops) | | EUV Lithography | 13.5 nm | Like using an ultra-fine pen for details | Ultra-fine, precise | Cutting-edge smartphones, advanced [[CPU]] | ![[Pasted image 20241002125211.png]] ## Future | **Crux** | **Details** | | ------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | **Continued Demand for Smaller Nodes** | Demand for smaller, advanced chips will grow, driven by AI, 5G, and autonomous vehicles. TSMC will push towards 2nm and beyond, but challenges in cost and complexity remain. | | **Rise of Competitors** | - **Samsung**: Expanding aggressively in advanced nodes like 3nm.<br> - **Intel**: Reinvesting in foundry services to compete with TSMC.<br> - **China's SMIC**: Lagging but gaining government support. | | **Geopolitical Risks and Supply Chain Diversification** | Taiwan’s geopolitical vulnerability will drive countries like the U.S. and Europe to diversify supply chains, invest in domestic production, and reduce dependency on Taiwan. | | **Technological Breakthroughs** | Companies will explore new post-silicon technologies (quantum computing, photonics, 3D packaging), which could open the door for new leaders in the semiconductor industry. | | **Environmental and Resource Constraints** | The semiconductor industry's growing resource needs will force companies to adopt more sustainable practices, creating competition in environmentally responsible manufacturing. |