PC makers: Intel CPU shortages are here to stay ... for six months As Intel battles to get on top of CPU shortages that have plagued its business in recent times, the world's largest computer makers are hunkering down for six months of tight supply. A surge in Windows 10 PC refreshes, demand from cloud infrastructure builders and Apple, coupled with struggles to produce 10nm silicon has …
Ahh I remember when I had by mistake vastly overstocked on 1mb sticks which for me at the time was about 500 of them at about £5 each.
I spent a day trying to pass some on as I didn't like to stock more than about a hundred, but got no where.
That night the Kobi earthquake happened and over the next week or so prices rose to about £100 each before I sold.
I was in two minds about whether I should profit from it but in the end sense and the prospect of a nice holiday prevailed.
The issue is that Intel's 10nm fab doesn't work. So they are still making CPUs on their 14nm fab when they should have already moved them to 10nm, but they have moved chipset manufacturing to be on the 14nm fab AND they have a contract with Apple to supply them with modems manufactured at 14nm. So there is lots of stuff that needs to be manufactured on 14nm and limited capacity to do so.
Also to compete with AMD's 32 core server CPUs Intel have increased production of their 28 core CPUs. But unlike AMD's EPYC CPUs which contain 4 separate dies linked together, Intel's Xeons use a single large monolithic die which means they can only get a few CPUs out of a single wafer and there is a higher chance of a fatal defect occurring in the die.
Given that the shortage started right about the time they would have needed to ramp up production of modems for Apple, I think that's the culprit. Back when Intel and Apple made these plans - probably a couple of years ago - Intel believed they'd have 10nm up and running by now.
Interesting that the shortage is supposed to last six months. Does that mean Intel will be getting additional capacity online, or that as iPhone sales have their usual cyclic drop in spring/summer they won't need as many modems? Assuming Apple uses Intel modems again next fall, this could again be an issue if Intel is still having problems making their 10nm process work. They claim they will have 10nm systems on shelves in time for the 2019 holidays, but that's pretty nonspecific. Having 1000 such systems would qualify, but wouldn't help any 14nm shortage.
They have to prioritize modems if they have a contract with Apple requiring delivery of a certain number of modems at a certain time. And there is a 100% chance there is such a contract, because there's no way Apple would agree to go exclusive with Intel modems if they had to bear the risk that Intel might decide "sorry we decided we'd rather make x86 CPUs than modems, guess you'll have to tell customers to wait months for delivery of their iPhones"
Since Intel thought they'd have 10nm up and running when this contract would have been negotiated a couple years ago, they never imagined it would end up causing a shortage of x86 CPUs.
Prima facie, there does not appear to be any shortage of iPhones (particular SKUs like Max 512GB might have order delays, but not all models) so obviously they are getting all the modems they need from Intel. The nearly 100 million modems Intel will have shipped to Apple by the end of the year is using up a LOT of 14nm fab capacity.
"So tomatoes are in short supply this year, because I say they are, now give me twice as much for them."
Broadly speaking - yes, that's how supply and demand works.
In reality, as the price increases, demand decreases as some people make do with cucumber sandwiches because they were hungry rather than having tomato sandwiches because they preferred them.
Continuing the broken fruit/vegetable metaphor, Intel is likely only providing it's most profitable tomatos, leaving the more budget conscious sandwich eater to try ARM or AMD cucumbers or to continue eating bread until something tastier is available at a more appropriate price.
As has been stated publicly by numerous sources over the past year, Intel is in trouble primarily because they can't deliver fully working 10Nm node. Add this to their full line of security compromised CPUs delivered over the past three decades and it's obvious why Intel is in trouble. Intel's intent is to leave the chip market and move to a service based Biz model but their transition is not going well.
We have a new cluster at work for just over six months and had two possibly three (I loose count) CPU failures now and this is Skylake Xeon Gold 6138's which is only 14nm stuff. These are genuine verified CPU errors, try pinning a program to run on one of the CPU's in the system (they are dual socket servers) and it exits with errors. Replace the CPU and it's fine. In my previous 25 years in IT support I have known have had exactly one CPU failure.
6 months of tight supply? Big deal. Motherboard manufacturers (and everyone else) is really feeling the tight supply in ceramic caps, especially MLCCs in big packages. Leadtimes are running out over 52 weeks with the supply chain telling us to brace for the tightness to last into 2020.
Last time I saw anything like this was Tantalum caps back before the dot com bust. Not sure how this one will play out, but I'm betting that the tight supply will get tighter as everyone tries to secure the inventory they need (or think they need). That will get compounded by brokers looking to profit from a tight market. Mix in some sting from shady suppliers hawking counterfeit parts. Then at some point we'll get a cooling of the economy just as capacity comes back on line, and boom, glut of caps on the market.
the tag line made me laugh, so ICON for that
we had to 'upgrade' a bunch of dumb / thin clients to get them to 64MB each, there were around 150 units, the RAM was 'just' a pile of 32MB stickes to do a straight plug in, and due to the cost, the memory was delived by Securicor ..................................
and anyone else recall THOSE days when the Battle of Britain game was released, and the comics went into meltdown, because it NEEDED 128MB of RAM to play it .................... WHO is going to spend THAT sort of money just to play a game, was one such strapline IIRC :o)
That's because they need the capacity now.
Look at it this way. Do you think that the Amazons, Googles, Facebooks of this world will sit back and say "Nah - the CPUs have a really funky little flaw. We simply can't expand operations until <undefined date> when that's fixed."
Companies in particular need them now, or their competitors will take them and move ahead.
"With Nvidia delivering their new cards with only minimum gain at eye-watering prices"
I suspect this is deliberate - the 12nm Nvidia products are largely targetted at AI/ML/HPC that benefit from the increases already while gaming GPU's will benefit more from the decrease in process node allowing higher clock speeds.
"issues with 7nm lithography"
Are there? Any references? Intel have issues with their 10nm process, but I believe 7nm processes for TSMC/Samsung are already providing working products for low power nodes (FF/FF+ for smaller CPU's) and TSMC will provide HPC node for larger items such as GPU's/larger CPU's by the end of 2018 with full production volumes available in Q1 2018.
"if I was in buying shares I'd rush to invest in AMD"
AMD benefit from Intels losses and anything that pushes up average prices, but they don't have their own 7nm fabs, so AMD may not benefit as much as you expect in the next 6 months. It will heavily depend on when Intel can release sub 14nm products.
Intel needs to be less sidetracked by chasing the process node leadership white elephant and be more focused on how to be a chip design leader. The signs are pointing the basic Skylake uarch since 2015 is still gonna hold the fort till 2020, and AMD getting a *mere* 10% IPC increase on Zen 2 is gonna torpedo Intel left, right and center even on a lesser but much cheaper process node.
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