back to article Chip glut might start in 2023, says IDC, and auto-chip traffic jam could clear this year

Analyst firm IDC says the global semiconductor industry is showing signs of "potential for overcapacity in 2023 as larger scale capacity expansions begin to come online towards the end of 2022". A brief note on the industry's prospects states: "dedicated foundries have been allocated for the rest of the year [2021], with …

  1. Richard 12 Silver badge

    Rip and replace

    How much of that 5G silicon is replacing already working Huawei 5G silicon by gubbermunt dictat?

    Such e-waste.

    1. Kristian Walsh

      Re: Rip and replace

      Very little.

      IDC’s figures are global, and thus include 5G network equipment from all manufacturers, including Huawei - the replacement of that vendor’s equipment at some operators in one market is not really significant globally. But in any case, the vast majority of 5G silicon will be used in handsets, not infrastructure.

    2. elsergiovolador Silver badge

      Re: Rip and replace

      How much of that 5G silicon is replacing already working Huawei 5G silicon by gubbermunt dictat?

      It should have not been manufactured in the first place and then it shouldn't have been ordered.

      Company that produces hardware that can't be used is essentially producing e-waste.

      1. WonkoTheSane
        FAIL

        Re: Rip and replace

        I still say that the whole "Huawei BAD!" thing was a Qualcomm lobbyist who got access to the former guy for 5 minutes.

        1. elsergiovolador Silver badge

          Re: Rip and replace

          That's irrelevant even if true. We simply shouldn't give vital infrastructure into communist controlled organisations.

          1. Yet Another Anonymous coward Silver badge

            Re: Rip and replace

            Or facist ones.

            Or religious ones.

        2. EveryTime

          Re: Rip and replace

          The Huawei issue started well before the TFG. Trump went all-in on it, but it wasn't just his administration.

    3. DS999 Silver badge

      Re: Rip and replace

      Who says the Huawei stuff that's replaced will be thrown in the trash? If it wouldn't have otherwise been replaced then it is still fit for purpose, and can be resold and used in a country that doesn't have any Huawei ban.

      I imagine carriers in less wealthy nations would love to get their hands on some discount equipment and have probably been reaching out to major US, UK, etc. carriers already.

      1. Yet Another Anonymous coward Silver badge

        Re: Rip and replace

        Depends. The stuff being banned is carrier grade, backbone stuff. So if you are a telco in a non-aligned country, having a bunch of misc mismatched gear with no support/maintenance from Huawei might not be such a great deal.

        1. doublelayer Silver badge

          Re: Rip and replace

          I'd imagine that the companies who originally bought it had those contracts, and if they're not transferable, they're negotiating that as well. If Huawei is to lose another customer for ongoing support payments, they could be receptive to having that customer find them new telcos to pay for that support and become loyal Huawei customers in future.

          1. Yet Another Anonymous coward Silver badge

            Re: Rip and replace

            Yes but Huawei want $3RD_WORLD_COUNTRY to sign some sort of large deal involving ongoing support and maintenance and a "friendly regulatory environment" - they aren't going to support a Telco who bought a bunch of banned kit on ebay.

            Not only are they losing the sticker price, but they want the ban to be as expensive as possible, to be most politically difficult to the countries doing the banning.

            1. doublelayer Silver badge

              Re: Rip and replace

              I'm sure they would like that, but if a telco buys some banned equipment because it's cheaper than buying everything directly from them, then they still might want to support that country in order to get repeat business as that equipment becomes broken or obsolete. If they're only open to all-or-nothing deals, they have competition who might have a package that could be more convincing, but the other competitors are unlikely to compete with equipment sold at a low price by places who just want to get rid of it.

  2. glococo

    "... and opportunity cost in mature process technologies..."

    Nice words to say "speculation".

    Why is It is perfectly understandable in chips, but not in real state ?

    1. elsergiovolador Silver badge

      Why is it perfectly understood for gig tickets? Why these laws cannot be applied to chips and real estate...

  3. Korev Silver badge
    Coat

    Thanks for the Intel, IDC

  4. elsergiovolador Silver badge

    Bleak

    For some MCUs suppliers start to show availability dates beyond 2027 now and it was 2022 just months ago.

    1. Charlie Clark Silver badge

      Re: Bleak

      That's just the inventory system's way of saying mañana – not now. The supply chain is still broken but it's now more a question hiccups as opposed to out and out failures, for which the just-in-time mentality of the car industry is mainly to blame.

      The bigger problem is that the car industry now wants more, more powerful silicon at the same time as world and his dog does, but new capacity is coming on line and older fabs will be retooled.

      1. This post has been deleted by its author

  5. EveryTime

    I'm observing considerable pent-up demand. I expect that it will result in full fab utilization through the end of 2022.

    It's easy to predict the when inelastic and bounded demand will be sated. Automotive is a good example. Shortages stop production. Surpluses, no matter how excessive, don't expand production.

    Another type of demand is out there. People that can't buy their next game console. Gamers that stuck with their old GPU, or bought low-memory GPUs. Students that bought crappy Chromebooks because they needed something for remote school, but better machines were sold out. Work-at-home types with a budget for laptop and screen upgrades.

    1. Def Silver badge
      Joke

      Don't forget about all those people wanting to upgrade their PCs for Windows 11.

      Oh wait.... Never mind.

      1. Kristian Walsh

        Windows upgrades haven’t needed faster hardware since about 2009. Same goes for Apple, to a lesser extent, although Apple does like to periodically obsolete its platforms... a cynic would say it was to drum up sales. What really kills personal computer performance these days is the relentless march of JavaScript, which is why so much effort is being put into single-thread performance these days.

        The next big spur for PC upgrades is more likely to be Intel’s Alder Lake asymmetric-core CPUs, launching next month. This design is the first big leap in real performance since AMD’s high core-count Zen CPUs, and Alder Lake will also launch with the first mainstream CPU chipset to support DDR5 memory. Thing is, Alder Lake needs a new OS to properly take advantage of scheduling tasks on the small/large cores. Right now that OS is Windows 11; Linux support for these chips is also well under way, but it looks to be unlikely to have full support in place before the new year. (Intel appears to have been pretty good at supporting the kernel developers, but there really aren’t that many developers, and it’s a lot of work)

        1. Def Silver badge

          All true, but right now Windows 11 requires a TPM 2.0 module and a seventh generation or newer Intel processor (or similar AMD processor).

          And that discounts a rather large segment of the installed Windows 10 base from qualifying for an upgrade.

          That also doesn't take into account the fact that my original comment was a joke. :p

    2. Richard 12 Silver badge

      A lot of businesses too

      Many (most?) businesses will have stretched their normal replacement cycle because of the pandemic, and supply shortages.

      Those machines and server components still need replacing, so they'll be trying to swap out an extra 10-20% machines in the next couple of years than they normally would.

POST COMMENT House rules

Not a member of The Register? Create a new account here.

  • Enter your comment

  • Add an icon

Anonymous cowards cannot choose their icon

Other stories you might like