back to article China's 7nm chip surprise reveals more than Beijing might like

After decades trailing the rest of the world in leading-edge chip making, Chinese sand stamper Semiconductor Manufacturing International Corporation (SMIC) has quietly got into the 7nm business. That's a huge and unexpected leap. Has the West's embargo of the latest fab furniture failed? The news comes not from SMIC itself but …

  1. Zenubi

    Nice

    "an amazing, tottering pile of near-magic photon-wrangling audacity, a mélange of multiple overlapping mask exposures and complex production tricks"

    Nice!

    1. Someone Else Silver badge

      Re: Nice

      Beat me to it... but agreed.

      This is why I read El Reg (even if it is a bit much for a Monday...)

      1. Anonymous Coward
        Anonymous Coward

        Re: Nice

        Easy to do when someone else has taken all the risk away by showing it can be done.

        1. Alan Brown Silver badge

          Re: Nice

          One of the things about someone else having done it first is that you have a target

          Reinventing that wheel sometimes results in bettering it. First passes are seldom the best ones

        2. Tom 7

          Re: Nice

          Similar tricks have been implemented in chip design before. In the late 80s 5um lithography was producing sub um bipolar bases.

  2. Neil Barnes Silver badge

    It's also an ASIC crypto-miner, highly parallel, low complexity. A starter chip.

    And isn't this in a country which has banned crypto-mining?

    1. elsergiovolador Silver badge

      Re: It's also an ASIC crypto-miner, highly parallel, low complexity. A starter chip.

      They also banned drugs and yet they supply the world with all kinds of illegal drugs.

      1. Clausewitz4.0 Bronze badge
        Devil

        Re: It's also an ASIC crypto-miner, highly parallel, low complexity. A starter chip.

        China supplies the world with a lot of chemicals to produce whatever the buyer intends to.

        It is up to the buyer to produce illegal recreational drugs or life-saving drugs.

        1. SFC

          Re: It's also an ASIC crypto-miner, highly parallel, low complexity. A starter chip.

          And which "life-saving drugs" are produced with Carfentanil? Ahhh, that's right, there are exactly 0. China knows exactly what they're doing, and it isn't "supplying the world with chemicals to produce whatever the buyer intends to". They're supplying drugs they know will be used to kill the citizens of the country's they're shipping them to.

          1. ChoHag Silver badge
            Coat

            Re: It's also an ASIC crypto-miner, highly parallel, low complexity. A starter chip.

            *wipes a tear from his eye*

            We taught them well.

    2. pavel.petrman

      Re: It's also an ASIC crypto-miner, highly parallel, low complexity. A starter chip.

      The way these regimes work is that they monopolise whatever they need to control the population. Banning cryptomining among the general public means most probably monopolizing it to the state.

      And the state my not need it for internal use, I'm sure you understand what I mean.

      1. Yet Another Anonymous coward Silver badge

        Re: It's also an ASIC crypto-miner, highly parallel, low complexity. A starter chip.

        >Banning cryptomining among the general public means most probably monopolizing it to the state.

        My own government takes a very similar attitude to making currency

      2. gandalfcn Silver badge

        Re: It's also an ASIC crypto-miner, highly parallel, low complexity. A starter chip.

        " I'm sure you understand what I mean." Yes. Paranoia.

      3. MachDiamond Silver badge

        Re: It's also an ASIC crypto-miner, highly parallel, low complexity. A starter chip.

        "Banning cryptomining among the general public means most probably monopolizing it to the state."

        I have to guess that China doesn't want people mining crypto due to the extra pollution that will cause with how they are currently generating power. That doesn't mean that don't mind it being done in other countries and dragging down those power grids doing the same work that can be done by bits of paper a round bits of metal with no power when they might be making tangible products and creating wealth.

        If China eliminates physical cash, it won't be managed by an ad hoc assortment of people. They will design a system that's centrally controlled and has very powerful tracking. Every yuan spent will have its entire history available for examination. I expect that will prove to be a tool much more powerful than the proles really can comprehend.

  3. elsergiovolador Silver badge

    Ours

    Yes, laugh at China. But where are ours 7nm fabs? Or 14nm? Or 40nm? Or 90nm?

    Nowhere. We ensured that no innovation nor manufacturing can happen here out of our own greed.

    1. BlokeInTejas

      Re: Ours

      "Ours"???

      You mean in the UK?

      But the UK has been controlled by EU (and local) greenery for decades. Fabs are not only very expensive, they're not particularly green. And they require lots of customers.

      The EU is so far behind in 'high tech' they're spending billions of euros trying to attain "digital sovereignty". Going to be a very long slow expensive stern chase. Soon Europe (not American or Taiwanese fabs in Europe, but European-owned fabs) will be able to build stuff that the rest of the world was doing in 2005 or so. There are European semiconductor companies; NXP, ST and Infineon exist and build stuff. When they use their own fabs - NXP uses TSMC for their advanced stuff - it's not very state of the art (see the recent announcement about ST and Global Foundries building a fab near Grenoble).

      Nowt to do with greed. Much more to do with the dead hand of the EU. The EU is much more concerned with diversity, keeping people employed regardless of the merits of the company, keeping the dammed furriners out (especially Americans, because they're just too effective), reducing inequality - all nonsense that really gets in the way of high tech (or indeed any business).

      1. Charlie Clark Silver badge

        Re: Ours

        You mean the same EU is behind in "high tech" is the same one that produces the machines necessary for EUV?

        1. Anonymous Coward
          Anonymous Coward

          Re: Ours

          As the old saying (roughly) goes - the only way to guarantee getting rich in a goldrush, is to be the one selling shovels.

          It's fair to say the EU needs some investment in fab capacity, but not because it is short of technical expertise - purely for strategic supply purposes.

          1. Bill Michaelson

            Re: Ours

            Would ASML be the shovels in your analogy? Where is ASML?

            1. cyberdemon Silver badge
              Mushroom

              Re: Ours

              ASML was the victim of a few "unfortunate accidents" over the course of the last few years and I'm sure China had Absolutely Nothing To Do With It.

              • A mysterious fire destroyed the production line for their XUV lithography machines
              • A Chinese employee ran off with the designs their XUV lithography machines
              • The main source of purest-quality Neon required for manufacturing the lasers that go into these XUV machines was er, invaded.
              • Meanwhile there were several unexplained fires at many of their customers who were producing chips for the west.
              • And now, that other big ASML customer and the main source of Chips for the West also stands to be invaded..

              I am sure none of these things are related. (yeah, right) How many microcontrollers are needed to make one modern missile, I wonder?

              Oh yeah, and you can forget Western unity - the bot-farms and social network manipulation machines find it extremely easy to rig elections & referendums and create zealots to sow division and hatred in the west.

              1. MachDiamond Silver badge

                Re: Ours

                "How many microcontrollers are needed to make one modern missile, I wonder?"

                You can use vacuum tubes if you are clever enough, but a Z80 is more than adequate for the task.

            2. Anonymous Coward
              Anonymous Coward

              Re: Ours

              They make machines that make shovels?

        2. bpfh

          Re: Ours

          ASML has entered the chat laughing in Dutch…

        3. gandalfcn Silver badge

          Re: Ours

          Beware of lying Brexiters pushing lies about the EU/

        4. Wzrd1 Silver badge

          Re: Ours

          Yep, produce the production kit, leave the purchaser to swim in the nasty chemical brews from using that kit.

          Smart move, surprising given the recent idiocy of calling methane based fuel clean.

          1. Cliffwilliams44 Silver badge

            Re: Ours

            No more of an idiocy than calling CO2 a pollutant! Considering CO2 is a required molecule for life to exist on this planet!

            Burning Methane produces CO2 and that most dangerous chemical dihydrogen monoxide! Better known as Water!

            1. zuckzuckgo Silver badge

              Re: Ours

              > Considering CO2 is a required molecule for life to exist on this planet!

              Even to much of a good thing can kill you. CO2 is a toxin. Although its toxic effects has nothing to do with global warming.

              If you are trapped in a room with no fresh air supply you do not die from lack of oxygen, you die of CO2 poisoning. That is why space craft and submarines need CO2 scrubbers.

              1. John Sager

                Re: Ours

                It's a toxin to us in high concentrations, but not to plants & algae. And what's a toxic level? The atmosphere is about 400ppm at the moment. The partial pressure of it in your lungs makes it about 100 times that concentration.

                1. zuckzuckgo Silver badge

                  Re: Ours

                  The point was just because something is essential to life does not mean it is safe at any levels - the logic proposed in the prior post. Yes increasing CO2 in the atmosphere will kill people through global warming long before the toxic effect kicks in. Either way it is reasonable to consider it a pollutant whether higher CO2 levels harm us directly or indirectly.

                  1. Alan Brown Silver badge

                    Re: Ours

                    "Yes increasing CO2 in the atmosphere will kill people through global warming long before the toxic effect kicks in. "

                    If it passes ~800ppm then the oceans will become acidic enough for food chains to crash entirely and at the same time rain becomes acidic enough to kill most terrestrial vegetation

                    That's what happened at the end of the Permian Era. The result was atmospheric oxygen levels crashing from ~20% down to ~12%. This part played out in less than a decade once it hit the trigger level and stayed there for several hundred thousand years

            2. Zolko Silver badge
              Mushroom

              Re: Ours

              that most dangerous chemical dihydrogen monoxide

              you mean hydrogene-hydroxyde probably. Yeah, scary stuff

            3. GraXXoR

              Re: Ours

              Yet just 10cm of Dihydrogen Monoxide at the bottom of a bathtub is enough to incapacitate or even outright kill a lone infant human within 180 seconds.

              Just because something is essential doesn't mean it's essential at a particular concentration or location.

              (Street level Ozone, for instance).

      2. Anonymous Coward
        Anonymous Coward

        Re: Ours

        @BlokeInTejas

        You win the Unmitigated Bollocks of the Week Award. And it's only Monday.

        The reason the UK doesn't have a dog in the semiconductor fight is because the country is full of, and run by, arsehats without a clue about semiconductors.

        1. John Brown (no body) Silver badge

          Re: Ours

          Not forgetting that the UK was the arsehat government that tried to kickstart the electronics components industry by putting tariffs on component imports, but NOT on pre-populated circuit boards or completed devices so we ended up killing the electronics manufacturing industry. "We" didn't make the components so "we" could no longer build boards and devices because importing them cost too much and it was soooo much cheaper to buy in from Asia.

        2. gandalfcn Silver badge

          Re: Ours

          It did have ARM but the arsehats sold it to Nihon/

          Just as they sell anything worthwhile to the furriners they despise.

          1. codejunky Silver badge
            WTF?

            Re: Ours

            @gandalfcn

            "Just as they sell anything worthwhile to the furriners they despise."

            So they sold it to foreigners they despise? But you like furriners so wouldnt sell to them? I am sure that makes sense to someone.

            1. Kristian Walsh Silver badge

              Re: Ours

              The meaning of that original statement is very clear: all of the UK Conservative Party’s bleating about being the defenders of British industry, and all of their anti-foreigner rhetoric pales into insignificance when presented with the opportunity to earn quick cash (and pocket a personal payoff as a consultant after retirement).

              1. codejunky Silver badge

                Re: Ours

                @Kristian Walsh

                "all of the UK Conservative Party’s bleating about being the defenders of British industry, and all of their anti-foreigner rhetoric pales into insignificance when presented with the opportunity to earn quick cash"

                Cant hate them that much then?

          2. Anonymous Coward
            Anonymous Coward

            Re: Ours

            Arm isn't really a semiconductor manufacturer.

        3. SFC

          Re: Ours

          >because the country is full of, and run by, arsehats without a clue about semiconductors.

          I'd imagine the entire crew at ARM would beg to differ...

          https://en.wikipedia.org/wiki/Arm_(company)

        4. Triggerfish

          Re: Ours

          There should be some sort of 'shoehorn politics' award, where someone just finds some reason no matter how tenuous to bring up their own personal politics.

      3. elaar

        Re: Ours

        I'm not sure how the EU stopped the UK from having fabs, I can't find any information to suggest that. But I do know that the EU (UK) is at the forefront of Medical Research, Fusion projects, CERN to name just a few. So to suggest the EU is behind on "high tech" because it doesn't have sophisticated FABS is laughable.

        1. Yet Another Anonymous coward Silver badge

          Re: Ours

          >I'm not sure how the EU stopped the UK from having fabs

          By making all the chips use French nano-meters instead of proper British pico-furlongs

        2. gandalfcn Silver badge

          Re: Ours

          "I'm not sure how the EU stopped the UK from having fabs" It didn't, that is normal Brexiteer propaganda. They say it about everything when it suits.

        3. Anonymous Coward
          Anonymous Coward

          Re: Ours

          "I'm not sure how the EU stopped the UK from having fabs"

          Blame it on the French Inspecteurs du Travail. Must have been their fault. How else could the UK fail so abysmally at something ... ?

      4. Anonymous Coward
        Anonymous Coward

        Re: Ours

        The UK does have a couple of silicon fabs. As anyone who can use Google can find out.

        They've been around since the 80s... ...so I guess it actually has nothing to do with the EU?

        1. katrinab Silver badge

          Re: Ours

          There is one in Newport that can do 180nm, one in Greenock that can do 700nm, and three in Glenrothes that can do 1200nm / 800nm.

          1. Dr_N

            Re: Ours

            I much prefer the production from Glenfarclas.

          2. Yet Another Anonymous coward Silver badge

            Re: Ours

            >Glenrothes that can do 1200nm / 800nm.

            That's a skilled job, takes a steady hand to carve 1200nm chips

            1. gandalfcn Silver badge

              Re: Ours

              Mines a Laphroaig.

              1. zuckzuckgo Silver badge

                Re: Ours

                Laphroaig - essential to steady the hands for the 800nm process.

                1. MachDiamond Silver badge

                  Re: Ours

                  I'd like to see the Glenmorangie Burgundy wood finish put out again. It may not steady my hands, but it makes me not care one way or the other.

          3. John 62

            Power silicon

            https://news.sky.com/story/without-these-chips-we-are-in-big-trouble-and-britain-has-no-strategy-12656135

            apparently Newport is very, very good at power silicon for charger cables and power supplies, which doesn't need to be done at a tiny node

        2. gandalfcn Silver badge

          Re: Ours

          But, but, us Brexiteers iz always rite!

      5. Inkey
        Boffin

        Re: Ours

        Very much to do with greed ... offshore all fabrication and enviromental concerns for way less than home grown .... also making local fab and inovation a losing hand.... shareholders and silicon monopolies win. ... It's also apathetic and lazy

        Considering the talent and heratige that past larels were rested on... if greed had Not been a factor we would not be in the predicament now, european and western production would be a major commpetitor and probibly way more enviromentaly safer...

        1. veti Silver badge

          Re: Ours

          If greed had not been a factor we'd still be hand painting the walls of our caves. Greed has driven civilisation from the beginning.

          Granted, that would be quite environmentally sustainable.

          1. John Brown (no body) Silver badge

            Re: Ours

            Correct. On the other hand, capitalism as currently practised, especially in the US, tends towards monopolies, or at least monopolistic and cartel-like behaviours. Grow or die. Growth being at the expense of the competition, who either go bust, get subsumed, or switch to a different business. Growth happens by increasing economies of scale, reducing costs and increasing profit margins. Much of that happens by moving production to where the costs are lower, eg regulations, wages, lack of environmental protection etc. China offered all that and now the world is paying the price. Other countries are getting in the game now too. Race to the bottom with productions costs.

            1. Cliffwilliams44 Silver badge

              Re: Ours

              "Correct. On the other hand, capitalism as currently practised, especially in the US, tends towards monopolies, or at least monopolistic and cartel-like behaviours. "

              And this is created by who? Y'all like to lay this blame on the Right but it is the Left who continuously creates the conditions that favor corporatism and consolidation! It is the Left that wages a literal war on small business, regulating and taxing them out of existence. The whole 'Tax the rich, tax the corporate fat cats!" is all a big lie and the Left knows it! This taxes are easily passed on to customers or offset by lay-off in big corporations but they cannot be offset easily in SMBs.

              Labor laws like minimum wage laws (which only make some jobs illegal) push jobs overseas where these anti-work laws don't exist!

              1. John Brown (no body) Silver badge

                Re: Ours

                "Y'all like to lay this blame on the Right but it is the Left "

                Thanks for telling how I think. That pretty much negates everything you said, since it's all presupposed on me actually thinking what you think I think.

                FWIW, not only did I not specify "right" or "left", I blame both side equally for who regulation operates. Neither side have the balls to act until it's too late, as shown by history. If you want to partisan over the issue, that;s fine. But try looking at the "other" side once in a while too. Both sides have the occasional good idea, but on the whole, both are as bad as each other. Oh, and don't forget to watch out for self-projection.

                And FWIW, there is no "left" in the US. There;s only "right" and "more right". Y'All.

                1. Anonymous Coward
                  Pint

                  Re: Ours

                  'And FWIW, there is no "left" in the US. There;s only "right" and "more right". Y'All. '

                  The cousins keep losing sight of this.

            2. Alan Brown Silver badge

              Re: Ours

              "capitalism as currently practised, especially in the US"

              Isn't capitalism. It's mercantilism and corporatism

              It's worth learning the difference. Capitalism is a fragile beast that paradoxically if left to its own devices turns into a saturnian monster more than capable of devouring its own children. Constant nuturing and guidance is essential

          2. gandalfcn Silver badge

            Re: Ours

            If curiosity had not been a factor we'd still be hand painting the walls of our caves.

            The greed came later along with religions.

            1. This post has been deleted by its author

            2. Smeagolberg

              Re: Ours

              >The greed came later along with religions.

              Exploiters of religions introduced and used greed for their own ends and built themselves a hierarchy. Religions were simply the context. Followers were seduced into supporting 'leaders' because that way leads to paradise, as any fule kno.

              cf.

              Exploiters of capitalism introduced and used greed for their own ends and built themselves a hierarchy. Capitalism was simply the context. Followers are seduced into supporting 'leaders' because that way leads to paradise, as any fule kno.

              Capitalism is as heavily loaded with symbols, superstitions, a priesthood, creeds, rituals, the holy book, etc. (*) as religions were in medieval times.

              (*) Think... '£', '$', everlasting growth, fiat currency, economists, the FT, the WSJ, etc....

          3. Smeagolberg

            Re: Ours

            >If greed had not been a factor we'd still be hand painting the walls

            >of our caves. Greed has driven civilisation from the beginning.

            That says nothing about the drivers of civilisation and everything about your outlook on the world... of science, art, technology...

      6. Glen 1

        Re: Ours

        Ahhh, classic Brexiter.

        Never letting facts get in the way of a display of foaming bile.

        1. gandalfcn Silver badge

          Re: Ours

          Twas ever thus, and congratulations, you've upset one of them!

      7. gandalfcn Silver badge

        Re: Ours

        "But the UK has been controlled by EU (and local) greenery for decades." Did Lying Nige tell you thjat? Or the Victorian era prefect Greasy Moggy.

      8. Anonymous Coward
        Anonymous Coward

        Re: Ours

        While the EU is controlling greenery for decades, there *are* a few fabs left, for certain one in Nijmegen The Netherlands. So why not in the UK?

        It *was* greed why we pushed out the semi production out of Europe. Greedy managers invented the word 'off-shoring', and now they invented a new word 'on-shoring', or more worse 'friend shoring'. (The latter is about doing business with friended nations only. ) They should ge prosecuted.

        Greed is what kills innovation, nothing else.

        And about state of the art... Assume that you are installing an OS of 120G on your PC, then you need 7nm or 4nm mode. Is that state of the art? No, it is a pain in the butt ! It should be 120M, or even less. It can be 4M if you want, but then you must leave out all the crap that you don't need anyway ;-)

        Diversity is beautiful: It ensures that people solve problems in a creative way. I believe that code optimalisation is a forgotten process, certainly if you see all the mess around you, with the biggest example named Micro$oft... We are in deep deep sh*t here... Greed and stupidity has done this, nothing else.

      9. Smeagolberg

        Re: Ours

        >But the UK has been controlled by EU (and local) greenery for decades

        What a quaint idea.

        Did you got lost on the way to the Daily Mail site? Never mind, and thank you for bringing a smile to wiser faces on your way.

      10. Kristian Walsh Silver badge

        Re: Ours

        And yet American companies do build and operate state-of-the-art fabs in the EU. So, if the EU was trying to stop it, they’re going a funny way about it. Certainly, you don’t give a billion euro in grants to stop someone coming into your territory.

        Intel just kicked off two more CPU fabs in Italy and Germany, to go with the one it already has ready to go in Ireland. The UK didn’t make the shortlist for the new sites partly because of Brexit (you need a stable supply-chain for a semiconductor plant), and mostly because of the lack of skilled labour.

        That latter one is what has really crippled English industry (I say English, because education is devolved) - underinvestment in education, especially at secondary level, means it costs far more in training to hire a plant operative in England than it does in Germany, France, Italy or Ireland.

        Your strange assertion that “diversity” is incompatible with a meritocracy shows you’re not thinking things through. I’ve worked with and for enough white thick-shits who had rich parents to get them through college to know where the real problem is in hiring practices, and it’s not ethnic minorities.

    2. MachDiamond Silver badge

      Re: Ours

      "Yes, laugh at China. But where are ours 7nm fabs? Or 14nm? Or 40nm? Or 90nm?"

      Essentially banned in the US. The state department would call a process a "National Security" concern and any company that wanted to export products would need to apply for a waiver and have their customers cleared for purchase. If those same companies built the fabs in an accommodating asian country, they could export product to anybody they liked without a government review. It's still much like that. Many technologies several revs back are still on the ITAR list even though the cat has long since left the bag. In another decade, that stuff may finally be struck from the list, but we're talking about government speeds and people that don't know a transistor from a jelly bean.

  4. Anonymous Coward
    Anonymous Coward

    Impressive

    I visited SMIC many years ago, when they were a DRAM foundry. They have good Engineers. You have to imagine that if they're copying TSMC process, they are also trying to copy ASML lithography. It's hard to keep secrets for long

    1. Charlie Clark Silver badge

      Re: Impressive

      No one's doubting the competency of the engineers but the point is that EUV is fiendishly difficult to get right, which is why it took around 20 years. China certainly won't need 20 years to get it right but they're not getting it next week either.

      Then again, I'm not particularly convinced that the sanctions applied on China in the last few years will achieve much beyond encouraging the Chinese to develop their own capacity. The mistakes were made years ago when everyone moved factories to China because it was cheap.

      1. Cliffwilliams44 Silver badge

        Re: Impressive

        Of course it won't take them 20 years to achieve it! They will just steal it!

    2. Persona Silver badge

      Re: Impressive

      China was crippled under Mao and kept as a rural peasant economy. With nothing much to start with the fastest way to progress was for them to copy what others have and spend on education. Copying is near instant, but it takes a long time for the investment on education to pay back as first you need to teach the teachers. I believe there are now more than 3000 universities in China with 50 million pupils enrolled. Currently there are 22 Chinese universities ranked in the top 200 in the world. It's a given that they will be copying the ASML lithography. It's also quite possible that they are developing new and better stuff.

      1. Smeagolberg

        Re: Impressive

        >China was crippled under Mao and kept as a rural peasant economy.

        Don't give Jacob Grease-Smog ideas!

        1. John Smith 19 Gold badge
          Unhappy

          "Don't give Jacob Grease-Smog ideas!"

          People have struggled to find a suitable nickname for the Honourable Member for the 18th Century.

          I suggest keeping it simple

          Refer to him as "JR," like Larry Hagmans character in the series "Dallas".

          Devious, cold, cunning and likely to set fire to a tramp to toast some marshmallows.

    3. DS999 Silver badge

      Re: Impressive

      You have to imagine that if they're copying TSMC process, they are also trying to copy ASML lithography. It's hard to keep secrets for long

      It isn't copying it that will be hard, or at least wouldn't be hard if they were able to steal the blueprints for it or have their spies working inside a TSMC facility when ASML equipment is being installed so they can take pictures of everything.

      The difficulty would be in manufacturing all the parts it is made from, which are mostly bespoke parts that on their own required years of R&D to figure out how to make them to the unimaginably tight tolerances and harsh conditions they must manage.

      ASML's EUV scanners might be the most complex pieces of technology humanity has ever mass produced (i.e. not counting one offs like CERN's detectors) and ASML has a lot of suppliers for the parts used, and most of those suppliers have their own suppliers. So China/SMIC would have to steal blueprints, and manufacturing methodology, for all those as well.

      The road to EUV is orders of magnitude harder than the road to leveraging DUV to get to 7nm was, because they only had to have spies working inside TSMC to steal that knowledge. Though it may be possible for SMIC to use some of the same "photon wrangling audacity" to use ever higher layers of multipatterning and computational lithography to go beyond 7nm. The cost per chip will skyrocket due to needing many more steps and the awful yields, but while commercial offering of the node would be a no go it just has to work regardless of cost for it to be feasible for low volume military needs.

  5. b0llchit Silver badge

    Do not underestimate China

    The article is a bit negative on the achievement. The fact that they are "years behind" does not matter for all areas in the chip making business. Many, really many chips are on large nodes. They do not need the very fine features or process to work.

    What we see is a fast catch-up process. Get the bulk first and the details will come later. As said, they have infinite money to invest into self-sufficiency. Does it matter that it still takes years? No, it does not. Once they are there, they are unstoppable. And with China's top-ordered push to the top we will see it sooner than later. What we see here is just one step.

    1. I ain't Spartacus Gold badge

      Re: Do not underestimate China

      I'm less positive on China than many pundits. It's one thing to go from being a poor to a middle-income country, but there's only a handful that have made the leap into the being rich countries. And almost all of them have been democracies. Or have democratised (I'm sure that's a real, if horrible, word) over the process of going from middle-income to rich.

      In some ways, China is in a great place. It's got lots of money to play with and lots of people. And some very impressive technology. But the workforce is already starting to go into decline, and by 2030 its going to have the demographics of an Italy or Japan, without much of the wealth that those two nations have built up over the last century.

      Also they've gone from a corrupt elite that at least regularly renewed itself, to a single-ruler dictatorship. I think that will make a difference. As Putin has found, the downside of being dictator is that people get into positions of power by telling you what you want to hear. Which is nice and comforting, until you invade Ukraine on the advice of people that they've got a huge network of traitors who'll help you and that the people are just yearning for the otherthrow of their evil nazi government and to be liberated by the Russian army. You get that kind of self-delusion and groupthink in all systems - but democracies have the advantage that the leaders get changed, and the people who got to high positions by kissing their arses often change with them.

      Even in the non-democratic Chinese Communist Party they were changing half the Politburo every five years with the Prime Minister becoming big boss General Secretary and a new PM appointed. This allowed for changes of ideas and orthodoxy. And debate on the best policy for the new regime to take up - even though of course it's all still the same regime, the Communist Party are still running the show.

      Much harder for a dictator to change policy. That means admitting that they got it wrong. A terrible loss of face! Prestige is at stake. Which means you've got to wait 20 years for the next dictator to come along before fixing something. In the old Chinese system there was room for debate, and you could always quietly blame the cadre that were just about to retire for whatever policy you were changing.

      Look at China's zero Covid policy. It's increasingly failing to work and keeping it also allowed the government to get complacent on getting people vaccinated. They've got a lot of over 60s who've not been jabbed yet. But having crowed about how much better they are than the West and how great Xi's leadership is, it's going to be a big climbdown to change it - but an increasing cost to keep it.

      So while I'm sure China will have many successes, and invest some of its money in technology projects that work. It may also be stuck with those projects that don't work and wasting billions on them too, because it's too embarrassing to admit they haven't. While more of the country's precious investment capital goes into outdated heavy industry because it's a big employer of both workers (they don't dare risk mass unemployment) and Communist Party officials' sons and friends. Meanwhile the Chinese tech sector is denied access to that capital, because a lot of it is in private hands and so doesn't get special access to party-controlled regional banks and government cash.

      1. Anonymous Coward
        Anonymous Coward

        Re: Do not underestimate China

        China, under whichever political flavour is in favour, usually takes a much longer view than the capitalist West. Businesses in the west look for short-term profit; even democratic governments are rarely able to look beyond the next election. Big, government sponsored development projects usually focus on the short-term gains (such as being seen to invest, rather than what any long-term yield).

        The west used to have a longer view; for example, cathedrals that could take several generations to construct. Consider the stock market where resources are poured into the ability for ever faster trading: how can a market that looks for near instantaneous profit ever look at what future generations may need?

        China isn't looking for success now; sure, there need to be gains to manage the populations' expectations, but the real prize lies in the future of China, not the current population or group in power. Don't be fooled by changes in political flavour - the means may change but the objective doesn't.

      2. DS999 Silver badge

        China's demographics may be its biggest challenge

        China may be on a path to becoming another Japan in 15 or 20 years. The one child policy was great for curbing overpopulation, but parents who grew up as an only child are turning out to mostly not want more than one child themselves even though the one child policy was repealed some time ago because they saw the problem on the horizon.

        Like Japan, China is insular and does not encourage immigration or make it easy, so there isn't any way to import younger people from other countries in enough numbers to make up for low internal birth rates like the US and Europe do. Economic growth will stagnate and eventually decline as China's population ages and the working age population peaks and begins to shrink, and the ratio of pensioners vs working age worsens. Which is exactly what happened to Japan, though for them the low birthrate was a choice rather than a mandate.

        1. John Brown (no body) Silver badge

          Re: China's demographics may be its biggest challenge

          On the other hand, how can we know how China might deal with an ageing, retiring population? Will it be as costly per head for them as, say in Europe?

          1. gandalfcn Silver badge

            Re: China's demographics may be its biggest challenge

            Yes. But as they have mostly retained traditional family values it will be less of a burden on the state.

          2. Smeagolberg

            Re: China's demographics may be its biggest challenge

            >On the other hand, how can we know how China might deal with an ageing, retiring population?

            Logan's Run?

            1. Anonymous Coward
              Anonymous Coward

              Re: China's demographics may be its biggest challenge

              Several comments above, someone pointed out that there were over 60's in China who had not had Covid vaccinations.

              Coincidence?

        2. MachDiamond Silver badge

          Re: China's demographics may be its biggest challenge

          "but parents who grew up as an only child are turning out to mostly not want more than one child themselves"

          As people cram into already massively overdense cities, having more than one child would mean needing more housing than they could afford. In China's rural areas, the one-child policy was waived as having kids on the farm made for cheap labor and they had the room. Maybe people in Japan's largest cities are foregoing children or only having one for many of the same reasons.

          The world population is already overshot and with more automation there are less people needed for production jobs to maintain the same level of consumerism. Those "blue collar" jobs are the backbone of the middle class. Not everybody can code or work in design jobs. Many more people can work on an assembly line or drive a delivery truck so as those sorts of jobs go away, the smaller the middle class will have to get.

      3. martinusher Silver badge

        Re: Do not underestimate China

        You're making the mistake of comparing apples and oranges. We made progress in technology in the west by a combination of readily available capital, access to talent and liberal amounts of government funding (through the DoD) to prime the pump. This has nothing to do with democracy as we understand it, in fact democracy in the form of endless planning restrictions would most likely be a serious impediment to future large scale industrial development in some areas. The fact is that all these ingredients are present in modern China -- they've got the capital, the personnel and the backing of government -- and so expect the result to be similar.

        Its worth noting that both Taiwan and Korea (South) had seriously autocratic governments until recently -- dissent was not tolerated, even crushed. Compared to these countries modern China is a free wheeling 'winner take all' society more like the US than anywhere else. Sure, its not going to be exactly like us because, well, they're Chinese but you don't grow the kind of economy they have by the old Soviet command model. People in the west need to wake up and realize this and retire the old Cold War model that we've been brought up with. After all, the numbers tell all -- China's graduating north of 35,000 engineers a year.....that's got to have an impact (and yes, they're as well educated and as clever as we are -- that's another thing we've got to dump, this dumb colonialist mindset about the 'natives').

        1. Anonymous Coward
          Anonymous Coward

          Power of words.

          "Bureaucracy in the form of endless planning restrictions" is a better fit then democracy there. Being able to vote and having a relatively equal say in who runs your government isn't what makes the DMV terrible. Autocratic governments tend to lag on all fronts in the long run, as their self interest becomes the primary and often sole driver. While there is some case for saying big infrastructure projects are more likely under them, they aren't more likely to succeed, or be delivered any faster. They are more likely to fail due endemic corruption though. Bad when that is a dam.

          They are likely to try to convince you that your problems are caused by "officious democrats" instead of "officious bureaucrats" though. Mainly because the authoritarian's government is also lousy with them. Tends to happen once you can no longer vote them out. Also to be watch out for are the people who want you to vote for them so they can decide to ignore everyone and do whatever they wanted anyway, then claim you can't stop them because they were elected.

          We'd all do well to be careful which strangers we take ideas, candy and dictionaries from. They don't always have our best interests in mind.

          1. abstract

            Re: Power of words.

            And the US were overtaken because they were ideologically blinded. The Westerns want to believe they are superior. They did all they could for 2 centuries to let the rest of the world lagging behind. After, the fall of the colonial empires, the US took the lead to try and prevent the rest of the world from catching up. Thanks to the Western arrogance and their push for globalization (since they were the sole masters of the world), China took the opportunity and 2 decades to prove to the world that the so called Western supremacy was an illusion.

            The Western answer: no, but the Chinese, they steal... Sure!

          2. Cliffwilliams44 Silver badge

            Re: Power of words.

            China calls themselves Communist but in all reality they are a Fascist country. They operate more closely to National Socialism than to the traditional Italian/Spanish Fascism. This is even more evident now that Xi has become the de facto Dictator (leader). A strong singular leader, government support and control of corporations, highly nationalistic and anti-foreigner policies, these are all tenants of Fascist/National Socialist governments!

        2. gandalfcn Silver badge

          Re: Do not underestimate China

          Most "Westerners" are blissfully unaware of the things that China invented and that it went into decline because of the inertia of deistic imperialism, just like the UK did and the USA is now in the process of.

        3. MachDiamond Silver badge

          Re: Do not underestimate China

          "China's graduating north of 35,000 engineers a year.....that's got to have an impact (and yes, they're as well educated and as clever as we are -- that's another thing we've got to dump, this dumb colonialist mindset about the 'natives')."

          A goodly number of those are graduating from US universities. The University of California, Irvine (UCI) is nicknamed the "University of Chinese Immigrants" due to the large asian contingent of students. It's a well regarded uni and I expect that any course graded on a curve is going to be fierce if you can't keep up. Most of those students are going to return home bringing that top quality education with them.

      4. Hillman_Hunter

        Re: Do not underestimate China

        I Would Note that the west is flirting with autocracy ATM, although I agree with your evaluation of its consequences.the growing populist backlash, anti WOKE sentiment could lead into that Autocratic cul de sac you accurately describe. That said China do seem able to have maintained an advanced industrial economy and a well educated middle class.

        1. gandalfcn Silver badge

          Re: Do not underestimate China

          What I find amusing is that the majority those with an "anti WOKE sentiment" are practising, seriously devout Christians and therefore they are trying to destroy obviously Christian philosophies.

    2. Anonymous Coward
      Anonymous Coward

      Re: Do not underestimate China

      I recall, when many years ago whilst working in R&D for a well-known engineering company, our departmental manager reckoned our latest success put us 5-10 years ahead of the competition. That puzzled us minions, as we'd only spent six months on it - we just couldn't figure out why the competition couldn't spend six months and catch up, but management clearly knew better than us lowly engineers...

      1. Sam not the Viking Silver badge

        Re: Do not underestimate China

        When I started work we had a good, steady product driven by conventional means, but the competition were ahead by combining a number of technologies. Our management had the idea to let the new graduates loose on product development and a huge leap was made forward, sweeping aside the competition in certain applications. Fast forward a few years and we branched out (actually we were forced out) into our own company which did well and made good money. To the point where we were taken over and within a week, new management informed us we were doing it all wrong and returned the product to the 'dark' ages.

        1. Yet Another Anonymous coward Silver badge

          Re: Do not underestimate China

          Democracy not the answer.

          What does Britain (inventor of these clever things) Japan (makes all the clever things small and reliable) and the Netherlands (makes the clever machines that makes tiny clever things) have in common?

          A royal family that's what - all China has to do is return to the Emperor and it will share in the good times

          1. MrBanana

            Re: Do not underestimate China

            Defo spotted a black Daimler limo, without any number plates, cruising around Cambridge on the way to ARM. Doubtless Her Maj was just signing off on the latest chip architecture that us plebs will get in a couple of years time. Meanwhile she gets to use her own, latest, hyperscale server technology - mostly to track the cretinous activity that the rest of her family get up to.

      2. John Brown (no body) Silver badge

        Re: Do not underestimate China

        "we just couldn't figure out why the competition couldn't spend six months and catch up, but management clearly knew better than us lowly engineers..."

        Patents maybe? Only 6 months to copy what you did, but much longer to work around any patents involved?

    3. John Smith 19 Gold badge
      Unhappy

      "What we see is a fast catch-up process. "

      But the implication of the article is that it is not catching up.

      Because most of the stuff you expect to "inherit" from the previous generation of masks IE a straightforward device shrink, does not work.

      Writing a feature 1/13 the size of the radiation you are using to expose the resist with, is very hard.

      IOW, every shrink is basically, back to a full design cycle.

  6. TeeCee Gold badge

    Aha!

    It's no coincidence Intel's tick-tock wound down as DUV got incresingly (sic) weirded.

    Finally an explanation as to why Intel stalled at 14nm for so long. I'm guessing that AMD, with the benefit of doing a new architecture at the time anyway, engineered for the hoop-jumping of 7nm DUV and ported to the simpler EUV later.

    1. Flocke Kroes Silver badge

      Re: Aha!

      AMD sold off their FABs and hired whichever contract manufacturers could help them the most.

      There were plenty of reasons for Intel's delays with 10nm. One of them was control shifted away from engineers and towards MBAs. Instead of having all the latest kit to play with the engineers had to be efficient: plan out exactly what the needed, buy that, learn how to use it, find they need something else then wait around (tweak their 14nm process) until it was delivered. Another reason was Intel chose to explore a different direction to get to 10nm than other manufacturers. In hindsight, that direction was a longer more difficult path than doing both and picking a winner after getting the required experience.

    2. John 62

      Re: Aha!

      Smartphones: Intel missed the boat with smartphones (sold off their ARM stuff and couldn't get Atom to compete in a phone), so while their desktop/laptop/server market remained large, it wasn't as large as the smartphone market where there was much more volume _and_ much more pressure to reduce the node size to get perf/watt up. AMD is able to ride the wave of TSMC's investment in producing smartphone chips to eat Intel's lunch.

      Couple that to AWS developing its own datacentre CPUs and Apple jumping ship (for desktop/laptop) and Intel is in trouble.

  7. Tubz Silver badge

    The EU is to Germany what the The Greater East Asia Co-Prosperity Sphere was to Imperial Japan, a way of funnelling resources and wealth to one country and it also helped Germany dominate European mainland and decide other countries fates, without one shot being fired, ask Greece !

    1. Yet Another Anonymous coward Silver badge

      I thought it was a way for the French to pretend they had an Empire, Belgium to believe they were important and Spain/Italy/Portugal/Greece/Ireland to get hand-outs?

      Or has the Daily Mail lied to me ?

    2. Glen 1

      Germany is not only a net contributor, but contributes almost *Twice as much* as the UK did (Source)

      Its as if the benefits are more than just financial or something...

      Funnelling wealth to 'one' country by helping bankroll the others?

      Why didn't *we* (UK) get a piece of that action?

      Oh wait... /s

      1. I ain't Spartacus Gold badge

        Why didn't *we* (UK) get a piece of that action?

        The UK did prosper in the EU.

        One of the best bits of the EU, co-incidentally one of the bits that works, has broad support and makes lots of people richer, is the Single Market. In contrast to the Euro, that's half-finished, not all that popular and still doesn't work properly...

        The EU talks about the freedom of movement of people, goods, capital and services. The so called "Four Freedoms". However the Capital Markets Union has failed to materialise again (it looked to be making genuine progress a few years ago), and the EU single market in services is also still at an incredibly early stage and keeps getting blocked. Despite promises in the late 90s that it would be finished in the next decade.

        Capital and services are one of the UK's key economic strengths and the source of a lot of our exports. We opened up our markets for goods in exchange for an eventual reciprocation with services and the capital market that never happened. Before we left the EU we had a trade surplus in both goods and services with the rest of the world and a trade deficit with the EU in goods, not made up for by our much smaller trade surplus in goods and services.

        There were many good reasons to remain in the EU. There were also rational reasons to consider leaving.

        And while the anti-German comment above is hyperbolic and silly - the Euro has had the effect of making Germany richer and more powerful at the expense of some of the other Eurozone members. Italy in particular. And still, after 15 years, the Eurozone don't look any closer to a solution that will make the Euro workable and not need emergency action every time there's a recession. The German government also have a bit of a tendency of deciding that what's good for Germany is good for Europe and then getting all sanctimonious and preachy about when others disagree. We saw this with the appalling treatment of Greece during the Eurocrisis and with the Germans deliberately deciding to make themselves economically dependent on Russian gas despite the warnings of large chunks of the rest of Europe.

        Nordstream 2 in particular was signed in secret, after the invasions of Crimea and Donbas, literally a week before the rest of the EU agreed not to sign the Southstream gas deal - which Germany was urging Southern European states not to sign because it would increase dependence on Russia and because of the invasion of Ukraine. I think someone with some integrity in the German civil service leaked Nordstream 2 a week later...

        The German government pursues its national self interest, as it sees it, as is perfectly reasonable. But it's very careless of the national interests of its supposed allies. As Russia's invasion of Ukraine has revealed, yet again.

        However it's not all bad. Even the Merkel government seemed to have learned something from the Eurocrisis and came out in favour of the EU Covid Recovery Fund. Even if there still seems no solution on the horizon to fix the Eurozone. And there's movement on foreign policy since the shock of Russia's invasion.

        1. Glen 1

          Before the invasion of Ukraine (err... the bigger one), there was a case to be made that Germany buying Russian gas would make Putin hesitate to do anything too stupid.

          Sadly, this has turned out to not be true.

          Part of Germany's problem is that it decided to needlessly shut down its nuclear reactor fleet after Fukushima.

          They have turned what should have been a carrot for Putin to play nice, into a stick that the whole of Europe (world?) is being whipped with.

          1. MachDiamond Silver badge

            "Part of Germany's problem is that it decided to needlessly shut down its nuclear reactor fleet after Fukushima."

            A knee-jerk response is so much easier than analyzing the root cause for Fukushima's demise. They could have asked questions such as, did we put our backup batteries and generators below grade and sea level? Do we periodically test the passive cooling systems so technicians can see when it's on and functioning? Did we test emergency procedures before going hot? (can you use a fire engine to pump water into the reactor vessel without it being diverted to the base of the cooling towers instead?) Was there a manufacturers review of changes to the operations manual? (TEPCO was under the belief that the passive cooling system couldn't be left on and had to be cycled. It didn't have to be cycled and that bit them in the ass). There are some very good documentaries that show many of the cockups that lead to the mess in Japan. Prof. Jim Al-Khalili did one of the best analysis I've seen on what happened and explained it very well.

  8. Death Boffin
    Facepalm

    Work share

    One of the problems with EU consortiums is the concept of work share. This is where each country gets a piece of the work. I recall a semiconductor fab where the work up through the gate process was done in one country. Then the wafers were packed up and sent for the remainder of the processing in another country.

    This manufacturer maintained a consistent half decade lag on US and Asian manufacturers.

    1. Anonymous Coward
      Anonymous Coward

      Re: Work share

      That is the case for EU governmental projects.... The distribution is based on tax payments by member countries who fund the work, so fair enough.

      I don't think the plan is to get the EU to fund silicon fabs, though. The point is to have companies that build the fabs.

      1. Glen 1

        Re: Work share

        Similar to the US senate making sure their States get some of those sweet government contracts.

        e.g. The senate launch system and the space shuttle

    2. Robert Sneddon

      Re: Work share

      A lot of vertical-market companies spread chip manufacturing between many countries for various reasons. I used to work for a big European company (cough cough Eindhoven) at a design office in southern England. The chips we designed were fabbed in Germany, the wafers were shipped to Malaysia to be packaged and the chips went to various production plants scattered across the world (Spain, Mexico etc.) to be built into company-only branded devices.

      1. Yet Another Anonymous coward Silver badge

        Re: Work share

        That's common with chips made in S.E Asia as well. Fabbed in Taiwan, diced in Malaysia, packaged in Indonesia, shipped from Singapore, assembled on pcbs in China, using machines from Korea and chemicals from Japan

        It's why "we built a new fab in Alabama we are totally immune from world trade issues" is perhaps not quite as simple as that

        1. MachDiamond Silver badge

          Re: Work share

          "It's why "we built a new fab in Alabama we are totally immune from world trade issues" is perhaps not quite as simple as that"

          It's all fine and dandy until you try to find something as simple as resistors and capacitors and find out that they aren't made in the US and another PCB manufacturer dies just about every week. It won't matter if I can get the latest device from in the US if I have to send it to another country to make something with it. Never mind that I work with much older, cheaper and easier to get tech for the things I build so just about everything I need comes from overseas.

    3. anothercynic Silver badge

      Re: Work share

      Well, that process of work share has done remarkably well for Airbus... They've got the JIT dance down to a T. I've seen their production facilities...

    4. Peter Gathercole Silver badge

      Re: Work share

      And don't forget Airbus, where for a time the left and right wings for the A380 were made in different countries!

      1. Yet Another Anonymous coward Silver badge

        Re: Work share

        The A380 wing was made in Broughton in N Wales

        1. Peter Gathercole Silver badge

          Re: Work share

          I distinctly remember a documentary made during the development of the A380, which said that they only made one of the two wings for each aircraft. I can't remember where the other one was made, but it was somewhere different.

          Whether it stayed like that until the end ofproduction, I could not say.

      2. Glen 1
        Coat

        Re: Work share

        Well, some places are more left wing, others are more right wing.

  9. John Savard

    Hold on there

    It is certainly true that it would be better, from China's point of view, to be able to use EUV to make chips. However, being able to make 7nm chips on DUV is not an accomplishment of no value. For one thing, the chips we in the West are using, although they now have a layer or two made with EUV, are still mostly made with DUV, because EUV is still difficult and expensive. For another, we're still trying to make chips on process nodes beyond late 7nm. Like 5nm or 3nm. So the same tricks that were used to breathe more life into DUV, like double patterning, are going to be used in the future with EUV as well.

    Plus, of course, it may take some time for China to make its own EUV machinery. So they are not wasting their time, developing early 7nm technology is going to improve their capabilities considerably and provide them with know-how that will remain relevant for some time to come.

    1. orphic

      Re: Hold on there

      You're absolutely right but just like the other 'experts' in the commentariat, you failed to mention the 'big elephant in the room', advanced packaging. The future is going to be a trade-off between advanced node scaling and advanced packaging.

      Expertise in the industrial process even with DUV would enhance a fab's ability to quickly gain fabrication skills in advanced packaging.

    2. John Savard

      Re: Hold on there

      I should also note that the computer I'm using as my daily driver has a Ryzen 9 3900 processor in it. Twelve cores. The I/O portion of the package is on a 14nm GlobalFoundries process, but the CPU cores are on the early 7nm process from TSMC that used only DUV, if I'm not mistaken.

      So China is a few years behind... but the capacity they're developing is not going to only allow them to build chips that are hoplessly obsolete. Although, it is true that without EUV, it is a dead end - it won't let them go to 5nm, 4nm, 3nm, and so on. But will even 3nm be that much better than earlly 7nm? Or will China be able to manage just fine?

      And while it would need to get EUV lithography equipment from ASML, it claims to have some domestic capability in DUV lithography, and I don't find that claim too difficult to believe, even if their domestic DUV equipment might have some way to go before it could be used to make even 14nm parts, let alone 7nm.

  10. Teejay

    Two things

    As I said in my other, downvoted, comment: Bribery and thievery. Wow.

  11. StrangerHereMyself Silver badge

    Embargo

    The U.S. is now also trying to prevent the sale of ASML DUV (deep ultraviolet) lithography machines to China, leaving the country without any means to produce high-tech IC's unless they start making their own chip fab machines.

    If this goes through China will eventually be crippled.

    1. dajames

      Re: Embargo

      If this goes through China will eventually be crippled.

      It's the corollary to the old proverb:

      If you give a man a fish, you feed him for a day, but if you teach him to fish, you feed him for the rest of his life.

      ... but if he watches you fishing and works out how to do it for himself he will destroy your profitable fish export business within a lifetime!

      1. StrangerHereMyself Silver badge

        Re: Embargo

        This adage won't work because companies like ASML have been perfecting these technologies over decades and they're a closely guarded secret.

        Obviously China already has quite a few ASML machines in their factories. I suppose the next move would be for the U.S. to pressure ASML to stop maintaining these machines. Making them worthless after a while.

        Of course the Chinese will attempt to replicate them, but will most likely fail.

        1. This post has been deleted by its author

        2. Anonymous Coward
          Anonymous Coward

          Hardly guaranteed

          For one thing the embargo is on their most advanced processes, not on everything that ASML makes, as the world probably want's to keep buying the volume production chips that SMIC is knocking out on smaller processes.

          Cutting the cord on them may happen if the current cold war with china escalates, but event that is tricky as they have some of the worlds most advanced technology and personnel. So it's a crapshoot as to which things they will be able to keep going and which will crash. This isn't new, just look at the fact that sanctions on Cuba didn't prevent people from keeping cars running despite a lack of parts. That situation may be closer to what you'd see with advanced processes in china after a hard embargo. Some companies would figure out how to eke by while building and maintaining their own tools, some would grind to a halt, and quality and yield would drop. But the only level I expect them to fail at for sure is at the total scale of industry, where they like anyone else, find out they can't compete with the whole world on every technology and industry at the same time.

          A bigger take away from the article as I see it is that they have begun to operate one of the most complicated and demanding processes ever attempted by the semiconductor industry. Yeah, it will probably never compete at scale, but you could say the same about the people that make pocket watches. I'm not worried that the Chinese will take over the world with pocket watches. I am paying attention because the people who can do that could switch over to making something more dangerous like bomb fuses. The sub 30nm processes aren't needed for most or even many advanced military technologies. If they are good enough to get low yield production of working parts off of that 7nm DUV process, they may be getting great at process nodes that matter for most military applications.

          That would put us into a dangerous time for the world, where China has the ability to survive sanctions and still wage war, but still has a chance to seize the advanced production capabilities of it's neighbors. Until those locations have diversified their operations to ensure the rest of the world can limp along without the capacity of TSMC and the east pacific rim production sites, China may see and seize a window of opportunity. I doubt they will risk a move before the US midterms, and if they see a favorable outcome or a weak opposition they may move. Remember that while we may not talk about it enough, Xi knows exactly what he has done to stay in power, and knows that conflict with the other world power is almost inevitable during his tenure.

          That is why spinning up the US fab sites quickly is essential, it neutralizes one threat while presenting another. If China pushes hard at that point, not only will they get sanctioned, they will drive business to otherwise unprofitable fabs outside China and Asia and create a market that will let TSMC profiteer their little hearts out. Those fabs could then re-invest the profits into building a new China somewhere else further from China's sphere of influence. Xi's less of a gambler then Putin at this point, so making the odds favor peace is probably worth the billions.

          1. martinusher Silver badge

            Re: Hardly guaranteed

            Bear in mind that all this anti-China stuff really started spinning up with 5G and the realization that a) Huawei had a lock on the technology (about 2/3ds the patents), Huawei had at least a two year lead in implementing it and c) that companies like Qualcomm that had enjoyed a patent monopoly with 4G were in danger of being relegated to also-rans. Now we've allowed this to get out of control so instead of China being the Good Global Citizen who just happened to be eating our lunch in sectors of the global market (but also being a paying customer in other segments) we're now in full Cold War mode. I've said repeatedly that getting into this situation was a stupid thing to do because ultimately its a war we can't win, if for no other reason than we don't need to keep making ever more powerful smartphone chips. (Remember that China was doing OK in fields like super computing and AI....but its fine scale processors used in mobile devices that are the big thing, the only thing.)

            We in the US have allowed our production capability to run down and it will take more than a quick infusion of cash to fix this. It will take time. People in the UK should know about this -- how many government funded initiatives have been hyped up over the years only to crash and burn or just fade into irrelevance?

            IMHO the key the future is in the dismal salaries and working conditions we're forcing teachers to work under. Pair this with a university system that encourages vocational education to get earning as much as possible as quickly as possible and its a formula for "we're screwed". We in the US have also been used to the luxury of importing our talent; this isn't quite the attraction that it used to be (government policy, again). A lot of things need to be fixed but I daresay you will never stop politicians tilting at windmills.

      2. MrBanana

        Re: Embargo

        "...but if you teach him to fish..."

        He'll sit in a boat for a day getting drunk.

      3. MachDiamond Silver badge

        Re: Embargo

        "... but if he watches you fishing and works out how to do it for himself he will destroy your profitable fish export business within a lifetime!"

        When the Wall came down and many Russian engineers were scrambling to go West, I met some great innovators that could do more advanced work on a 640kb early PC than I ever imagined could be done with those beasts. With limited tools, they had to be very efficient. We may see the same thing again as we approach the realistic lower limit to semiconductor process sizes. Even if China were stalled at the 7nm level, they could still get to the point where they're getting more done than somebody pushing 3nm.

  12. Lordrobot

    Toyota's First US car was considered underpowered against the Proud Olds and Pontiac 455 mills...

    So where is the US 7nm chip? It is in TAIWAN! I see. Well, then where are Oldsmobile and Pontiac? In the blowhard graveyard. And where is Toyota? Top of the pyramid. I see.

    This may sound redundant but if the US is so great at Chips and controlling European Companies such as ASML, how come there are no 7nm fabs in the US? How come intel failed at 10nm and is now leading the insane FAB Brigade?

    Let's consider one salient point. 95% of the global semiconductor market are chips larger scale than 14nm. So all this bellyaching and pre-braggadocio, so common to Americans... strikes me as vapid yapping rights. The US is five years from 7nm fab. Where will China be in Five years? They will own 95% of the existing 95% semiconductor market today. Americans are blinded by their own wonderment and braggart's invincibility.

    Where is the US going to be in 5 years when China owns the 14nm and larger markets and don't need to buy any US or UK or European Chip designs? And of course, Korea is going to stand still for all this.

    Oh but but but 2nm is the future. No, it's not. That notion has already been proven wrong with PCs. A $100 GPU improves PC performance far beyond a $600 CPU. Packaging trumps scale. Narrow gate fab produces less chips at a higher cost and they don't like the heat.

    This chips war which is an extension of Trump's failed trade war and tariff war and sanctions war and the myopic hips cold war will be America's own undoing.

  13. TheGuyUk

    You have it wrong, the next war will be chip instruction set, memory and storage. After those OS. What matters is Chine learns how to build its own node chips, not the node.

  14. Anonymous Coward
    Anonymous Coward

    So...

    Cheap China junk knock-off. Well, that's a shock.

    1. Yet Another Anonymous coward Silver badge

      Re: So...

      Don't worry those wily little oriental chappies can only produce cheap copies they will never make anything better than us - chaps don't even play cricket

  15. Anonymous Coward
    Anonymous Coward

    Hmmm, the arrogance of the article!

    I find it amusing how China is always underestimated just how the Russians have few weeks to be without weapons to continue their war on Ukraine.

    Any body honestly determined enough can eventually catch up.

  16. Morrie Wyatt
    Black Helicopters

    Beware how you tread.

    Sand stampers and Melange are a dangerous combination. You need to watch out for the Makers.

    (Icon? Closest thing to an ornithopter I could find.)

  17. CFtheNonPartisan

    For thought. A bit of arrogance will be the west's downfall. It was only a few decades ago that Chinese technologies were almost prehistoric. The west was dismissive. Slowly Chinese steps from behind became louder, their sophistication improved, and their underlying infrastructure such as supercomputing capability grew to equal and exceed the west. The capitalistic west will sell anything for a few dollars and the Chinese are happy to buy it or appropriate (steal) it if the west is not selling. Know how and doing it are intertwined but 'doing it' wins against 'knowing how to do it' when they are not one and the same side.

    With so much manufactured in China and 'Chinese Taiwan', if or when there is reunification or even if not, who 'owns' the underlying capability of the electronics industry? Globalists have taught there is a common good and a common profit motive and global inter-reliance will temper political interests. Ukraine, Russia and Cuba (in spite of US sanctions) disprove it at least in a century time window. China is today's 300 tonne gorilla and the west seems to be slow marching in response.

  18. MachDiamond Silver badge

    And the USA

    The US is proposing handing out billions of Govbucks for companies to set up fabs in the US. The issue is that the State department gets their manicured hands in and requires that companies with processes below a certain scale to request and receive approval for export. This is why fabs have been built in other parts of the world. Who wants to have some govdrone acting as gatekeeper to making a sale and taking months to make that decision? Even though China is showing they can produce at the 7nm scale, the US Department of Chasing Away Business will set the export regulations at 15nm. Since it makes no sense to build a fab to operate below the current state of the art, they won't be constructed in the US unless they have a guarantee that the government will buy all of their output. That product will sit in a warehouse while government procurement departments will buy products on the open market for less money from any old country. This is how production of military electronics can come to a screeching halt. This is an area where I'm very upset over government meddling if it doesn't already show.

  19. caesium

    Economically the article's arguments are irrelevant

    Let's assume for the sake of argument that China NEVER ever figures out EUV. Furthermore, let us assume that China is banned from importing any processor from any other country forever, and smuggling has been eradicated from existence.

    What kind of application could they not achieve with sufficient number of 7nm chips? Well, they'd lose the computer manufacturing market for software pros, which including servers, laptops, and some more niche gizmos like VR sets - but everything else would be fine, including just about all industrial applications and all military applications. These applications haven't even reached 22nm in mass use! Even cloud hosting would be fine - the CPU is mostly abstracted away anyway, so they'll just use more processors. Even smartphones may be fine (most users already have enough computing power for their uses), and frankly, most light computer users can do with 7nm (I'm writing this comment on a 7nm). So basically we're talking about very limited economic damage if there were an import ban, which there isn't.

    The proper takeaway is that for every practical purpose China has the chips it needs, even if it's not the smallest and newest node. Instead of chips, the West should concentrate on arms to match PLA growth.

  20. Anonymous Coward
    Anonymous Coward

    Did you say bitcoin-mining ASICs?

    I thought bitcoin was supposed to be banned over there. Or is this another case of "just because we've banned it doesn't mean we can't manufacture it for export"

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