Our lives have become digital. If you need confirmation of this just look at your morning routine. You are awakened by a vibration from your smartwatch. You reach for your cell phone charging wirelessly next to your bed. Facial recognition brings your phone to life where you check your mail, current news, daily agenda and the social postings of friends and family. And finally, you tell Alexis to turn on the lights and start the coffee maker before your feet ever hit the ground.
Locked in your phone, within your smart speaker and buried in data centers out of sight, are the brains of all technology – the semiconductor. Invisible to most consumers, the semiconductor has been taken for granted and seen as “uncool” for the last 20 years while software reigned “king”. Not anymore. In recent years, the semiconductor has been thrust into the limelight and once again and it is “cool” to be in semiconductors. Here’s why.
The chip shortage is everywhere
As the old saying goes “any publicity is good publicity” and this couldn’t be any truer for the semiconductor industry. Spurred by the pandemic, consumer demand for cars declined and manufacturers shifted production to high demand areas such as personal computing and mobile devices. After the lockdown ended, automobile demand increased, but semiconductor companies did not have the product available to meet demand and the chip shortage was born. Why is this good? It really isn’t, but as far as the visibility goes it had an immediate impact on the industry. Every consumer suddenly understood technology is nothing without semiconductors. Overnight semiconductors went from obscure, uninteresting and uncool to front-page news.
US semiconductor manufacturing is making a comeback
According to the Semiconductor Industry Association (SIA), the U.S. share of global semiconductor manufacturing has decreased 25% from 1990 to 2021. However, 47% of the semiconductors around the world are designed in the U.S. The gap between U.S. designed chips and manufacturing capability, has prompted U.S. to declare semiconductors an essential element of national security and prompted the $52B Chips Act. Recently some of the largest chipmakers – GlobalFoundries, Intel, Samsung Foundry, TSMC and Texas Instruments – have started building or have plans to build semiconductor production facilities in the U.S. It is expected these companies will spend $70B by 2025 and $100B by 2032.
Everyone is jumping into the chip arena
Not everyone can afford to build a fab. Cutting-edge semiconductor manufacturing fabs cost in anywhere from $20B on up. The economies of scale are simply too high for a newcomer to break in. However, despite significant barriers to entry in design, many of the well-known ‘hyperscalers’ such as Apple, Tesla, Amazon, Google, and Microsoft are designing inhouse chips to reduce costs, unlock performance gains and customize chip functionality.
Our lives have become digital. If you need confirmation of this just look at your morning routine. You are awakened by a vibration from your smartwatch. You reach for your cell phone charging wirelessly next to your bed. Facial recognition brings your phone to life where you check your mail, current news, daily agenda and the social postings of friends and family. And finally, you tell Alexis to turn on the lights and start the coffee maker before your feet ever hit the ground.
Locked in your phone, within your smart speaker and buried in data centers out of sight, are the brains of all technology – the semiconductor. Invisible to most consumers, the semiconductor has been taken for granted and seen as “uncool” for the last 20 years while software reigned “king”. Not anymore. In recent years, the semiconductor has been thrust into the limelight and once again and it is “cool” to be in semiconductors. Here’s why.
The chip shortage is everywhere
As the old saying goes “any publicity is good publicity” and this couldn’t be any truer for the semiconductor industry. Spurred by the pandemic, consumer demand for cars declined and manufacturers shifted production to high demand areas such as personal computing and mobile devices. After the lockdown ended, automobile demand increased, but semiconductor companies did not have the product available to meet demand and the chip shortage was born. Why is this good? It really isn’t, but as far as the visibility goes it had an immediate impact on the industry. Every consumer suddenly understood technology is nothing without semiconductors. Overnight semiconductors went from obscure, uninteresting and uncool to front-page news.
US semiconductor manufacturing is making a comeback
According to the Semiconductor Industry Association (SIA), the U.S. share of global semiconductor manufacturing has decreased 25% from 1990 to 2021. However, 47% of the semiconductors around the world are designed in the U.S. The gap between U.S. designed chips and manufacturing capability, has prompted U.S. to declare semiconductors an essential element of national security and prompted the $52B Chips Act. Recently some of the largest chipmakers – GlobalFoundries, Intel, Samsung Foundry, TSMC and Texas Instruments – have started building or have plans to build semiconductor production facilities in the U.S. It is expected these companies will spend $70B by 2025 and $100B by 2032.
Everyone is jumping into the chip arena
Not everyone can afford to build a fab. Cutting-edge semiconductor manufacturing fabs cost in anywhere from $20B on up. The economies of scale are simply too high for a newcomer to break in. However, despite significant barriers to entry in design, many of the well-known ‘hyperscalers’ such as Apple, Tesla, Amazon, Google, and Microsoft are designing inhouse chips to reduce costs, unlock performance gains and customize chip functionality.