Chinese government is not stupid. They have a strategy (more so than USA does). Years ago that was to dominate global manufacturing and supply chains. They were successful. Now the goal is to reach parity with Western chipmakers and/or get ahead. It’s happening.
The AI boom was like a golden gift to them. Semiconductor prices are through the roof. So if they can produce almost anything at all in quantity it will sell for inflated prices.
While the tech companies of the world jerk each other off with AI, China is building DRAM capacity. CXMT is the first and will not be the last. They will scale quickly. If they have the process perfected they will build a fab in the time it takes USA to conduct the environmental review for the consideration of allowing a permit application to build a fab. They will not build one fab they will build 5 or 10. I’m proud to be American and I love my country but I compare USA to China on the ability to execute large projects like this and China will win every time. We have too much red tape, too many lawsuits and insurance and moving parts. China executes faster and more decisively.
So give it a year or two and China will have a fleet of pretty good fabs. They will sell memory for way less than what the others do. And then just as China made themselves indispensable for manufacturing, they will make themselves indispensable for DRAM.
Much of that red tape is there for good reason. It protects our natural resources and our citizens. I don’t disagree the US could do better, but things like environmental studies are important to ensure healthy growth, not just rapid. AI data center bullshit happening right now is a perfect example of the impact and destruction of steamrolling these things.
There’s also the issue of things not necessarily having to be the MOST profitable thing ever. Memory manufacturers decided to go to the highest bider because money. I suspect Chinese company will be quite happy to just flood the market with cheaply priced (relatively speaking) products and just get everyone’s money.
I suspect Chinese company will be quite happy to just flood the market with cheaply priced (relatively speaking) products and just get everyone’s money.
And will still be able to make a very healthy profit by doing that.
The quest for “max_profit” is not (and never has been) sustainable.
HBM has massive profit margins. It’s also hard as hell to make, as it involves multiple stacked wafers. This vid is a good catchup on that and the rest of this situation.
China will HAPPILY flood the non-HBM DRAM market with memory ‘only’ 2x as expensive as last year. And every PC maker, automaker, gadget maker, etc will happily buy it because as Valve famously put it, “They give us a price every month or something, and they say ‘you can buy that many’ and it’s yes or no, and if we say no then they never talk to us again.” Source interview. If China says ‘we have consistent price, we have consistent supply, we can meet your needs’ and the quality is decent then it doesn’t matter if it’s slower or DDR4 or whatever people will love them for it.
And play that ahead.
The big 3 are focused on HBM and most of their capacity is already sold through 2027
If China can scale up production of standard DDR4/5 and sell it reliably at 200% of normal price (aka, below current market rates) then there’s less incentive to build fabs. So they will let China have the consumer market with their blessings. And thus China will have made themselves essential in yet another product supply chain.
The concept of IP is theft to begin with. No technology arises from a vacuum, it is all built on the collective efforts of humanity through the ages. The fact that some billionaire can claim ownership over an idea is a moral failing of capitalism.
Yeah, I generally agree with you. Just seems unfair that China gets to reap the rewards for the efforts of people working elsewhere. The fact that billionaires just pocket all the rewards anyway makes that point a bit moot.
As a member of the working class, I don’t particularly mind if a socialist country reaps the rewards of my work. Also, it’s not like IP is a zero-sum game, and that an idea put into use in one place means it can’t be put into use in another. It’s like ancient Babylon getting mad at Sumeria for putting seeds into the ground.
Yah I used to be on the “China steals” bandwagon, back when it had weight but now it doesn’t matter, even when it come to Chinas genocide of the ueagers, America is helping cause gaza with isreal not to mention what its doing to Cuba. America is no better then China now in my eyes.
Yeah, I’m with you on this. China has been a much more responsible member of the international community than the US. I strongly disagree with what China is doing with regard to Taiwan, the South China Sea, and suppression of free expression, but otherwise they’re the lesser of two evils.
This was easy to predict.
Chinese government is not stupid. They have a strategy (more so than USA does). Years ago that was to dominate global manufacturing and supply chains. They were successful. Now the goal is to reach parity with Western chipmakers and/or get ahead. It’s happening.
The AI boom was like a golden gift to them. Semiconductor prices are through the roof. So if they can produce almost anything at all in quantity it will sell for inflated prices.
While the tech companies of the world jerk each other off with AI, China is building DRAM capacity. CXMT is the first and will not be the last. They will scale quickly. If they have the process perfected they will build a fab in the time it takes USA to conduct the environmental review for the consideration of allowing a permit application to build a fab. They will not build one fab they will build 5 or 10. I’m proud to be American and I love my country but I compare USA to China on the ability to execute large projects like this and China will win every time. We have too much red tape, too many lawsuits and insurance and moving parts. China executes faster and more decisively.
So give it a year or two and China will have a fleet of pretty good fabs. They will sell memory for way less than what the others do. And then just as China made themselves indispensable for manufacturing, they will make themselves indispensable for DRAM.
Much of that red tape is there for good reason. It protects our natural resources and our citizens. I don’t disagree the US could do better, but things like environmental studies are important to ensure healthy growth, not just rapid. AI data center bullshit happening right now is a perfect example of the impact and destruction of steamrolling these things.
There’s also the issue of things not necessarily having to be the MOST profitable thing ever. Memory manufacturers decided to go to the highest bider because money. I suspect Chinese company will be quite happy to just flood the market with cheaply priced (relatively speaking) products and just get everyone’s money.
And will still be able to make a very healthy profit by doing that.
The quest for “max_profit” is not (and never has been) sustainable.
This 100%.
HBM has massive profit margins. It’s also hard as hell to make, as it involves multiple stacked wafers. This vid is a good catchup on that and the rest of this situation.
China will HAPPILY flood the non-HBM DRAM market with memory ‘only’ 2x as expensive as last year. And every PC maker, automaker, gadget maker, etc will happily buy it because as Valve famously put it, “They give us a price every month or something, and they say ‘you can buy that many’ and it’s yes or no, and if we say no then they never talk to us again.” Source interview. If China says ‘we have consistent price, we have consistent supply, we can meet your needs’ and the quality is decent then it doesn’t matter if it’s slower or DDR4 or whatever people will love them for it.
And play that ahead.
The big 3 are focused on HBM and most of their capacity is already sold through 2027
If China can scale up production of standard DDR4/5 and sell it reliably at 200% of normal price (aka, below current market rates) then there’s less incentive to build fabs. So they will let China have the consumer market with their blessings. And thus China will have made themselves essential in yet another product supply chain.
Sure helps when you just steal the technology. Seems to be a theme over there… https://www.tomshardware.com/pc-components/dram/cxmt-planned-to-use-stolen-samsung-ip-to-develop-its-dram-court-hears-former-samsung-engineer-who-jumped-to-chinese-memory-maker-now-behind-bars
The concept of IP is theft to begin with. No technology arises from a vacuum, it is all built on the collective efforts of humanity through the ages. The fact that some billionaire can claim ownership over an idea is a moral failing of capitalism.
Yeah, I generally agree with you. Just seems unfair that China gets to reap the rewards for the efforts of people working elsewhere. The fact that billionaires just pocket all the rewards anyway makes that point a bit moot.
As a member of the working class, I don’t particularly mind if a socialist country reaps the rewards of my work. Also, it’s not like IP is a zero-sum game, and that an idea put into use in one place means it can’t be put into use in another. It’s like ancient Babylon getting mad at Sumeria for putting seeds into the ground.
Tbh, I’m still mad at Sumeria
As an earlier post pointed out - the Ai industry stole everything with the support of the government at our expense. The point is moot.
If the Chinese theft benefits us as consumers then they are the Robin Hood of computation hardware. The good guys.
They didn’t steal from “us”. They stole from the billionaires. I’m fine with it.
Yah I used to be on the “China steals” bandwagon, back when it had weight but now it doesn’t matter, even when it come to Chinas genocide of the ueagers, America is helping cause gaza with isreal not to mention what its doing to Cuba. America is no better then China now in my eyes.
Americans, and I say this as an American, have always been ignorant and hypocritical in what the US government has done and is continuing to do.
Not always.
Yeah, I’m with you on this. China has been a much more responsible member of the international community than the US. I strongly disagree with what China is doing with regard to Taiwan, the South China Sea, and suppression of free expression, but otherwise they’re the lesser of two evils.
I wouldn’t say theyre lesser, I’d say their a out as bad as eachother tho. China is a lot better then it used to be to add to that
Is this a surprise?
Semiconductor production is a national priority for China.
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