There aren’t enough chips to go around.The continued global lack of semiconductors means the difficulty in purchasing a PlayStation 5, Xbox Series X, or high-end GPU from companies like Nvidia or AMD may continue. For months – if not for the rest of 2021.
And it’s not just gaming gear, though.Car companies like Ford and GM are having problems with Foxconn truck production, Apple’s supplier is warning of some of the delays that could last until 2022, the 5G rollout has begun to be delayed, and Samsung warned. To the “serious imbalance”; in the semiconductor industry.
There are a number of reasons why the shortage is happening right now: reduced delays from the closure of COVID-19’s plant last year, a spike in demand from customers stranded at home during the time. There is an outbreak of needing a new laptop, along with other political issues such as former President Trump’s trade war with China.
But the problem goes even deeper: not that there aren’t enough chips because there aren’t enough chip manufacturers. “In 2000, we had 30 companies that made their own integrated circuits. They then discovered that it was cheaper to hire outsiders, ”UCLA’s Professor Christopher Tang explained in an interview. The Verge.
As the ever-growing demand for products and computing nature of mundane products such as cars or smart home accessories increases, chips are no longer needed. But, at the same time, the industry has become smaller over the decades as many technology companies and even chipmakers like AMD have shifted to fabless models, which they employ outside of actual production for other companies (eg. Samsung or TSMC)
Solving this Chip shortages, though, are only a matter of time: demand will eventually stop overtaking limited supply and things should return to normal. (And you’ll be able to buy PlayStation without jumping through online hoops and endless digital queues.)
But preventing future shortages may require bigger changes in the large semiconductor industry to reflect our ever-expanding digital world. We’ve seen some of that: TSMC has announced a $ 100 billion investment plan over the next three years to increase its capacity to support the growing demand, and Intel plans to spend $ 20 billion on expansion. The Arizona-based fab includes opening the door to produce chips for other companies (similar to what TSMC and Samsung already do), adding a new big supplier to the market.
But those changes will take time and industry commitment to building a healthy supply chain for years and decades to come. And there’s very little chance of making it easier to buy a rare gadget in the coming months. But in the end, those changes might make it easier to buy a fictional PlayStation 6 or Xbox successor.