Even if the ban of high-end chips to China is lifted in future, China must think carefully whether it is worth the risk of relying on USA crafted chips. It is perfectly logical for China to just develop its own high-end chips and stay away from those made by USA and its allies.
If you are just a friendly country of the USA stay away from buying USA fighter jets and defense weapons. It is better to be safe than sorry. If you are an ally, too bad, you are arm twisted, and you have no choice but to follow the doctrine of 'You are either with US or against US'.
Anonymous
1 comment:
The Nexperia issue exposed to us something very important about chips. High-end chips are important for particular sectors like the military, AI and top tier mobile phones. Medium range legacy chips are equally important to run other consumer products like EVs and home appliances, which covers a widely extensive market demand for them, the benefits of which had not been focused on by the USA and the West. China saw the opportunity, while the USA was and is still fixated on taking control of the top end chip market and denying China the path to reach it.
Nexperia produces just medium end legacy chips for a particular sector, the car manufacturing sector that the West ignored as unimportant for years or did not imagine its importance until now. The arrogance of the West looking down on China, thinking that chefs, laundrymen and peasants can never make or conquer the vehicle market is coming back to haunt them. China had been ramping up its facilities to produce such chips for its EVs and home appliances expansion over the years, the really hungry demand sector for chips. This was based on the older lithography machines bought from ASML and put to good use, not those EUV machines banned later. China saw the loophole and leveraged on it, while the world chipmakers were fighting tooth and nail to produce the most expensive 3 or 2 nanometer chips. Now, the shit has hit the fan over the Nexperia fiasco, and they realized that legacy chips are just as important for powering consumer products, like EVs and home appliances.
The USA and the West realized too late and was trying to use a short cut method to control the legacy chip sector, thinking that seizing Nexperia is a way to do it. In this game, China is ahead of the curve, already seeing the problem and keeping the productive capacity safely at home. The USA via the Dutch can take the nameplate and the mailbox of Nexperia, but the most valuable asset still belongs to China at home.
China will find ways to fix the high-end chips and coming up with different machines, materials and method for making them. It is just a matter of time. Now, even AI is not all about having the most expensive high-end chips, but how even lesser chips could be expertly put together to produce the same result. Moreover, what is even more important, as Jensen Huang himself admitted, is the ability to leverage AI on cheap energy, which China is able to afford, thanks to Russia.
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