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Frequent Contributor

Intel Corp.’s decision to consider outsourcing

This is indeed a bad news for US manufacturing and national security. I am person who knows something about this and who taught the area for two decades. The gain will be that of TSMC (Ticker - TSM), not even AMD. I used the paramter set from TSMC processes for student designs as well as my own which were freely available - like open source but not from Intel. It seems that Intel dropped by 16.5% but not sure what will happen on Monday. Chinese may take over this also sooner.

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Re: Intel Corp.’s decision to consider outsourcing

ECPROF,

I do not have a clear understanding.  Are we saying that if the chip manufacturing is in Taiwan (i.e. TSMC), China has access all the intellectual property of Intel's designs?

SRT

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Explorer ○○○

Re: Intel Corp.’s decision to consider outsourcing

Engineers finally vanquished by bean counters?

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Frequent Contributor

Re: Intel Corp.’s decision to consider outsourcing


@sthanga wrote:

ECPROF,

I do not have a clear understanding.  Are we saying that if the chip manufacturing is in Taiwan (i.e. TSMC), China has access all the intellectual property of Intel's designs?

SRT


No, not right now. TSMC is in Taiwan. TSMC has been and will be very competetive.

But, China has been very active in chip manufacturing too. So, they might develop the manufacturing to the level required by the world and start the business. Just like Apple depends on China for manufacturing, Intel may end up manufacturing the chips in China for lower costs to be competetive. Who knows? China may take over Taiwan just like they did Honkong. It is only a question of time.

China also has a lot of engineers from India. India brought them plane loads of them back due to COVID-19. Now, afer recent skirmish in Ladakh, Indo-China relationship is going south. US is trying to form a QUAD of Japan, Korea, India and USA. Indeed, India wants to add Australia in this group. But, China is a big market for Australia and has been hesitation to join the group. International relations are very complicated and cannot be just "black and white."

 

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Contributor ○○○

Re: Intel Corp.’s decision to consider outsourcing

Seems like Intel is no longer needed if they outsource chips. They are the standard. This is too bad for US manufacturing. 

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Contributor ○

Re: Intel Corp.’s decision to consider outsourcing

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Frequent Contributor

Re: Intel Corp.’s decision to consider outsourcing

I checked M* to see what kind of stocks are active and what are the high flyers. Guess what? The first high flyer was the tech. company Sogou Inc. - ADR. The second top high flyer was "UMC ADR." The company is United Microelectronics Corp. - Both  are Chinese companies. Microelectronics is my area of specialty (I mentioned in my OP). See who benefits from the Intel's problems? Check where the money is going - to China.

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Frequent Contributor

Re: Intel Corp.’s decision to consider outsourcing

https://finance.yahoo.com/news/mark-cuban-says-could-greatest-150124014.html

“We can not control our own destiny if we don't build here...If we want to protect our future, we need to make investments in manufacturing of chips and all advanced technologies a national priority or we will find ourselves on the outside looking in, wondering why we are no longer a global economic and military super power,” Cuban said.

My last design process was 15 nm process. It is more than decade ago. Over a decade, it has become 9 nm process. To take it further, they are having difficulty in the 7 nm process.

"Until Intel gets its 7nm production on track, investors can expect AMD to continue to gain market share and third-party producers like Taiwan Semiconductor to benefit from potentially massive demand from Intel."

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Explorer ○○○

Re: Intel Corp.’s decision to consider outsourcing

Conversation in 2015 between Intel engineer and bean counter :

Engineer: We need to get going on the next node, and we need significant capital investment to do that.

Bean Counter: Are we behind on process technology?

Engineer: No, but we have to keep moving forward or we will be.

Bean Counter: How much do you need?

Engineer: Billions

Bean Counter: Will this new process node make us more profitable than the last. Will it give us higher productivity?

Engineer: No

Bean Counter: So you want me to spend billions on something that won't benefit the business?

Engineer: You won't have a business if you don't push this.

Bean Counter: Get this jerk out of here, he doesn't understand how business works, I never want to talk to him again

 

Conversation in 2020:


Bean Counter: What is going on with all this negative press about our process node?

Engineer: TSMC passed us up, and AMD is using their node.

Bean Counter: So? We're still making a lot of money.

Engineer: We won't be if this continues.

Bean Counter: Well, where are we on this node, we've been talking about it for years. Why can't you guys do your job?

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Frequent Contributor

Re: Intel Corp.’s decision to consider outsourcing


@ignatz 

Thanks for a nice conversation. I enjoyed it as a former ECE prof.

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Participant ○○

Re: Intel Corp.’s decision to consider outsourcing

I started my engineering career in MOS technology, 50 years ago. We had 1,5" wafers in those days. Boy, it's sad that Intel can't make it.  Well, Micron is still making memory in ID.

 

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Re: Intel Corp.’s decision to consider outsourcing

It is happening in every industry and has been going on for a long time. When bean counters and money managers rule over everyone, bright young Americans choose bean counting over engineering or other STEM and those subjects eventually get devalued by the populace at large.  Another Sputnik moment will have to happen before anything changes. 

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Re: Intel Corp.’s decision to consider outsourcing


@SJ60 wrote:

It is happening in every industry and has been going on for a long time. When bean counters and money managers rule over everyone, bright young Americans choose bean counting over engineering or other STEM and those subjects eventually get devalued by the populace at large.  Another Sputnik moment will have to happen before anything changes. 


A 'Sputnik moment'. Wow that brings back memories. The U.S. initially getting its butt kicked in the space race. We do need some inspiration here. It does seem like we've gotten fat, dumb and happy.

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Re: Intel Corp.’s decision to consider outsourcing


@ECEPROF wrote:

I checked M* to see what kind of stocks are active and what are the high flyers. Guess what? The first high flyer was the tech. company Sogou Inc. - ADR. The second top high flyer was "UMC ADR." The company is United Microelectronics Corp. - Both  are Chinese companies. Microelectronics is my area of specialty (I mentioned in my OP). See who benefits from the Intel's problems? Check where the money is going - to China.


UMC was founded in 1980 in Hsinchu, Taiwan and it still maintains its HQ there. It is not entirely wrong to say that it is a Chinese company because its official name is Republic of China, but there is a marked distinction between ROC and PRC. The first company you mentioned, Sogou, is indeed a Chinese company based in Beijing.

Sogou's stock price has rocketed more than 50% in the last 2 trading days. But I do not believe that means "money is going to China". That price could easily tank double digits in the next few daya/wks/mos. UMC stock price has also rocketed in the past few trading days, but that is money going to Taiwan, which is also where the TSMC HQ is. It will be interesting to know why the buyers think those 2 companies can benefit from Intel's woes to justify the >50% gains in the last 2 days. Or, could it be just a speculation? Or, anything but Intel?

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Re: Intel Corp.’s decision to consider outsourcing

INTC is ordering latest chips from TSM. Its head of engineering is leaving. Current CEO Swan is M&A/restructuring specialist.

https://finance.yahoo.com/news/intel-now-ordering-chips-tsmc-072255657.html

https://www.cnbc.com/2020/07/27/intel-engineering-executive-murthy-renduchintala-will-leave-company....

YBB
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Re: Intel Corp.’s decision to consider outsourcing


@yogibearbull wrote:

INTC is ordering latest chips from TSM. Its head of engineering is leaving. Current CEO Swan is M&A/restructuring specialist.

https://finance.yahoo.com/news/intel-now-ordering-chips-tsmc-072255657.html

https://www.cnbc.com/2020/07/27/intel-engineering-executive-murthy-renduchintala-will-leave-company....


I have known that TSM has been/is the foundary for a lot of companies. I used the process parameters of TSM for my/student designs in my former carrier. I jumped into the VLSI area in the early 90s' and started teaching first the graduate and then the senior undergraduate students. Indeed, I forced my son also to do the same in his graduate program in UT.  He also iterned in Philips Semiconductors located near San Jose. Since he has now become a software guy for living, and he thinks that he had wasted two years because he is not using that knowledge.

There is also a foundary somewhere in the Southern California - San Diego?

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