Comment by zozbot234
3 days ago
The domestic industry is still there, only instead of mass-market DRAM it has started making higher-valued varieties of the same stuff. If there's a trade war, they can easily reconvert to making the mass-market stuff, just at much higher cost. You can't expect more than that, since they never really were as big or as low-cost as the lowest cost suppliers can be in normal times. That's not "losing" capacity, it's just acknowledging that you can't create capacity out of thin air.
No, the domestic industry stagnates (at best) or disappears (at worst).
You can't just spin up a 2nm wafer fab when the latest you've been running is a 300nm process.
Compare: US shipbuilding industry to China or SK.
We don't want to spin up wafer fabs because, historically, they had a tendency to turn into Superfund sites. That's why the more modern approach is to build the fab in the middle of a frickin' desert.
Historically, but likely not anymore. You wouldn't be allowed to casually poison the ground in a Western factory anymore and we have the technology to keep the environment mostly clean. I don't even see it being very expensive compared to other fab costs. Have a sealed floor and proper waste / exhaust processing, don't spill in the first place. Things must be extremely well controlled anyway.
> If there's a trade war, they can easily reconvert to making the mass-market stuff
Factories, tooling, supply chains, and engineering knowledge aren't fungible in the way they would need to be for your statement to be true.
Different types of DRAM can literally be made from the same already-etched wafer. The DRAM bits themselves don't change at all. What's different between DDR4, DDR5, and HBM is the IO interface to the chip. Changing this does not require significant retooling or relearning.
> The DRAM bits themselves don't change at all. What's different between DDR4, DDR5, and HBM is the IO interface
That's not completely accurate - since the bw between these are different, the routing and therefore propagation delays for DDR4 won't allow it to magically be used as DDR5 or HBM.
If you design for the most strict timings, then sure.
> Different types of DRAM can literally be made from the same already-etched wafer.
The assumption here is that you would stop making DDR5 but continue to make DDR4 so that you could start making DDR5 again without too much trouble. But the older chips have even lower margins than the newer ones. Most of the fabs and equipment for making DDR4 were created when it was current and then they stay in operation as long as there is still enough demand for it.
If you don't make DDR5 and DDR6, what happens to your DDR4 fabs when DDR4 is where DDR2 is now? They close because nobody wants it anymore. And then you're not trying to get to DDR6 from DDR4, you're trying to get to DDR6 from an empty desert.
Does that mean CXMT is one inch away from also eating into the DDR5 market?
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> If there's a trade war, they can easily reconvert to making the mass-market stuff, just at much higher cost.
"easily" is doing a lot of work in that sentence. Depending on the good and what they switch to making, this may neither be easy nor quick.
If the domestic industry had the capability of competing with China on mass-market goods at a profit but just chooses not to in order to pursue a higher-profitability niche, why not simply grow and do both at the same time, instead of yielding the mass market to China?
In my mind, if it can't do that, then it can't make the volume that China does at the cost that China does, which means it really isn't as capable as Chinese industry.
Perhaps at one time it could have, but those muscles have atrophied.
Because by pursuing a more profitable niche, you can grow quicker and make more profit. If you really want to do both, you enter the mass market from above, with only slightly higher quality products than what the market leader offers. And you do that after your position in the more profitable niches has long been secured. It's silly to do it any other way.
> which means it really isn't as capable as Chinese industry.
But this was always true. There was never really a time when Western industry was producing as much and as cheaply as China is today - that's the whole point. It makes more sense to diversify away from that, because non-trivial real-world markets will always reward increased variety.
Higher valued varieties, or just higher priced varieties, that no one wants to buy?