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US Intel

(stratechery.com)
539 points maguay | 1 comments | | HN request time: 0s | source
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themgt ◴[] No.45026515[source]
I’ll be honest: there is a very good chance this won’t work .... At the same time, the China concerns are real, Intel Foundry needs a guarantee of existence to even court customers, and there really is no coming back from an exit. There won’t be a startup to fill Intel’s place. The U.S. will be completely dependent on foreign companies for the most important products on earth, and while everything may seem fine for the next five, ten, or even fifteen years, the seeds of that failure will eventually sprout, just like those 2007 seeds sprouted for Intel over the last couple of years. The only difference is that the repercussions of this failure will be catastrophic not for the U.S.’s leading semiconductor company, but for the U.S. itself.

Very well argued. It's such a stunning dereliction the US let things get to this point. We were doing the "pivot to Asia" over a decade ago but no one thought to find TSMC on a map and ask whether Intel was driving itself into the dirt? "For want of a nail the kingdom was lost" but in this case the nail is like your entire metallurgical industry outsourced to the territory you plan on fighting over.

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dfxm12 ◴[] No.45028085[source]
It's such a stunning dereliction the US let things get to this point.

It's a side effect of systemically putting short term gains ahead of long term research. CHIPs act may be too little, it is certainly too late...

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davedx ◴[] No.45028784[source]
> systemically putting short term gains ahead of long term research

That's more the stock market than the US government though. You could argue the US government tries to play a long game, and often the way the US plays that game is to let the free market decide (hands off, small government). It's definitely a valid strategy and has worked extremely well in a number of other industries, but for this specific niche, less so, and even then you could argue it's down to Intel's mismanagement than anything the government could or should have done.

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1. variadix ◴[] No.45036833{3}[source]
The strategy is fine, the problem is there aren’t enough domestic competing players in cutting edge semi nodes for it to work anymore. The US had many competing foundries before its semi industry was hollowed out by Japan and Korea. Now the only player in the US is Intel and, having been mismanaged for the last decade or more, it’s at risk.

I don’t think propping up Intel is going to work though, they’re a sinking ship and their management seems too risk averse and incompetent. It might be better for the US, long term, to let them collapse and sell off strategic parts to different domestic players (NVIDIA, AMD, micron, TI, etc) and use tariffs or other trade policy to force some amount of leading edge semi fabrication to use domestic manufacturing.