Intel Honesty | Hacker News Reader

Intel Honesty

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376 pointssurprisetalk405 comments

Intel is trapped. Its debt repayments alone are massive. The poor performance in stock has encouraged 20years of wage stagnation to the point where you can literally earn over 50% more at amd or nvidia or even an startup for equivalent roles so they aren’t hiring the best. Their pay in the Bay Area is double tsmc in taiwan for equivalent roles in raw dollar terms but the ppp differences means your better off working for tsmc in Taiwan than intel in the Bay Area. That’s not a joke. Intel are literally incapable of attracting talent from Taiwan right now.

They don’t have the talent they need and the debt trap and poor performance means a lot of push back to the needed doubling of wages to attract that talent. It’s a very hard sell for any exec trying to correct this problem. They sidelined lip bu tan who was one of the advocates for even more layoffs and wage freezes but he’s one of many backwards thinkers they need to remove. It’s going to be difficult to fix their board.

Without talent intel has no hope of winning and they can’t get that talent due to poor stock performance for the past 20years leading to executives and shareholders wishing to implement the opposite of what they need right now. In fact they have ongoing layoffs right now. A true downward spiral and the only real hope is for a newcomer to step up.

I worked there for a few years a little over a decade ago in Oregon. The wages were abysmal, so you're not wrong, but they still drew a lot of good talent because Intel was more accessible to the suburbs than the city of Portland (commuting to downtown Portland was awful) and remote options were limited. Krzanich era layoffs and the availability of more remote work options resulted in a rapid drain of talent though.

The working environment was toxic (still is based on what I've heard from folks I know working there). It encouraged working against your peers instead of with them. Top heavy management meant lots of poor choices and money burned on worthless projects that never saw the light of day. Always had the looming threat of layoffs which ate into morale. TONS of off-shoring and third-party contracts, which everyone here knows is a mess in itself. Piss-poor research before buying up smaller companies or doing joint-ventures. Pouring money into the construction of more buildings when so many of their current ones sit unoccupied. It's all just a recipe for immense failure.

I worked there on a contract while they were building a phone and had as many as six managers over six months. One of them would come in at 11, talk to me about nothing until lunch, then come back after lunch, talk more, and go home. I had to come in early to get anything done.

When I was toward the end of my project and sure I wasn’t going to try to get a blue badge I laid into someone in a meeting. It wasn’t my best moment but I had absolutely had it with this person from a competing group blocking my progress. I was on my way out anyway. I wasn’t sure if I would be fired.

The manager from the competing group sought me out the next morning to offer me a L6/L7 position. He said he wasn’t sure I had what it took until that meeting.

My group manager did the same later that day.

I made the right decision leaving.

This is a great indicator of how it's often presented as collaborative or even slightly-"woke" on the outside, when in reality, advancement is cutthroat. But conducted in an cliquey/politically repressive atmosphere where everyone is afraid to act like that, but when someone has the courage to start speaking their mind, the rest look to them as the one who can save the malaise from the stagnation.

I wonder how it became a culture so afraid of itself. How did Amazon (possibly no less "toxic", Idk) embarrassed combative disagreement and sublimated that natural emergent expression/desire during stressful situations into something that worked for the company, whereas Intel sounds like it failed to do that?

Org psychology point of view.

How did Amazon (possibly no less "toxic", Idk) embarrassed combative disagreement and sublimated that natural emergent expression/desire during stressful situations into something that worked for the company, whereas Intel sounds like it failed to do that?

All that worked (or seemed to work) for Intel for many years - 30+ years of profits and market dominance. I don't know the exact abuse level of Amazon, Microsoft, Apple or wherever but if they're equivalent, they'll keep going 'tell they stop.

The one thing toxic culture seems to do is prevent recovery when a company suffers a setback.

This is a good point. I get it probably gets ingrained, more so than a more open culture that would be open to bettering it self.

My view was Intel had a good culture until external pressures resulted in turning toxic.

I believe that any successful company is like that. There are always people that have a vested interest in pretending otherwise but that's just to avoid other people succeeding or to present a good front.

As far as I'm concerned there is no other way to get real progress; there are always a lot of pretenses on better ways to "manage" stuff but they never work because of group dynamics and basic human behavior...

So, basically -- all stick no carrot? Or am I oversimplifying :) haha ?

Your second paragraph, with a slight reworking, is a succinct diagnostic for all bloated and dying corporate entities:

"Diagnostic for immense failure. Does the organisation...

= enable a toxic working environment that is openly discussed,

= encourage internal conflict act every level, business unit and staff,

= cultivate top-heavy management, promote low-talent that makes poor choices and burns money on worthless projects that never deliver,

= maintain the threat of layoffs to destroy morale and engagement,

= send critical functions off-shore and/or to third-party contracts,

= fail to do strategic research, make poor choices in acquisitions and partnerships, and build unnecessary facilities?

If so, the patient manifests late-stage corporate morbidity."

It's grim at INTC but don't forget the CHIPS act and whatever else will follow that. The US government spends 0.5T per month - more than the market cap of all but the top 15 American companies [0] [1]

Not saying it's a good or bad idea, or that it will or won't happen - but if the US government decides to reinvent Intel, they can easily write a cheque that (if spent wisely) might do the trick.

[0] https://companiesmarketcap.com/usa/largest-companies-in-the-...

[1] https://en.wikipedia.org/wiki/United_States_federal_budget

Intel is underserving of this investment and the chips act has no teeth to ensure that they follow through and build these facilities and create jobs. They will not follow through and spend the money wisely and that was clear from the moment that bill was drafted.

> has no teeth

CHIPS act money is milestone based, and no money has yet been paid out, according to the article.

That sounds like teeth to me.

>It's grim at INTC but don't forget the CHIPS act and whatever else will follow that. ... if the US government decides to reinvent Intel, they can easily write a cheque that (if spent wisely) might do the trick.

I suspect the result of the CHIPS money going to Intel would be Starliner from Intel (btw, Starliner did meet all the development milestones set by the government, yet here we're). Rotten overbloated corporate managerial bureaucracy can digest any amount of money you throw at it, and it will make it only more rotten and overbloated.

Why doesn't the USA just buy out all of Intel's debt, let them start fresh? Call it a Silicon Era War Bond, in reverse.

Because you shouldn’t reward bad investors. Just wiping their debt without changing all of management will just result in the same problem in 10 years.

Better for Intel to sell off chunks to competent companies either voluntarily or through bankruptcy.

Because then it couldn't be a morally - now literally - bankrupt company that is nothing more than a shell of the existing company large enough that it being a complete puppet company of the neo-industrial intelligence apparatus is not a viable idea to anyone but the most extreme of Bell-end dwellers.

Socialize losses, privatize profits. How cute.

Better to help another company with better management.

Because it doesn't have a union.

I think this contains mostly correct analysis with respect to hiring experienced talent, but under emphasizes how unique each process is per company. Experience is a positive, but less positive because of it.

There is a lot of potential that could be made from newer hires combined with focused in house training/experimentation - which is what all these businesses had to do in their initial expansion - with not enough people of experience at scale available, and they probably had to do a running training ramp up multiple times over multiple generations of growth. This is in general is an underutilized strategy - esp for mature companies that need to essentially build a new generation of tech in-house.

I'm not saying you are wrong but personally I'd view the stock as an attractive perk right now since it is so low.

Whereas if I were joining a company such as Nvidia I'd honestly be kind of worried.

Historical performance isn't really a great indicator here.

You can trade your stock for intel stock when working at any company. Stock grants really should be swapped for income and reinvested how you see best. So ultimately the total take home income is what should matter for any new hire. Take the higher paying and job and buy intel stock if you believe it’ll rise.

Most stock vests over time though. I can't trade it immediately, and the value may drop between when I get the grant and when I can actually sell the shares.

He’s saying ignore the potentially worthless options and invest that extra 50% salary you earn at elsewhere in Intel stock instead of working there.

Intel stock is as high as it was 15 years ago when they had total market domination. Now they are at the brink of collapse. The market is way bigger today but still, I would take a dominant player over a failing one every day.

Another way to look at it: Intel market cap is 83B, AMD's market cap is 228B. Do you think Intel is expected to make 1/3 of the money AMD is going to make in coming decades? I see no reason to be as optimistic.

> Another way to look at it: Intel market cap is 83B, AMD's market cap is 228B. Do you think Intel is expected to make 1/3 of the money AMD is going to make in coming decades? I see no reason to be as optimistic.

Nit: market cap is not earnings. That's stock price * shares outstanding.

This year's earnings looks like this:

Intel, 3 months ended: Jun 29, 2024

> Net income (loss) (1,654)

https://www.intc.com/news-events/press-releases/detail/1704/...

AMD, 3 months ended: June 29, 2024

> Net income (loss) $ 265

https://ir.amd.com/news-events/press-releases/detail/1209/am...

So Intel lost 1654M and AMD earned 265M. This only makes your point stronger.

Intel's revenue is 54B to AMD 22B. If Intel's CPU division was spun off, I see little reason to believe AMD deserves a 3x premium to that - and you get IFS with Intel as well right now!

Granted, IFS is the millstone hanging around their neck right now, unless they can fix it.

Intel still has 75% of data center market share (for CPUs). I think this is mainly momentum and they will lose most of it in coming years.

To add to that, AMD's has the more lucrative higher-margin part of that market.

Why focus on revenue instead of income? Regardless of what Intel’s revenue is, they’re losing money. AMD is earning.

Losing money for one financial year is not a good enough indicator to draw conclusions.

Yeah but market cap is at least in theory about how much money a company is going to make in the future. Not this year, not the next year but decades is already pretty close (because of the discounting).

No it’s not. It has no theoretical relationship with future earnings at all, and even if it did, that theory would be silly.

sotck can be low because it's undervalued by the entire market and going to jump once they catch up to the future value potential, or it can be low because it accurately reflects the decline and limited value. If you only see the "attractive perk" from being so low you're the one using historical performance as the indicator, thinking Intel's only a few quarters or years away from former glory days.

Efficient market hypothesis dictates the price accurately reflects valuations. So if a stock price is down relatively, it's because the wealth of information available on it indicates its decline.

I too, used to be a dyed in the wool boglehead that believed in efficient markets. The missing small cap value / international premium over the past twenty years has me convinced otherwise today.

You raise a valid objection:

    To put the US equity outperformance of the last 15 years in perspective, US equities historically have outperformed non-US equities by 2.3 percentage points annualized since 1926 and by 2.7 percentage points in the post-WWII period. In our strategic asset allocation models for clients, we assume one percentage point of outperformance annualized [0]

Not sure this really breaks the idea of small cap vs large cap (since there's been swings and reversals in that in just the past 15 years IIRC), just the international equity differences.

Also, just going to note that 20 years is really not that long and it's reasonable for valuation swings to take that long to reverse.

[0]: https://privatewealth.goldmansachs.com/outlook/2024-isg-outl...

You would be surprised, but nvidia’s employee stock plans allow to select the purchase price within the last 2 years https://www.nvidia.com/en-us/benefits/money/espp/

> allow to select the purchase price within the last 2 years

I don't think that's true. My reading of that is "you lock in the price on your start date and can keep that for the next 2 years going forward". That doesn't help anybody joining at >$1k / share. :D (and that's only ESPP, not standard stock compensation).

Can't speak for NVIDIA but at another company I know they use the lowest price on the last 4 periods (so lowest of 8 timestamps)

ESPP is a very small amount vs RSUs. You’re limited to buying $25,000 per year (that you still have to shell out for even if it’s at a discount) vs just being given several hundred thousand (or more) in RSUs.

ESPP is completely different from stock-based compensation.

By what metric do you consider INTC to be low? I took a look because I'd be happy picking up some cheap INTC, but it still looks expensive to me.

Their revenue is >twice AMD's. If IFS disappeared they'd probably have a better valuation than they do right now solely based on processor performance, but their success in the foundry business is probably contributing negative value to their market cap (presumably because it's soaking up so much cash for nil returns)

Intel upside right now is possibly very high, if they can fix the foundry. Their current stock is pricing in complete catastrophe, rightly or wrongly (TSMC is priced at 750B mkt cap, for perspective). Yes, intel isn't as successful as TSMC right now, but only ten years ago intel foundry was better than TSMC.

I don't know where they'll go. But I feel you have much better risk/reward with intel right now.

And it seems like they don't have a whole lot to fix to be back on top or at least extremely competitive. They know how to run foundries, they just need to catch up on the tech side, it's going to take a bit of time and cash but it's not like if they don't have experience doing it previously.

On the chip design side of things, they seemed to have almost caught up (at least to AMD/Qualcomm, Apple is another story) because their upcoming low power laptop chips generation looks like it will be very competitive in terms of power per watts. And they benefit from years of refinement in the software side as well as quite competitive GPU stack, people seem to forget too easily but AMD products still have many annoyances that Intel ones just dont (recently WIFI issues on their latest laptops) and Qualcomm is a no go unless you do browser-based stuff for the most part.

I don't understand people giving up Intel for dead, because even at their worse in the past few years, they were still competitive, both in performance and price; once they figure out the process and design (seems to be on good way) I would worry a lot more about the other side of competition, but who knows...

It's trading significantly below book? $120 B vs $82 B.

Downside is that most of their assets are their fabs...

That can also mean they haven’t done asset writeoffs they should have already done in previous quarters.

If you have billions in obsolete equipment you can technically get away with not doing an asset write off so it doesn’t show in the books of current quarterly performance. Just claim it’s not actually obsolete yet. It catches up eventually though.

So the above may be more of a timebomb than a value signal. It can indicate that Intel hasn’t written off ~$40billion of assets it should have and it would seem a lot of investors are aware of this. They are already losing $10billion a quarter without counting those write off so I understand the hesitance.

I mean, I have a lot more confidence that nvidia will continue to deliver products to a market that wants to pay for them over Intel at this point in time, even if the stock is likely to come crashing back down to earth soon. As an employee, I wouldn't really factor in stock performance necessarily, but the overall image and outwardly visible struggles Intel is going through tells me the internal struggles are probably far worse than the public or shareholders know.

I think if Intel was a private company then it would have a better chance of recovery via a collection of focused experiments to overcome their biggest technical deficiencies (compared to their competitors) or to, e.g., figure out a compelling new product that the market didn't realise it needed, but that doesn't require solving difficult physics problems.

But to do this sort of thing you need a dictator at the top who is willing to risk a run of negative-profit quarters to fix the company's underlying rot. If you try to do anything like that as a leader of a public company, then shareholders tend to get angry.

I wonder if there's any lesson that could be distilled from the (minority of?) public companies that don't end up settling into a pattern of carefully-managed mediocrity. Is there a unifying theme? I haven't spent enough time thinking about this to even propose an answer other than "cult of personality around the leader" as maybe helping.

> But to do this sort of thing you need a dictator at the top who is willing to risk a run of negative-profit quarters to fix the company's underlying rot.

Private companies still have shareholders that the CEO answers to -- who tend to get angry at taking losses quarter after quarter with no clear path to growth.

I worked for Intel in the 90s.

I think the company always paid "industry standard" compared to other companies paying actually well. And it was a terrible place to work by most objective measures - people got let go quite freely, etc. When Andy Grove writes a book called "Only The Paranoid Survive", he's not committing to employee loyalty.

I think the way Intel got good people, and they did get good people, was by a combination of the opportunity to build something that gets widely used and a cult-like spirit of "are you good and tough enough to survive the bullshit".

But yeah, seems there's no recovery when that approach stops working. And it's disturbing that many of America's "crown jewels" (Intel, Boeing, etc) are basically constructed that way.

They sidelined lip bu tan who was one of the advocates for even more layoffs and wage freezes but he’s one of many backwards thinkers they need to remove.

Genuine question: why isn’t what they need large layoffs and dramatic wage increases?

Intel's debt is not bad at all. My reading has it at $53 billion. Before their revenue collapsed in the last few years that debt is only about 50% of revenue. High but manageable compared to att or warner discovery who actually have unmanageable debt. Intel's problem is that revenue is decreasing, and quickly.

Do you work in the Taiwan side of the industry?

If AAPL bought Intel could it fix it?

> in the late 2010’s Intel got stuck trying to move to 10nm, thanks in part to their reluctance to embrace the vastly more expensive EUV lithography process

TBH, it's easy to say this with the benefit of hindsight. Throughout most of the 2010s, EUV lithography was like the "year of the Linux desktop" - i.e., this year will be the year where EUV was suitable for high volume manufacturing. I don't really blame Intel for deciding to go with self-aligned quadruple patterning for 10 nm, but combining it with cobalt interconnects was probably biting off more than they could chew.

FWIW, Intel was funding EUV R&D since 1997: https://www.intel.com/pressroom/archive/releases/1997/CN0911...

That press release had an interesting prediction:

> Intel projects that the microprocessor of the year 2011 will contain one billion transistors, operating at over 10 gigahertz and delivering 100,000 MIPS (millions of instructions per second).

They weren't that far off in estimating the transistor count and MIPS: the i7-2600k released in January 2011 had 1.16 billion transistors [0] and delivered 117k MIPS [1] @ 3.4 GHz. The clock speed prediction was way off due to the failure of Dennard scaling in the early-mid 00s.

[0] https://www.anandtech.com/show/14043/upgrading-from-an-intel...

[1] https://en.wikipedia.org/wiki/Instructions_per_second#CPU_re...

So did the year of the EUV lithography happen? What year was it?

(Genuinely asking, I don't know anything about chips - I'm the kind of programmer who is profoundly comforted by pretending like my CPU is like a really fast version of the thing I did in CompE 201, as opposed to reality which i gather is a bit more like a demonically possessed stone that glues together a bunch of barely understood physics that kind of "even out" at macro levels but seem pretty f'd up at quantum levels).

2019, when TSMC N7+ entered high volume manufacturing.

OK, and in Intel's fabs? They're still not on EUV, right?

Intel 4 was their first EUV process, which entered HVM in September 2023.

Does doing an EUV chip when you already have tons of non-EUV fab take more technical wizardry than writing a huge check to ASML for the EUV machine? EUV is in the mask making step, right? Obviously your wafer fab has to be tuned to your masks but EUV lithography itself (i.e. ASML making the machine) is waaay more difficult from what I can tell.

Your description of reality made me chuckle. I remember during my degree the professor teaching us about how simple CPUs are made, but saying that the people who engineer the current hardware are like dark magicians. It can only have gotten more complicated since then.

In addition, SMIC in China managed to get to 7 nm without the use of EUV. Also early EUV yields were actually quite low.

Did SMIC get 7nm to yield or is it limping but propped up for PR purposes like Intel 7?

It's in volume production. This is what Huawei uses for its Mate 60 phones. They've sold 30 million units. From articles I've read the features on the chip are actually quite precise, which lead people to think the yield is at least decent.

How they will get to 3nm is another question but back when Intel made its decision, 7nm was on the horizon so choosing to not go the EUV route is not as dumb as it may look now.

The latter. China isn't even close to achieving high-yield 7nm.

7nm means nothing, it's an arbitrary marketing number

> Throughout most of the 2010s, EUV lithography was like the "year of the Linux desktop" - i.e., this year will be the year where EUV was suitable for high volume manufacturing.

We need to learn to recognize the difference between something that's never going to happen for either physical or economic/social/structural reasons, and something that is just really difficult and takes a long time.

I always think of this when I think about fusion and the irritating "fusion is 20 years away and always will be" meme. In reality fusion has been edging closer, and closer, and closer for decades. Like EUV lithography it's just incredibly hard and requires a ton of capital and time and some of the smartest people on Earth to make it a reality. The same logic applies to things like a working HIV vaccine, life extension, or human space flight and space settlement.

The reason there's never been a year of the Linux desktop on the other hand has to do with the full picture of what's required to mass market a desktop OS and support that, not just the technical problems, as well as business reasons around what Microsoft does to incentivize vendors to stay in their ecosystem. Linux desktops are just about ready today but no mainstream laptop/desktop PC vendor is going to sell them for a long laundry-list of non-technical or para-technical (legacy software base) reasons.

I'd say Linux desktops have been good enough for a long time, but never broke into the mainstream for the reasons you cite. ChromeOS is the closest thing I guess, but outside of schools and a few other institutional uses, Chromebooks are not very popular.

Linux is not preinstalled. There are some ThinkPads* and Dells with Ubuntu or Fedora but you need to know that.

And people how know will and must reinstall anyway Arch, Gentoo, Suse, Debian, Fedora or Ubuntu.

The Steamdeck is an excellent proof how a full featured Linux (SteamOS is based upon Arch) is shipped well. Not a unmaintained or googlyified closed-source derivate of Linux (Android and ChromeOS).

* I ordered an X13 Gen1 AMD with Linux for fun. Worked well, installation was clean. No 120$ for Microsoft and its stock owners. You shall not feed the bad guys. Especially when you will never use Windows.

Steamdeck is a gaming console not a general purpose device from the perspective of most people (yes I know it's a standard PC and completely open but that's not something most people care about). Linux is more or less just an implementation detail. Obviously not as extreme but a bit like PS4 being BSD but I don't think it's that different from Android/ChromeOS. Arch is there just to run a completely proprietary layer which is the only thing most people who use it interact with >90% of the time.

SteamDeck is only a successful by making Linux irrelevant, after all its key feature is doing Windows API translation.

SteamOS only purpose is for Valve not to pay Windows licenses.

I will consider SteamDeck a success, in games not sales, the day all top level games played on it, were actually developed for SteamOS in first place, and not Windows games running under Proton.

Correction: ThinkPad X13 *Gen3* AMD

They're pretty incredible machines for the price. I bought one a year and a half ago in an emergency, as the networking on my laptop died over the course of a few days and I needed something for browsing and email. I got the Linux dev environment set up on the Chromebook and I actually kept it instead of getting a new expensive laptop.

They are. The problem is that they are for the educational market. Especially with Google's exit from hardware, they're basically mostly cheap devices for kids. And, if you do build a nice one, you could probably get a lower-end MacBook Air for about the same price which would be almost as low-maintenance to use if you wanted it to be.

> good enough

I'm not sure. IMHO it's good enough for power users and people who don't really need much besides a browser and maybe do light office work etc. or completely fixed/define workflows. In between there is a huge gap that's quite hard to cross due too generally poor and inconsistent UX, various package installation, configuration issues and various UX patterns that are hard for many non technical people to grasp.

OTH Windows and macOS "just work". Well maybe not so much for Windows but at least it's a lot easier to find someone who can help you.

Also Linux hardly offer anything at all for this segment. If you use only your PC for gaming, office work, media creation and similar stuff what value does Linux offer you that would make it worth switching (even if Linux UX was much better than it is switching still requires significant effort and still a lot of hops to jump just to do what you already know how on Windows)? I think approximately none at all.

Chromebooks on schools is basically a US thing, in Europe most parents buy regular computers to their kids, and only top tier schools do anything beyond having a computer room class for "lets do something on the computer today".

After the Windows XP price reductions gave the first blow to the Linux netbooks market, the tablet market finished it off, for regular consumers.

Linux VMs on macOS and Windows are "The Year of Linux Desktop".

Valve sells the SteamDeck and is preparing SteamOS for use on similar handhelds available now from most major vendors.

They may not be traditional laptops or desktops, but they're PCs, and they're being sold with compatibility with a large installed base of Windows games in mind. Moreover, handheld gaming PC users seem to perceive SteamOS as being superior to Windows in this device category.

SteamDeack is a much more open equivalent of Android/ChomeOS. Yes you can use it as a Linux "Desktop" but form the perspective of most people it's just there to run a single proprietary app while Linux is just an implementation detail.

Of course some people will use it for other things than Steam but I doubt it's a very significant proportion.

> SteamDeack is a much more open equivalent of Android/ChomeOS

SteamDeck runs a minimally modified Arch Linux, with a full KDE desktop installed from the factory and prominent switch in the main UI to close Steam and reboot into a full desktop.

> it's just there to run a single proprietary app

Tens of thousands of Windows games, more like. The Steam app is just a launcher and store. Even Windows doesn't successfully run all legacy windows applications, so I think it's incredible that a successful mainstream product focused on gamers not only provides simpler user interaction than Windows gaming portables, but does so while running unmodified Windows games on Linux.

I cannot overstate the importance of Valve creating a funding stream for Wine / Proton development by doing this, hiring a boatload of Wine devs, and fostering a massive user base for testing and validation. Wine was already impressive, but it has improved leaps and bounds with Valve's efforts. This opens up the door for future cannibalization of Microsoft's share of other market segments.

There was a time when hardware support under Linux was holding it back, that time is long gone. Linux desktops and applications have developed to the point that anyone familiar with a Mac or Windows will feel reasonably at home under Gnome or KDE. Which left games and specialty Windows / Mac applications, and Valve seems to have found a way to fund knocking down that barrier.

It's a much bigger deal than another Android or ChomeOS device.

The main reason there will never be a “year of Linux on the desktop” is that desktops became irrelevant before Microsoft became… whatever it is now.

Desktops are irrelevant? Other than a few things does any actual work happen on mobile devices?

I think it would be correct to say that present-day desktops are mature and stable and aren't rapidly changing because they fill a mature niche. Mobile does seem to have decimated the casual computing and much of the non-work-related computing niche, at least for non-technical people.

I wonder if there's an argument to be made that desktops should become more technical and power user oriented since that is now their niche.

I think “year of Linux in the desktop” has always been understood to be in the context of consumer devices. Otherwise, I mean, it’s always been year of Unix on the workstation/server, right? With room to quibble in the prosumer space.

> Other than a few things does any actual work happen on mobile devices?

Outside of browsers, not much work happens on desktops either...

Another ad company?

Microsoft is now largely a public cloud company, also supporting a very healthy suite of B2B productivity tools.

Which makes the B2C ad stuff they shove into Windows all the more infuriating: it's a drop in the bucket relative to their other product verticals.

Yeah.

But like, also an ad company with no QA? Like Google is somewhat evil I think, but they are intensely competent in a way that Microsoft is not.

> a working HIV vaccine

It's worth pointing out we kind of have this now. Or, to your point, are definitely inching (a lot) closer. The lenacapavir trial results are great. From the press release https://www.gilead.com/news-and-press/press-room/press-relea...

> Gilead’s Twice-Yearly Lenacapavir Demonstrated 100% Efficacy and Superiority to Daily Truvada® for HIV Prevention

> – First Phase 3 HIV Prevention Trial Ever to Show Zero Infections

…

Never is a very long time, so I’m not going to say never. But it’s not at all certain that when all those smartest people declare victory we’ll have something that doesn’t make economic sense because the upfront capital costs are too high even if the theoretical (at that point) full lifecycle kWh cost is low.

It’s a good point, but one thing to consider is that ultra long hard tech might be structurally challenging as well. If fusion requires 100 years of capital and R&D it won’t be viable ever due to economic/societal/structural reasons.

Nobody used EUV for 10 nm though. Even 7 nm doesn't need EUV. This kind of error calls the rest into question.

Intel 10nm and TSMC 7nm are equivalent.

Intel 10 nm and TSMC 7 nm don't need EUV.

I remember seeing headlines every 18 months or so that Intel was laying off 10,000 engineers for no good reason. Made me think I didn’t want to go to work for them because I might be next.

>year of the Linux desktop

A tangent, and I realise this phrase is a meme, but it has always bothered me. Nobody has ever defined what year of the Linux desktop actually means, so it's a phrase without any real meaning.

Roughly speaking, that running Linux as a desktop OS would be easy enough that even non-technical users would be able to do it with difficulties comparable to, say, Windows XP.

Whichever for me was in 2010 when I set up Ubuntu for my grandma and put a Firefox shortcut on her desktop and she never had any issues with her computer again. Very simple use-case but it was a lot better served than by Windows Vista at the time. These days it’s even better served by an iPad though.

IME, that works as long as the user does nothing but browse the web and nothing in the environment or the computer changes. Things get tricky the moment any of those assumptions are invalidated. And that's because the user is not really operating the computer, but just using it to access the web. That it's a "desktop" is only an implementation detail.

By that metric the Year of the Linux Desktop was in 2012 with the introduction of Chromebooks.

The goal posts always seem to move.

Windows is an ugly pain in the butt to create install media for (when you're not on the native OS), and it's just as bad to Install on random hardware. Maybe more so since it's less likely to ship network drivers for random wifi gear and lan connections. Even Debian has non-free blobs for drivers with the (at least 'Live' versions) these days, finally.

Repair shops are the next big thing I hear. The goal posts always move if it isn't exactly what someone already knows.

Driver issues on Windows only happen very early in the hardware cycle. If you buy cutting edge hardware and try to install a regular/old version of Windows it might not work automagically. But it's really no big deal, not only can you load the drivers from USB just fine but you also can probably just ignore until you get to the desktop because the OS will use a generic replacement or do without in the meantime.

I know for sure because my PC was a cutting-edge HEDT at some point and indeed the network drivers weren't present at installation and GPU driver wouldn't auto-install either. But it just meant I had to right click install the network after desktop load and just download the GPU drivers from the internet.

Now that the PC is old, any re-installation is extremely straightforward with everything automatically loaded and basically zero intervention to get fully functional hardware on Windows.

The thing about Linux is that not only it wouldn't have worked at all when the hardware was cutting edge but even today, some patching and manual intervention is required for the network/motherboard that is not usual. It's a process way more involved and annoying than I ever had to do on the Windows side.

Any fool can go on the manufacturer website and download a driver bundle to execute sequentially, just figuring out what you'll need to do on Linux is a problem in itself...

>Windows is an ugly pain in the butt to create install media for (when you're not on the native OS)

That sounds like a Linux problem, not a Windows problem. Windows can create Linux boot USBs just fine.

>Maybe more so since it's less likely to ship network drivers for random wifi gear and lan connections.

Eh. IME the opposite is true. I've never seen Windows not recognize a network card, but I've on occasion had to manually install drivers for Debian for a plug-in NIC, but that years ago, now. On the other hand, very occasionally Windows needs to be spoon-fed drivers for a storage controller during installation.

Intel was also being at least a bit disingenuous in public at the time although they probably also thought they could make those frequencies work. But a very senior Intel exec told me, at the time IBM was showering them with a lot of public snark, that of course they new about the upcoming issues but Microsoft was so worried about multicore scalability that Intel had to play along.

I like the proposed approach of purchase guarantees here. Directly injecting cash into Intel just creates a moral hazard where they spend the money dealing with organizational inertia than innovating in the space. Plus, the government could even turn a profit reselling its purchased semiconductors to various US companies!

The US ecosystem badly needs a serious Intel competitor -- because they just ain't it.

The payments are tied to real milestones like building fabs. Intel cannot spend the money on organizational inertia because that wouldn't get them the money.

It doesn't matter how badly they want to sell the chips if they don't have the money to build the fabs in the first place. That's where Intel is at right now. Building fabs is incredibly expensive and they need the money upfront.

You can get a loan against the value of a purchase contract if you have a firm purchase contract (i.e. from the government) and a convincing plan on how to manufacture to that price point...

> Plus, the government could even turn a profit reselling its purchased semiconductors to various US companies!

No freaking way. How do you think that’s feasible, considering how fast depreciation goes in semiconductors?

Pork bellies also go bad but you can make money trading them. You don't even take delivery.

are you suggesting the parent comment should be considering derivatives like agricultural product futures?

Yeah. The government could pre-pay for chips to guarantee demand then auction the futures right before the chips are manufactured.

what if no one buys the futures, which is entirely possible?

Then it's a bailout.

US chip production really needs its SpaceX moment, but it seems like it will never happen, and we're left with the crumbling empire of Intel.

By "SpaceX moment", I mean a startup entering an impossible market, where the barrier to entry is billions of dollars of research and manufacturing, a market dominated by industry giants from the 60s, and yet still coming out on top somehow.

> a market dominated by industry giants from the 60s

The thing is, the SpaceX moment occurred because of a rare opportunity where the industry incumbents were insulated from any competition or need for innovation for ~30 years. Some domestic industries still operate in an environment somewhat like this (e.g. the steel industry), but still face modernized global competition (albeit whose effects are kept at bay via import tariffs reaching as high as 266%).

The semiconductor industry... while there are magnificent barriers to entry and not "enough" competition, they have absolutely not been wholly insulated from innovation or competition. And innovation in fabrication is driven at a very rapid pace! So there aren't huge outsized profits to be found like there was for SpaceX. And even SpaceX needed to invent what was almost an entirely new industry (Starlink) to become truly profitable.

And even trying to pull a "SpaceX" on domestic steel manufacturing would fall flat because you wouldn't capture the global market, and would still be dependent on some (potentially much lower) tariffs to compete against the very modernized factories in China, which are innovative/competitive/efficient, unlike our domestic industry.

SpaceX took advantage of a very rare situation where there truly was no competition or innovation anywhere on the planet for a very long period. I'm not aware of any other industries which are quite as far "behind" today as space launch systems were in 2010. But if anyone else is, please mention those industries here!

Nice analysis on competitive dynamics of semiconductor industry vs. space industry in the 2000s.

> I'm not aware of any other industries which are quite as far "behind" today as space launch systems were in 2010. But if anyone else is, please mention those industries here!

Digital payments may be in a similar situation. Visa's 2% fee may seem low but from a scale and competitive standpoint it is fairly absurd - they are making 80% gross margins on $30b of revenue to do what boils down to a few API calls and some fraud repayment. I doubt that they need to do much innovation to keep that moat either (in contrast to say Apple and their 30% cut of App Store revenues - they need to constantly stay ahead of Android and Windows).

Curious to hear your take on what other industries at least come close to the space dynamics in 2010.

From what i can see as an admitted outsider, payment rails are more complicated than they look, and most of the crypto partisans arguments to "replace" functionality are a mix of 'ignoring that part', or 'we don't want that part anyway' + a few API calls.

Problem is, the world consuming these things mostly seems to want those parts, and can't ignore those other parts. Which seems to explain relatively low uptake.

Those rails involve an amazing amount of complexity that boils down to the entire system being nonsensical.

Payments are pulled instead of pushed; the underlying credit card numbers lack even a semblance of security; there is all kinds of mis-design due to the way that restaurant tips work; it all started when credit card imprints/readers were all assumed to be offline; etc.

What do you mean "it all started..." ?

One of my earliest memories is my mum paying for groceries using her credit card in the 90/00s, where the machine used was completely mechanical/manual. It copied the card number (that was embossed on the plastic) by literally taking a carbon paper rubbing of the card. The system was designed to be offline, because back then there was no "online".

You could argue the problem was that it took a system that more-or-less worked offline, and tried to hammer it into working online.

A "built for online first" payment paradigm would look different, but it would have an enormous chicken-egg or installed-base problem, unless you had something with government-level muscle enforcing it.

That would be one of the credit card imprinters I referenced, which is offline…

I also recall the occasional business writing down credit card details, in person, with a pen, on a form they had for the purpose.

Most Czech banks offer free domestic instant payments, and many small businesses who were previously cash-only now take them as an option. I heard there's also a SEPA equivalent.

If the electronic retail payment industry hadn't already been captured by VISA and MasterCard, I could very well see something like this, a much cheaper and simpler system, being what everybody uses. There's countries (India?) where debit/credit card adoption was slow and now these simpler solutions have significant market share.

It takes (at least) two people to want to adopt a payment system. The reason American customers use credit cards is that they like them; they're very safe for customers and they have reward points.

You could pay with cash or debit if you wanted to, but then you can't chargeback the business.

Sweeden has a Swish and I am pretty sure many countries have very similar free option.

We just need a non-profit integrator to do it worldwide... Use credit card as a fallback if everything else fails.

>Visa's 2% fee may seem low but from a scale and competitive standpoint it is fairly absurd - they are making 80% gross margins on $30b of revenue to do what boils down to a few API calls and some fraud repayment.

The banks issuing Visa cards do fraud repayment. Visa gets paid for their network, and specifically their network of higher income spenders who want to play the rewards game. Also, note that Visa does not earn 2% of transaction totals. A signification portion of total card processing fees goes to the card issuing banks to pay for rewards and fraud repayment.

Exactly, the interchange fee is split between the issuing bank(largest cut), acquiring bank, and the network(smallest cut). Yet everybody acts like visa is just skimming 2% from every transaction without them getting anything in return while they have created entire lifestyles and communities around hacking credit card offers.

> to do what boils down to a few API calls

LOL @ anyone who believes that global financial processing is primarily a technical problem vs. the regulatory / bureacratic dystopia it actually is.

US Telecom is not as far behind, but it's pretty far behind. Unfortunately, I think it largely competes with cellular networks and Starlink these day.

Maybe one of the e-beam startups can pull it off. Aside from scaling issues, direct electron beam lithography ought to outperform optical lithography by many metrics, not to mention that there would never be costs associated with mask revisions.

Here’s one of them: https://multibeamcorp.com/

I remember touring a little research fab, maybe around 2000, that could achieve feature sizes comparable to what TSMC can do today. But they were very, very, very slow.

(Fast-moving electrons are easy to make, easy to aim, and have teeny tiny wavelengths that entirely sidestep most the issues that people have with photons having obnoxiously large wavelengths. But electrons have all manner of downsides that explain why fabs spend many billions of dollars on optical lithography, one of which is that they repel each other, which makes shining a lot of them at a wafer at once quite problematic.)

>By "SpaceX moment", I mean a startup entering an impossible market,

I think semiconductors is a difficult space for a SpaceX. SpaceX was relatively cheap - the company itself only raised 2 billion dollars, and according to Musk, the cost to develop Falcoln Heavy was "only" $500M. I think the "thesis" behind SpaceX is moreso that the technology to develop rockets had come down massively, but the market had gotten fat and lazy on government contracts. The market only seemed impossible because everyone just assumed so.

On the other hand ASML's EUV machine costs $300M and that's only a small part of what you need build your own Fab and barring some massive research breakthrough that isn't coming down any time soon.

The semi spacex moment already happened - it was when TSMC was founded

That's such a good insight. It really was the SpaceX moment or maybe we can say SpaceX was the TSMC moment of space since TSMC came first.

1987?

As near as I can tell there was nothing particularly remarkable about TSMC in the 1980s or 1990s.

20 years for a hardware startup to get really going isn't unusual. One of the other reasons VC likes SAAS. Hardware startups are cash intensive and slow boils, typically.

They weren't a startup for 20 years, they were a huge company with billion dollar fabs, thousands of workers, and they were exchanging technology lead with other silicon manufacturing companies many times (back before 2020s, mid/late 2010s, TSMC was not undisputed leader).

UMC was a Taiwan foundry that started even before TSMC and it eventually folded.

>UMC was a Taiwan foundry that started even before TSMC and it eventually folded.

What are you even talking about...

Same thing as everybody else in this thread, leading edge logic market.

Wasn't AMD or even Intel the same sort of "startups"?

Also what's so special about TSMC?

I mean they were doing quite well in the 90s and early 2000s before falling back behind Intel before they caught up and surpassed it this time.

Maybe the more generic claim is 'when pure-play foundry companies started earning more money than the "integrated device manufacturer" companies')

https://en.m.wikipedia.org/wiki/Foundry_model

Tesla and SpaceX both took time before they started generating positive cashflow.

It was one of the first foundries that focused on external ip and not producing its own chips

Or maybe Intel itself? AMD? Nvidia?

TSMC has been spending $15 - $50 billion per year for years to stay on top.

Estimates are it would take $200 - $300 billion just to catch up with them and little to no profitability for a decade while burning $10s of billions every year.

I think the federal govt is the only entity that has that kind of money.

I think the issue is that TSMC exists, which takes up a lot of oxygen and opportunity. Whereas in space, there wasn't a high quality opportunity, so SpaceX had a lower hurdle to being the best (even though that still wasn't easy!).

Indeed, but downplaying the strategic threat to Taiwan as a "short-term" potential impact is not a credible position in the long term.

It is prudent, possibly even critical, to have foundries on US shores, and the US will have to pay for it.

Chip production seems another order of magnitude more expensive than space travel, when you look at tens of billions for a fab, but also several orders of magnitude more productive.

I think rockets are insanely simple compared to silicon. The amount of research and development it takes to build a light source (hot tin plasma[1]) is extraordinary, and fabs are also probably the most complicated manufacturing facilities in the world. Tesla struggled mightily with integrating disparate auto parts manufacturers some years ago.

SpaceX and Tesla benefited from being helmed by a crazy person (in their nascent stages), who pushed to break norms in the conventional thinking, either "rockets can't be reused/we must spend $10B on a test campaign[2] before any part leaves the ground" and "EVs aren't cool". I don't think if Musk could design a rocket engine from scratch is relevant, but the strategic design patterns of 1) reduce requirements, 2) remove unused things, 3) simplify/optimize, 4) accelerate cycle times, 5) automate. Those points aren't revolutionary, just a more expanded "go fast and break things."

The computers that came out of Silicon Valley in the late 70s-into the 80s were a disruption to the old stalwarts like IBM. Though for silicon maybe I'm just trapped in that pre-SpaceX thinking.

[1]: https://phys.org/news/2020-05-exceptional-euv-hot-tin-plasma...

[2]: https://www.planetary.org/space-policy/cost-of-sls-and-orion

There's another light source that isn't nearly as hard and actually delivers better quality light at far higher electrical efficiency... It's just large and most of the cost is in the large machine that's kept under vacuum. GloFo was working on doing EUV with that (they gave up on EUV), and Japan was or is recently working on a small demonstrator fab with iirc about 10 steppers, starting with the light source machine.

That machine btw is called "free electron laser", and utilizes relativistic electrons to match their velocity to free-space photons instead of the slowed-down-by-metal-helix traveling-wave-tube-amplifiers that power most TV satellites. Those work at about 10 GHz or 30mm wavelength, much larger than the 13nm band used for EUV lithography.

FELs can have efficiencies in the double digit % if built with energy recovery, btw.

> The computers that came out of Silicon Valley in the late 70s-into the 80s were a disruption to the old stalwarts like IBM. Though for silicon maybe I'm just trapped in that pre-SpaceX thinking.

another good example of this is how VLSI in particular disrupted the mini-computer/mainframe market and made CPU's cheap enough to put them into smaller and far cheaper machines. This really shook up the old guys who where used to being total system vendors. (IBM, DEC etc). Suddenly, you could get a computer for much cheaper compared to the decade prior, and by the early to mid nineties you had guys like sun eating their lunch completely.

IBM pivoted to being a services company and DEC just imploded.

AFAIK IBM still completely dominates mainframe, so they're not entirely out of the systems space.

I think lack of focus on US domestic chip capability is semi-intentional and is an eventuality. Semiconductor industry, and many other manufacturing industries too, seem to flourish at very outer edges of the free world.

It could be simple as the free world not wanting manufacturing capability at home. It could be wanting only grain farms and money printers.

Manufacturing in the west is expensive compared to cheaper developing countries.

Also, manufacturing has a massive impact on the environment, this includes semiconductor manufacturing. It has politically been impopular for a while now.

Because of the resource curse - everything that isn't the best cost/benefit ratio to a country tends to become unworkably expensive. The USA's cursed resource is money - literally - it prints the world reserve currency.

> By "SpaceX moment", I mean a startup entering an impossible market, where the barrier to entry is billions of dollars of research and manufacturing, a market dominated by industry giants from the 60s, and yet still coming out on top somehow.

This already happened and the startup was TSMC. Unfortunately for the U.S., it's in Taiwan.

> By "SpaceX moment", I mean a startup entering an impossible market

SpaceX entered a market with hardly any competition (due to little demand) and is/was extremely reliant on government funding anyway.

Semiconductors are highly competitive and you can't rely on government agencies buying most of what you manufacture.

I'd argue Tesla might be much more closer to "startup entering an (somewhat)impossible market" considering how entrenched non Chinese car makers it was and how hard it was to survive in and especially start from scratch as a small company.

TSMC would likely never let itself be bought by a Western company. It's too vital to Taiwan's (and China's interest). The best that can be hoped is its ethical engagement with US chip players in decline.

But surely it wouldn't be impossible, with enough capital and initiative, to start a US-side TSMC clone on US soil? Just like the Valley successes of the 70s and 80s prompted savvy Taiwanese investors to found TSMC. We might need to start copying back some of their playbook to chart our own course to success, as they did with ours, then exceeded it with their out strategy and ingenuity, currently.

I don't know geopolitics well enough to know the answer to this. Is losing TSMC an existential risk to Taiwan?

Existential depends on perspective, but TSMC is a strategic asset. Any loss of it would lead to TW losing significant leverage and being more vulnerable to external pressures.

I generally like Stratechery but this is not up to the usual standard.

To the extent that CISC means anything it means “backwards compatible”. Modern ARM cores have multi-step decode and issue: to the extent that RISC means anything it means “we developed this with twenty year’s hindsight so we don’t have to do a lot in microcode yet.” In die area, in TDP, in wafer consumption, it’s just not a big cost.

To the extent that Intel missed AI so did everyone: right now there’s one target and that’s NVIDIA, no amount of HBM/TC ratio tuning is going to change that. Like 3 of 17 Ray/Anyscale tutorials target Habana. The Gaudi stuff works fine if you’re willing to pay the “last year’s model” tax all non-CUDA does.

And bigger picture, on semiconductors it’s the geopolitics people who are watching the bright line: semiconductors are a major power arena, the markets will get adjusted along those lines.

> In die area, in TDP, in wafer consumption, it’s just not a big cost.

And yet we live in a world where an AI 370 processor has less than 1/4 of the single-threaded perf/w of a “totally equivalent” M3 Max processor. One of those things can’t be true.

Who are you going to believe, Jim Keller or your lying eyes?

And it only gets worse when you realize that he didn’t vaguely say the thing people claim he said… people have spent 4 years now arguing against observable reality using a quotation from Keller that he didn’t even make lol.

I find it amusing that it was the off-the-scales "SoC" people at Apple who pioneered the new best paradigm for vector compute. Not surprising mind you, the PA Semi people are terrifying, Apple is one of the best microarchitecture firms in history.

I find this amusing because we still call them "GPU"s. NVIDIA's revenue is like 85-90% datacenter IIRC, gaming is like, anti-trust insurance or something.

The "low end" just almost always eats the "high end".

Sidequest:

“I’m going to do Windows and then I’m going to do Windows Mobile and I’m going to do Windows embedded.” (all on intel x86)

As someone who worked on Windows Mobile and Windows Embedded, it's funny because that's what management was hoping, but it was so different. I don't think any of the phones had an x86 chip in them, although that was our debugging setup so we could use vastly more powerful desktop machines as devkits (although we still had devices to). Having to port parts of Windows to ARM and even MIPS was a giant PITA.

Windows Embedded is closer since it was based on XP, but also a completely different branch from what I remember from Win Mobile.

A lot of people think it's easy to port things, and hard to write things. With really, really complicated software, it's still really hard just to port things.

> today AMD has both better designs and, thanks to the fact they fab their chips at TSMC, better processes

On paper AMD is better, but in the scientific community, it seems that Intel has much better performance for things like NumPy and SciPy. The reason seems to be "Intel® MKL" (https://en.wikipedia.org/wiki/Math_Kernel_Library).

I'm using a lot of weasel words like "seems to" because I haven't rigorously proved it. But anecdotally, my company's AI pipelines which are NumPy/SciPy heavy run an order of magnitude faster (2 seconds vs. 20 seconds) on my laptop's Intel i7 than the do on my Ryzen 7, despite the Ryzen 7 being a newer gen than the i7.

MKL detects non-Intel processors and uses a slow code path.

Indeed, and ignores the CPU feature flags for things like AVX2.

There is various hacks, some to the binary (to edit out the if <AMD> then slow) or even just ENV flags. This fixes things like matlab's use of MKL and shows a significant performance increase.

> But anecdotally, my company's AI pipelines which are NumPy/SciPy heavy run an order of magnitude faster (2 seconds vs. 20 seconds) on my laptop's Intel i7 than the do on my Ryzen 7, despite the Ryzen 7 being a newer gen than the i7.

I very very seriously doubt this is a like-for-like comparison. I suspect one case is multithreaded and the other not, or that one is using generic non-SIMD fallbacks or something like that.

All I know is, when I run `python3 ai_script.py`, it's much slower if I invoke that command on my Ryzen 7 desktop PC vs. my i7 laptop. I briefly profiled it once, and it seemed like `skimage.measure.label` ran much slower on AMD.

The Altera merger pain is maybe enlightening.

Altera 10-series FPGAs were massively delayed due to Intel's 10 nm fab problems. But I speculate that there was also a big difference in toolchains, does anyone know for sure? I mean Altera was using TSMC previously, and I presume were using industry standard tools: Cadance / Synopsis. But I would guess Intel was running their fab on home-grown tools... what is the status these days? For example I know for sure that IBM's synthesis was "Booledozer".

It's interesting because maybe Intel will spin out the fab business. But are they immediately ready to become a commercial fab business instead an Intel-only business? What's the toolchain like for Intel fab?

The Altera merger was a perfect storm. I could write for pages about what went wrong. But here's a few key things: First FPGA companies have been massively hit and miss with their product - they were perfectly capable of screwing up their next chip all on their own (it's a mutually beneficial duolopy of crapness with Xilinx). Second, when Altera agreed to fab with Intel the deal was written such that Intel could never buy any FPGA company other than Altera, so from day 1 this wasn't "Let's produce this together" it was "Let's line up Intel to buy Altera" and so Altera never had to deliver anything, they just had to wait for the acquisition. Third, Altera were one of Intel's first customers and it turns out that Intel's fab process couldn't make some of the gates that Altera needed, which is why in the end they partitioned off the entirety of the transcievers to a separate tile fab'd by TSMC and sellotaped to the edge of the Stratix 10.

Also just to check your facts on the 10nm fab problems. Intel's first FPGA for Altera was always planned to be 14nm. It was totally trash for reasons entirely within Altera's control (don't rock the boat, just wait for the acquisition to close). And the synergistic products were a dead end. I'm sure the 10nm catastrophe didn't help but really that time would've been well spent unpicking the disaster of Stratix 10.

Oh right, 14 nm.. it was so long ago now :-)

Also I assume that both AMD and Intel bought FPGA companies for FPGA co-processor acceleration opportunities. I don't think this has panned out.. I know Microsoft has their bing FPGA accelerator, but I don't think FPGAs have made any dent in the AI space, and are certainly not essential in any of the hyperscalers. Maybe AMD will sell Xilinx at some point.

>they partitioned off the entirety of the transceivers to a separate tile fab'd by TSMC and sellotaped to the edge of the Stratix 10

awesome.. I could imagine it was too risky to redesign the transceivers.

Historically Intel did use non-standard EDA tools which is one reason they had trouble getting outside customers onto 10 nm (besides the fact that 10 nm didn't work). Some Intel acquisitions like Fulcrum and Barefoot never used Intel fabs.

I think they're supporting a more standard toolchain starting with 18A.

I see, this is their newest node or close to it.

https://www.anandtech.com/show/21504/intel-18a-status-update...

"For Intel, getting an external PDK out for a leading-edge process node is no small feat, as the company has spent decades operating its fabs for the benefit of its internal product design teams. A useful PDK for external customers – and really, a useful fab environment altogether – not only needs process nodes that stick to their specifications rather than making bespoke adjustments, but it means that Intel needs to document and define all of this in a useful, industry standard fashion. One of the major failings of Intel’s previous efforts to get into the contract foundry business, besides being half-hearted efforts overall, is that they didn’t author PDKs that external companies could easily use. "

But some bad news today:

https://www.reuters.com/technology/intel-manufacturing-busin...

In June 2021, Gelsinger named 22-year Intel vet Sandra Rivera to head up a new Datacenter and AI Group. Rivera, who spent two years as Intel’s chief people officer before taking on her new role, describes what Intel staffers are looking to get out of their relationship with the company, using terms that would have been unlikely to come up in its original heyday. “For sure, we are in an age now where our employees are looking for a deeper, richer connection to the purpose of the organization,” she says. “They care about diversity, equity, inclusion. They care about the planet.”

That does not sound like the constructive confrontation of intels heyday.

The geopolitical bit of all this is the real wild card. No one really knows what's going to happen there.

The geopolitical bit is that TSMC is building local US and EU fabs in case of a Taiwan invasion. Once those are up and Intel becomes redundant the ad hoc subsidies might just dry up.

Sure, but "is building" could be very far from "is able to smoothly switch production if the main plants and some/many of the associated people are war casualties"

I have to wonder if a TSMC-owned fab in Phoenix is still a different geopolitical risk factor than an Intel-owned one.

It reduces the deterrence factor of the TSMC facilities on Taiwan: if they get damaged or sabotaged during an invasion, the entire industry doesn't get blown back to 2010. But now I'm imagining they'd have a board of directors having to meet overseas and claim their legitimacy to trading partners, almost like the "governments in exile" during wars.

Yeah, you've got Apple, Nvidia and AMD heavily exposed to that geopolitical risk, but seemingly not willing to help lessen it by investing in US fabs. Whenever I note this people here and elsewhere say "they're smart to be fabless" but somebody's gotta run fabs and more fabs need to be run in the US and quickly. I realize industrial policy isn't in vogue these days but it might be a good idea for the future of US semiconductor production to arrange some marriages between some of these companies that have a lot of capital and have a lot of need to reduce their geopolitical risk. Our brand of capitalism isn't great at looking ahead more than a quarter or two.

Apple is heavily invested in the new TSMC fab in the US east of the north end of Phoenix, last i read; not sure how arranged that marriage really is, but perhaps tax incentives for TSMC facilitated Apple plans to heavily utilize it.

(trying to find linkable articles...like this

https://www.theverge.com/2022/12/6/23497417/apple-tsmc-phoen...

) ; p.s. i wonder if only i compulsively balance lisp parens

I thought historically companies always wanted "second sources" for things like this.

Surely all the fabless semis can't be blithely running off a cliff with TSMC as their only parts source? That would be a catastrophic risk to take down the track if there's only a single vendor for advanced chips and they've decided to hike prices and collect all of the benefits alone from their advanced processes and share none of them with their customers.

Buyers will obviously always want more sellers. That is not a sufficient condition for sellers to exist, however.

Selling what TSMC sells might not be easily reproducible.

As it currently stands, it is reproducible. In 5 years, it might not be, if Samsung/Intel throw in the towel.

I don't really see that happening yet, but at some point if TSMC maintains its lead and the alternative options don't get the sales to continue investing, TSMC could well become completely unassailable at the leading edge.

Globalisation in peace time happened, and everyone thought we would just be a group of friends across the globe, with occasional hotspots here and there.

Turns out, yet again we failed to learn from history of past civilizations.

Apple could invest in an Intel Foundry spinoff, but there is no reason to invest in the Intel of today.

Less so that thought. TSMC is Chinese via it being Taiwanese. No disparagement of regional uniqueness or actual ownership, just its success is a success of the Chinese people (into which Taiwanese are included). China will not substantially harm TSMC when it is so successful at destroying American dominance in a key industry. Taiwan and China are very much aligned when it comes to TSMC.

Maintaining a US native foundry might actually be a way to prevent war because one of the key triggers might be the moment where all major chip players totally depend on TSMC, which gives Chinese/Taiwanese massive leverage. Economically, might be a loss leader. But strategically, important, probably.

Not a trade lawyer but as I understand it, WTO treaty obligations specifically forbid the kind of purchase guarantees that Ben's arguing for here. Part of the whole point of the WTO is to to pull up the ladder and prevent countries from doing what Japan, South Korea, and Taiwan successfully did to become rich. So this kind of support for domestic manufacturers is not allowed

The OP makes a compelling case that Intel's foundry operations have fallen so far behind that they are no longer economically viable on their own, in the face of current market forces, i.e., Intel's foundry business may not be able to earn a positive return on the tens of billions of dollars of capex now required to catch up with TSMC.

If the US truly views having a domestic foundry as critical to national security, the US federal government has no choice but to pay up big time to support Intel's foundry business until -- hopefully, eventually -- that business is able to compete profitably against TSMC to manufacture chips for Apple, Nvidia, AMD, etc.

Oh, how the mighty have fallen!

Also, unlike TSMC, which the taiwainese goverment sees as a national asset and which actually garuantees them economic co-dependence with the west and thus independance from china,t he US seems to have forgotten that having your own manufacturing capability is very important for national security.

They aren't competitive right this moment, I suppose. Is that a reason to completely give up on all of the embedded knowledge inside the Intel IFS organisation?

Surely at some point you can make the argument that it's worth the investment for possible returns in the future, even if it costs a crazy amount of money right now. Trying to replicate what Intel has as another player would be even more exorbitant, presumably.

There are a slew of foundries in the US already that aren't intel and are open to manufacturing for non-intel products. For example, Global Foundries.

I just don't see what benefit at this point the US government would see investing in intel when they aren't really a whole lot better at the game at this point vs pretty much anyone else.

Intel is a decade ahead of other US foundries.

I’ve heard the theory that Intel is physically incapable of doing the lithography transition they need to do without missing at least one full release cycle. Which should be bad news but shouldn’t be existential.

The theory goes that any CEO who does the necessary thing will be fired, so either they won’t do it, or the board will replace them with someone who won’t do it.

That kind of market failure can destroy arbitrary value.

They skipped a release cycle with 14th gen (it's the same as 13th gen) and the lithography transition is basically finished already. It looks like Intel 18A will come out before TSMC N2.

I hope you’re right, I’m not an Intel fanboy but when they hit a high note it’s usually pretty good, and we like competition.

I had a 12900K that was one of my favorite chips in ages but nothing since then has looked appealing.

Brutal. Intel processors will be the equivalent of government cheese. Not what anyone wants, but it's what you get with your government dollars.

I see the semiconductor industry becoming a bit like the auto industry. A geopolitical pawn, heavily dependent on subsidies and in turmoil due to market forces (switch to electric in cars vs. switch to ARM/RISC in semiconductors)

To be clear, the outcome we actually need here is a bulwark against the possibility of China eventually being the world's only producer of leading-edge chips.

I never thought of it that way. Are they going the way of Raythoen/Boeing?

Did I misunderstand or did the author advocate a world where the only high-end chip manufacturer in the entire world is TMSC?

Just the one single company, located in a politically unstable area?

And putting aside the politics, if they become a monopoly what do you think will happen next?

Purely from the perspective of Intel and their shareholders it makes sense. But it's obviously a terrible idea for the world at large. TSMC and ASML need US based alternatives.

Intel was getting something like $20 billion from the CHIPS act - but it seems like by the time the fabs would have been ready TSMC will already have them beat to 1.4nm/a14 (also using High NA EUV). Intel has just consistently failed to execute whereas TSMC has been fairly close to schedule.

I wonder if Global Foundries will become relevant again on the high end. They “gave up,” but they are working on some pretty small nodes now, 12nm, obviously not what TSMC is up to, but maybe they’ll catch Intel in 10 years. I’m sure they are fine for automotive.

They’re 4-5 nodes behind Intel today, with no EUV machines let alone High NA EUV. They’re just not relevant in leading edge in the slightest.

I'm still hopeful of the fact that Intel is, in many aspects "too big to fail", and with their cash on hand, they have enough of a burn rate to turn this ship around, even if they aren't being as intense on cutbacks as they should be.

The question remains, will Intel survive in its current form or could an activist investor stir up a hostile takeover and change the calculus?

On the other hand, Intel is small enough to rescue. $82bn (market cap) is not the amount of money it used to be.

From the article, “William Shockley, one of the inventors of the transistor at Bell Labs”.

William Shockley did not invent the transistor in 1947. He was not on the patent and was in Europe at the time of the invention. John Bardeen and Walter Brattain were on the patent. Shockley shared the Nobel Prize due to work in 1948 on the transistor effect.

Source: https://www.electronicdesign.com/technologies/analog/article...

I'm not sure if I buy the thesis entirely (that thesis most aptly being: "Gelsinger does have one fatal flaw: he still believes in Intel, and I no longer do.")

The biggest reason is geopolitics: If escalated confrontation happens with China, Intel becomes one of the most valuable companies on the planet, period. TSMC will finish western fabs eventually, but the delta-t on when they become competitive (tech, capacity & cost, remember) with even Intel's western fabs is... decades, plural? Maybe never? The CHIPS act helped, but TSMC is dragging their feet for very, very (existentially) good reason. Also, remember that TSMC is built entirely on the back of ASML; conflict with China doesn't just block the west's access to the east's fab capacity, it blocks the east's access to the west's tooling to build more and better fabs. TSMC craters in this scenario. Samsung also exists. That's the list of near-SotA fab capacity, globally.

Capacity is another good reason: TSMC is not a bottomless bucket, and every year for the past at least two years Apple has purchased 100% of their SotA fab capacity. No one is competing with Apple's margins (except Nvidia, but that's a bubble market; numbered days). His argument is that there's no market reason for Intel's fabs to exist; we don't have the data to say for certain, but I'd guess that if Intel went to TSMC and said "you're already making lunar lake, make our xeon chips too" TSMC would say "we can't" (especially on SotA nodes, but maybe even near-SotA). They're tapped out, they grow, they're instantly tapped out again, everyone wants what they're selling. Intel fabs Lunar Lake and Arc with TSMC; both very-low volume.

Also worth keeping in mind: Intel was at one time the global leader in chip fabrication; but they lost that crown. People view TSMC as this unassailable beast, but they're just as fallible; and when I hear people say "Well, Intel 18A is probably three years out and by that time we'll have TSMC N2P with backside power delivery so who will even care about Intel 18A" are just extrapolating history. That's a dangerous game when all these rankings and valuations are based on asymptotically approaching the limits of the laws of physics. And while it is unlikely that Intel will take the lead again, TSMC showing any sign of faltering will raise the relative value of the #2 companies.

Intel is not in a good spot, but they're still an interesting business, they're still designing some of the best chips on the planet, and with the right decisions could grow to be even better than interesting. IMO, this article is missing a lot of the hard analysis and data that Stratechery is usually known for; I don't feel you can have a researched discussion on Intel without talking about fabrication volume or their concerning levels of debt, but he didn't mention either of those things. Heck, more than one passing mention of China feels kinda important to the topic.

> remember that TSMC is built entirely on the back of ASML;

Probably a few people east of the Netherlands have noticed and are doing something about it.

That's not the only thing you have to replace. ASML has layers of sole suppliers themselves, like Zeiss who make their lenses.

EUV itself was developed by US government labs; ASML is a sole supplier of it because we licensed it to them and refused to give it to Nikon/Canon for no good reason.

> The biggest reason is geopolitics: If escalated confrontation happens with China

If escalated confrontation happens with China, and that is massive IF that is dependent on insanely belligerent action from the West like giving nukes to Taiwan, then new semiconductor manufacturing will be the least of our worries. A Chinese blockade on Chinese and East Asian exports to US would result in total economic collapse in USA over a relatively short period. $100,000,000,000s in real demand for goods no longer being met over the span of weeks.

The possibility of direct conflict with China is the domain of armchair strategists that consume too many Reddit headlines, Peter Zeihan, Economist, etc., and individuals directly downstream of the defense budget, where Threat Inflation is good business. It's really not something that serious, intelligent people are anticipating on the horizon (again, outside of the wildcard of an insane new administration in Washington). Even the insane combo of Matt Pottinger, Mike Pompeo, John Bolton didn't get close to manifesting it (allegedly, some of their attempts were undermined by backchannel diplomacy from Gen. Milley and the JSOC). So what's the real risk?

There are a thousand different ways that "escalated confrontation" with China can fall short of "direct conflict" while still negatively impacting TSMC's ability to allocate production to the west. That's why I said "escalated confrontation". If the only ways you can think of it happening is what Zeihan says, then that's simply a failure of your own creativity.

One moderately realistic one: Taiwan experiences something similar to what happened in Hong Kong, during a time when US leadership is not motivated to aid in its defense. This isn't a situation where China and the US are at war; we're still trading with China; and broadly speaking the economies of both countries are fine. But, Taiwan isn't, and whether it surfaces as key TSMC talent/tech leaving the country, military action, or just PRC subtly shifting TSMC's allocation priorities toward the homeland: western chip manufacturers could benefit. This isn't seemingly likely to happen in the next four years given the stated priorities of both sides of the political isle; but the right is shifting more-and-more isolationist every year, and no one arguing in good faith would speak with such certainty as you have on what happens 2028 and onward.

While I agree that a full blown confrontation with China is unlikely (although I do think the probability of it is nowhere near 0), I think your thinking is kind of flawed too. Why would there be a total economic collapse ?

What are the strategically important things imported from China that US couldn't live without, and that couldn't switch to importing from eslewhere or manufacturing at home, in times of war ?

My understanding is that US would is importing a lot of non critical things, whereas China is much more dependent on importing critical commodities (food, oil).

> that is dependent on insanely belligerent action from the West like giving nukes to Taiwan

The USA administration has stated several times that they would defend Taiwan if China invaded (see for example [1]). Would you consider that an "insanely belligerent action from the West"?

You can argue that China is not going to invade any time soon, but I wouldn't consider the probability negligible.

[1] https://thediplomat.com/2024/06/what-to-make-of-bidens-lates...

>(allegedly, some of their attempts were undermined by backchannel diplomacy from Gen. Milley and the JSOC)

Did you mean JCS (Joint Chiefs of Staff)?

Yes

And the news just keep getting "better" [1]

[1] https://finance.yahoo.com/news/intel-just-gave-plan-laid-213...

Intel has been talking about the monumental shift that its 20A node will bring for years, but we'll never see it in action.

I'm sure all the points are correct but the assessment for ways forward being to just use TSMC as the manufacturer completely ignores the somewhat perilous position Taiwan is in with a looming Chinese invasion. I'd be very reluctant to tie the future of my business to the fates of a company that may become state property within a year or two.

Intel has $29B cash on hand. Their new fabs are being subsidized. Sure, American labor is more expensive than APAC, but I don't see that being a huge differentiator in such an automated manufacturing segment.

My personal rabbit-hole conspiracy is that AI is driving a fire under the national security apparatus, and we're going to see a restriction on AI-chip technology being exported or manufactured overseas. Intel will be in prime position to onshore that manufacturing.

$29b cash and about $50b in debt. They have a valid business still, but I think you're under appreciating how much of a hole they need to dig themselves out of.

Their current foundries can't just make other chips, and they certainly can't make GPUs for AI (TSMC make Intel GPUs). They are making a new foundry in Ohio, but in Intel's current state and comments they've made to the market it's not guaranteed the foundry will be built.

Intel might make it out of the hole, but it's going to get worse before it gets better. At their current trajectory their is not valid reason for the company to have 100,000 employees. I expect the recent layoffs are the first of a few.

> $29b cash and about $50b in debt.

I know nothing about finance, but I have trouble figuring out how they got themselves into this situation given this https://www.intc.com/stock-info/dividends-and-buybacks :

    As of June 29th, 2024, we were authorized to repurchase up to $110.0 billion, of which $7.24 billion remain available. We have repurchased 5.77 billion shares at a cost of $152.05 billion since the program began in 1990.

Had they not bought there own shares they would be sitting on $70B cash and no debt.

> I have trouble figuring out how they got themselves into this situation

That's easy. This is the thinking process:

By buying shared at that time, we increase the stock price and please Wall Street. I get a bonus. Not investing into R&D might cause some problems in the future, but we are Intel. We are #1. When there is a competition, we will just redirect money to R&D and zoom right past it. Plus I will likely be gone by that time anyway.

Because debt was cheap. Easy to keep it on balance sheet a few % rather than give it to shareholders.

Remember, for the decade before this point INTC was throwing off 20B+ profits every year. They've had a couple of bad results recently, and everyone is ready to throw them off a cliff.

People are, in general, very sensitive to the most recent news when it comes to stocks. They will extrapolate what happened over the last year out into the next decade and say X is dead or X is going to rule the world (Intel, Nvidia respectively).

How often do business reclaim the top spot?

The pessimism is because Intel is behind by tens of billions of dollars, and more importantly, years. Many years. Effecting management change and developing the right workforce with the right expertise is not a given, even if they were previously earning $20B net income per year.

One could easily say this is the business with the highest barriers to entry in the world (hence the highest profit margins and profits in the world).

Yea, Intel is more than 50 years old, they’re a mature player in decline. They look more like IBM than Apple.

Yea, and all that debt did was delay the pain that they are experiencing now, while putting the company in a far worse position to try fix itself.

Ouuuuch. There oughta (still) be a law.

What happens to the computer and tech industry if Intel fails?

The x86 licence still has value to some others in the space, but it seems like Intel could potentially be sold off for parts if it can't sell correct.

ARM wins the instruction set wars and buys the tech. Future ARM processors will have x86 hardware that offers compatibility with legacy software. Eventually the instruction set is forgotten.

Got me thinking, from what I've read, modern high-performance cores do a lot of similar tricks and translate everything to uops anyway.

How hard would it be for say AMD to make a performant dual-ISA CPU?

I was thinking somewhat like how virtual 8086 mode[1] worked on 32bit CPUs, ie OS could be ARM-based, but it could run x86 processes.

I assume it would be hard to not sacrifice performance for one of the ISAs, but if it's for legacy applications you wouldn't need top speed necessarily.

Are ARM and x86 just too different to make it work? Are there other obstacles?

[1]: https://en.wikipedia.org/wiki/Virtual_8086_mode

> Got me thinking, from what I've read, modern high-performance cores do a lot of similar tricks and translate everything to uops anyway.

It's not really true. The uops are highly related to the input instructions. There's enough room in a big desktop CPU to fit a big complex decoder yes, but it's a waste of space you could be using for other things, namely even more caches.

But the main reason not to do it is that you can do emulation or recompilation in software instead.

Why/how would the death of Intel kill off AMD too?

IBM still sells CPUs based on the PowerPC (now Power ISA) architecture. AMD doesn’t need to die for x86 to become irrelevant.

But Intel does? Or are you saying x86 becomes irrelevant no matter what?

As another commenter pointed out, AMD owns the x86_64 patents. The original x86 patents have long since expired already, and the x64 patents should be expiring soon as well. The ones listed on Wikipedia have already expired[0] but it is not clear how many extensions are needed to run most modern x64 binaries and if they can be easily emulated via another extension or through microcode. (if that is even allowed).

[0] https://en.wikipedia.org/wiki/X86-64#Licensing

(From the above link, US6889312B1 actually had its patents mistakenly transferred to Philips which seemingly went unnoticed for 18 years)

Not sure how much x86 is actually worth considering x86-64 is owned by AMD

They are building a huge fab in Ohio but I don't see Intel as a going concern that will be around at the date of completion. I fully expect the project to be abandoned.

yeah intel's foundry business might not be competitive in the short term. but it's better than nothing. they can focus on other industries that don't need high performance / for low power.

because if you yield the whole thing to tsmc. you won't be able to recover the expertise, which is catastrophic for both intel / USA.

agree. You need to get scrappy and back to basics. Create an internal startup that can act as a seed to rebuild their whole foundry business from the ground up. An incubator to nurture latent capacity and future potential.

Capacity building here has to be a long term play.

Anyone else notice how many typos are in this article? Does no one proofread anymore?

>Their pay in the Bay Area is double tsmc in taiwan for equivalent roles in raw dollar terms but the ppp differences means your better off working for tsmc in Taiwan than intel in the Bay Area. That’s not a joke. Intel are literally incapable of attracting talent from Taiwan right now.

There's some whiplash in hearing constantly how the US is a corporate-dominated oligarchy, and then also seeing trillion-dollar industries at the forefront of the global economy constantly getting their shit rocked by a few dozen NIMBY retirees at city council meetings.

We detached this subthread from https://news.ycombinator.com/item?id=41448341.

Some of the issues are way downstream of those NIMBYs:

Non-housing costs are quite low in Taiwan. Food and childcare, in particular, are so much cheaper than California that it’s hard to believe.

But the NIMBYs aren’t totally in the clear. Rental housing with 3+ bedrooms (for families) is severely lacking in much of the US. Maybe fire codes are to blame. Taiwan is full of very nice new high-rise development that contains units with lots of bedrooms. Wandering around those developments and the new 3-story developments in California, the ones in Taiwan are much, much, much nicer, even from the outside. The NIMBYs should take note.

> Non-housing costs are quite low in Taiwan. Food and childcare, in particular, are so much cheaper than California that it’s hard to believe.

Those are downstream of housing restrictions to a large extent. From "Housing theory of everything" [0]:

Consider a cleaner living in Alabama. In 1960 they could move to NYC and earn wages 84% higher, and still end up with 70% higher income after rent. In 2010, they could move to New York City and become 28% more productive, and earn a wage 28% higher – and reduce the surplus of workers back home, letting them demand higher pay. But since housing costs are so much higher, the net earnings and living standards of someone like this would fall if they moved today, and wouldn’t be worth it. The same would be true for plumbers, receptionists and other professions that allow other people to specialise at what they’re best at and minimise the time they spend on things like DIY and answering the phone. By contrast, top lawyers get wage boosts that are still sufficiently higher to justify a move in both 1960 and 2010, even after the higher rents they’ll have to pay.

[0] https://worksinprogress.co/issue/the-housing-theory-of-every...

Anyone looking to start a new manufacturing business would be insane to consider California for any number of reasons- cost-of-living, (urban) quality of life, regulatory environment, state taxes, etc.

Right now manufacturers should be considering other states. Florida, Tennessee and Texas all are income-tax-free and have business friendly regulatory climates. Several states like Alabama and West Virginia offer extremely low cost-of-living and property costs and likely would negotiate tax abatements.

Texas actually has higher taxes than California, despite the lack of income tax. They make up for it in property tax AFAIK. California actually has low property taxes for many property owners, thanks to the controversial proposition 13.

Desirable urban areas of California are expensive because we don't have enough housing.

And you would be crazy to move your company to Florida where if you got on the wrong side of the governor, he would go out of his way to punish you.

Florida is my current home state.

You would be much better off moving to GA, TN, AL or almost any other southern state with more traditional business friendly Republicans.

And this isn’t meant to be a Republican vs Democrat thing. More so a “business friendly traditional Republican” vs “culture warrior Republicans”.

I have no opinion of how Democrats run their states. I’ve only lived in two states my entire life - GA and FL. I don’t keep up with state politics in other states.

Does anyone truly want to live in Florida, Texas, Alabama, WV? (I left Tennessee off the list because it seems a lot to people _do_ want to live in Nashville anyway).

I grew up in Texas. I've lived in 5 states and a Canadian province.

My sisters house in Fort Worth is assessed a little lower than my house in WI. But her property tax is more than my property tax plus WI state income tax so.....

>Florida, Tennessee and Texas all are income-tax-free and have business friendly regulatory climates.

Yes, and abortion is illegal in those states, the schools are terrible, and they're full of MAGAts. You're not going to attract top talent to these places, especially women. There are very good reasons that knowledge industries are mostly concentrated in blue states.

All true. The question still remains how many US folks can /want to go live in Taiwan vs How many Taiwanese can / want to live in US suburban dystopia. And I say this as immigrant to US increasingly disenchanted by suburbia.

From what I read housing price to income ratio has increased ~2.5 times from 6.5 to 15.8 in last two decades in Taiwan. And it seems to be worse in new developments in city like Taipei.

At a top echelon of Taiwan society or as a tourist it must be nice live, roam around in pleasant urban environments compare to US suburbia but I am not sure average Taiwanese are finding life great with stagnating wages and unaffordable housing.

> with stagnating wages

That's not true. The minimum wage has increased every year for the last 8 years at least for quite a decent amount. Wages have increased, maybe even more so than the US.

> And it seems to be worse in new developments in city like Taipei

If you're looking at Taipei then you have to compare it to NYC or some other expensive city and NYC isn't much better in terms of pricing.

As a non US citizen, I think there are a lot of high level cultural issues that would prevent me considering a job in the US, well before I pulled out a calculator and starting comparing salary to cost of living.

I won't enumerate them because it would be sure to offend somebody (everybody?).

That would make sense. There are really lot of reasons to not take job offer in US. And even after taking offer many may find job sucks in ways they have not initially thought of.

The only thing that's unlikely to happen is all good things one like to become available at a place one likes to live.

You yada yada'd over the best part!

While there are a number of technical issues with respect to the limited trickle of multifamily permits that are given, the fundamental dynamic is that engaged voters don't want to see significantly more people living in the region, and therefore it doesn't happen.

Yeah, it has a lot to do with selfishness. More housing means more people means you have a lower property value for you home in the area. Further, it means your vote becomes less powerful as the poors that live in the high rise have the same voting power as you do in your single family home.

I think it has a lot to do with people believing what you just said. Which is, of course, utter nonsense! If a neighborhood suddenly gets rezoned for 20-story mixed-use development, an existing house will be devalued, but an existing lot will likely gain more then enough value to compensate.

Is it selfish to have national parks when there are people that are homeless and the government could give them literally free land?

Long ago the people that lived in the area realized that they liked where they lived and how it was, and voted to put in place rules to keep it that way. It sucks now, I and all my friends the grew up there were forced to move somewhere affordable, but it's not pure selfishness. They didn't take something away from someone else, no one else ever had it. And to expand it does inherently change the nature of what 'it' is and opens a genie that can NEVER be put back.

>Rental housing with 3+ bedrooms (for families) is severely lacking in much of the US. Maybe fire codes are to blame. Taiwan is full of very nice new high-rise development that contains units with lots of bedrooms. Wandering around those developments and the new 3-story developments in California, the ones in Taiwan are much, much, much nicer, even from the outside. The NIMBYs should take note.

And it's because of zoning. Cities allow density construction but then it's almost exclusively 0 and 1 bedroom apartments because you can charge more per sq ft. Zoning laws should force apartment construction to include multiple bedroom units but that would lower the cost of 1br units. So NIMBYs don't want density construction, and the people who build density don't want big units.

So cities are unlivable if you're not young and single or happy living in relative squalor. So people either don't have children or have to move to have children and you get cities that push out a big chunk of the demographic and then force people to commute.

But isn't housing extremely unaffordable in Taipei (and presumably rest of Taiwan)? Price per m2 is comparable to San Francisco or San Jose but median earnings are several times lower.

Not just zoning. Those high rises have units with lots of bedrooms around a central elevator core, and you can’t build those in the US.

How could we get a council of a half-dozen visionaries to own a city-sized chunk of land and design a utopia, communist party-style but done right? I really think this is not possible without it being a private parcel where there aren't thousands of individual property owners in the loop for decision making.

https://en.wikipedia.org/wiki/List_of_American_utopian_commu...

People try this thing on a fairly regular basis.

You're thinking "wouldn't it be great if there was a community led by an absolute authority which agrees with me" and, uh, that kind of thing doesn't scale, last, or continue agreeing with you for a particularly long amount of time.

>I really think this is not possible without it being a private parcel where there aren't thousands of individual property owners in the loop for decision making.

This is just saying democracy is bad. Ok, but go find me an example of something else that has actually worked.

It's troubling how people think dictatorship is the solution to their problems these days. It's not even one particular viewpoint that falls into this, people of all positions are increasingly advocating for authoritarian solutions.

The first step is don't do this, central planning is a canonical bad idea. Case in point: NIMBYism works because cities are already masterplanned, "communist-party-style". American suburbia is commie blocks. So all you have to do when someone wants to change the plan is to have two or three people shout "no" at the city council and for nobody else to show up.

If you actually want higher-density, what you actually want is national or state laws that restrict what zoning can restrict. Japan is a good model for this: they have a nationalized zoning plan. Individual city councils can only pick specific zones from a list of varying densities of mixed commercial/residential zones and industrial zones.

A lot of the harms of suburban life are specific to the segregation of commercial and residential: moving people away from the places they want to go to means they need a car, and the infrastructure to use it with, which takes up space, which pushes everything else away, which creates more demand for cars and car infrastructure, and so on. Conversely, we could imagine, say, taking a few lots in an otherwise single-family development and turning them into convenience stores or something, which would be something people could just walk to.

Once you have the legal capacity to build you can then start talking about having government money go into buying and developing upzoned property. Private ownership and developers will follow. The goal is not to bring about some specific master plan but to just generally increase access to land and housing. You can run it as a co-op if you want but do not, for the love of god, micromanage people into wishing they had their $500k mortgaged single-family homes that they """owned""" back.

The billionaires are trying that in California, and us peasants are quite suspicious of the deal...

https://en.wikipedia.org/wiki/California_Forever

> How could we ... design a utopia, communist party-style but done right?

We can't. Certainly not until people stop being self-oriented, and stop being willing to sacrifice others for their own benefit. Recorded history says this is not going to happen. Even the one (as far as I understand) religion concerned with transforming human nature to love others sacrificially, Christianity, says this requires divine help. (There is even a book, "Critical Journey" that identifies the stages of spiritual life, with the life of sacrificial love as the sixth and last. Given the difficulty and slowness that even people who are committed to the journey find, getting to the life of sacrificial live probably requires multiple decades. So even within Christianity this quality is rare.)

Also, since Communism builds on Marxist ideas, which are founded on the idea of power, a Communist utopia is impossible, since the asserting of of power is the opposite of loving others sacrificially. And, indeed, 100% of the Communist states resulted in totalitarian dictatorships.

The primary problem for getting 3+ bedroom apartments built in America is school funding. School districts are mostly locally funded (sometimes with a portion funded by the state government) and almost entirely from property taxes. At a very high level, schools are funded by the acre and their expenses scale with the 2nd-5th bedrooms in their district. A 4 bedroom apartment or condo and a 4 bedroom house will usually pay very different tax rates, so local governments are highly incentivized to deny and obstruct large apartments. A 2 bedroom apartment with one child is one thing, but a 4 bedroom apartment with 3-5 children is a huge money loser.

That's also an obstacle to a lot of cities densifying and intensifying. Built out cities have a model that lets them operate, but not capital or land to build and expand in areas of high growth and demand. That's just one of many factors that are freezing our cities in amber.

> The primary problem for getting 3+ bedroom apartments built in America is school funding.

It actually is mostly at the state level, namely fire codes and condo defect laws. America has building codes designed not for safety but to make single family homes cheaper and apartments more expensive. One of the things they do is require double stairways for tall enough buildings, with the result that all apartments must be built like hotels. That plus the requirement for a window on bedrooms makes it hard to fit them in.

I don't think your analysis is valid in California. Public high schools in California receive most of their funding on a per-pupil, attendance-weighted basis from the state on a redistributive basis (all property taxes from across the state are pooled and redistributed).

Parcel Taxes allow wealthy areas like Palo Alto to have much higher qualities of education. School District quality is probably one of the number one factors for families looking for a home.

> Taiwan is full of very nice new high-rise development that contains units with lots of bedrooms

But presumably you'll never be able to buy and will have to rent forever? Real estate is significantly more expensive in Taiwan relative to income than in SF/etc.

Is a market where housing supply meets demand, housing is a depreciating asset. Why would you want to buy if renting is cheaper?

> Is a market where housing supply meets demand, housing is a depreciating asset.

How so? Supposedly house prices increased by 50% in 5 years there. So obviously it does not meet demand...

> Why would you want to buy if renting is cheaper?

Because it's usually considerably cheaper long-term? Rent prices go up all the time, so you'd lose a very significant amount of money over 10-20+ years.

Part of the equation must be the simple fact that the US is big and has the option to give many people the 0.1+ acre detached single family home with a yard and 2+ car driveway/garage lifestyle (and schools with more exclusive student populations).

In smaller places, that simply isn’t an option, so there exists greater demand for family living in high rises.

Yeah, very few people who want and can afford 3-bedroom homes want to be renting apartments. I assume that even in New York City, the number of 3-bedroom condos is pretty minimal as a percentage because most people who want that kind of space just move to West Chester or Connecticut.

This is not universally true, and it's pretty common to hear people who moved out to the suburbs hate it, but they needed the third or even second bedroom! Slightly larger condos simply didn't exist on the market, or were priced at astronomic rates (double the $/sqft compared to a 1bd unit).

Looked at a dozen midrise buildings this year across DC/Phila/NYC markets, some new/recent construction, some office conversions. Most buildings had zero 3bd units except for maybe a single penthouse, a 2bd unit every other floor, and the entire rest of the building evenly divided between studios and 1bd units in the 400-600sqft range. The competition for the 2bd units was unreal, in several cases people were offering the entire year's lease upfront, in cash, to secure an apartment.

It really is that competitive and the demand is there, the supply is not.

Part of the problem is what is available. If you're a Japanese or a Taiwanese, that detached single family home with a massive garden around it is simply not an option, so you don't feel worst off than anyone else by living in a small house or in a high rise.

Other advantage is that keeping cities very dense and preventing urban sprawl means everyone has access to nature quickly, through public transports.

Absolutely true. Also I find it strange that the companies in question could easily resolve their workforce issues by forming a fund to build better/faster public transit to link up their offices with less NIMBY-dominated cities, but choose not to do so.

Transportation rights-of-way invoke all the same NIMBY problems, only worse because an individual holdout parcel sinks the whole thing.

What they can do is run buses on existing public roads. And they do that. It's still like 1.5+ hours from the Tri-Valley to SF.

I don't think the lack of usable rights-of-way explains public transit issues in the Silicon Valley.

Tech companies had very modest participation in the Caltrain PCEP project, and still barely participate in the Dumbarton rail corridor planning, have made no direct moves to expedite or simplify the BART Silicon Valley expansion, have not attempted to improve the performance of VTA light rail, have not publicly tried to pressure the SF city government to expedite or simplify Caltrain DTC, and have made no proposals to make use of vacant or underutilized rail or ex-rail rights-of-way across the Silicon Valley where no NIMBY opposition exists. (Yes, Atherton is famous for its NIMBYs blocking the original HSR construction plan. It's not currently relevant and can be bypassed.)

> Non-housing costs are quite low in Taiwan. Food and childcare, in particular, are so much cheaper than California that it’s hard to believe.

That statement is the problem.

Nobody wants to rent. There are too many rental properties, and not enough affordable housing. The reason you need rental properties is because you're already trying to make a living from families having a home. You're not supposed to do that. That's supposed to be the prize for the family for assimilating with capitalism. By buying it and renting it back to them you're disincentivizing the working class from working.

But by all means, keep privatizing the shit out of 3 bedroom family homes and see what happens. Take every drop of value out of the housing market and bank it. That's what pitchforks are for.

The purpose of capitalism is to establish, reinforce, and perpetuate a class hierarchy where the people on the bottom must constantly pay to exist while the people on top constantly get paid to exist. This shit isn't a side effect, it's the entire point of the exercise.

Unfortunately in their rejection of capitalism, the people have mostly decided to do feudalism, i.e. legitimacy comes from land ownership and land tenure. It is even hereditary: heirs get to pay much lower property tax than transplants.

I don't think we're going to see eye to eye on capitalism, but even Marx would agree with me that it's better than feudalism.

The thing that makes America a corporate-dominated oligarchy is veto rights. The American middle class has enough political power to get issues on the table but not to overcome an anonymous rich person saying "no". NIMBYism is the same underlying power - vetocracy. So corporations would have to spend way more time fighting their own power to get things done.

This is an insightful synthesis, thank you.

> trillion-dollar industries at the forefront of the global economy constantly getting their shit rocked by a few dozen NIMBY retirees at city council meetings

A lot of Intel R&D (and all their manufacturing) is outside the Bay Area, i.e., Oregon and elsewhere, so not sure this is a factor in their case.

The federalized nature of American government means both things can be true simultaneously, even though they seem paradoxical when placed together in juxtaposition. The Feds have supremacy in certain matters, but not all.

Moreover, lobbying is more a question of connections and relationships which are lubricated with money than pure spending power, so it can be easier for a large corporation to nudge things its way at the national and state levels while still struggling to curry influence at the local level, and vice versa for small companies.

Lmao @ AMD coming out on top.

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