They're throwing money away. Actually, I would be glad if this money was entirely used for research, because Intel and other US companies badly need it. But they will waste it on plants that are already outdated in the best case scenario. The worst case scenario is Intel giving this money to investors directly or indirectly in the form of stock buy backs. And nothing of this would be necessary if Intel had invested their profits in research, instead of sending money to investors to keep the stock price high and, consequently, their executive compensation.
What do you mean by outdated? Companies are already designing chips for their 1.8nm process, in addition to Intel's mid-late 2025 chips switched back to Intel fabs, for 6 months from now. TSMC is still working on their 2nm process.
The only players in that market are Samsung, TSMC, and Intel. It'd be crazy to let one of the three global EUV lithography manufacturers disappear because their R&D costs have lowered net revenue temporarily.
People act like Intel has nothing to offer, when they're one of a low single-digits number of companies who are even capable of making modern microchips. Even China won't likely crack EUV for the next 5 years. Throwing all of the money on pure R&D would be madness. And the chips act is investing in a major R&D facility in upstate NY for next gen stuff anyway.
Scrapping their last gen process to focus on 1.8nm was a long term play, and all signs point out to it working out well.
Not to mention, it'll be nice to have at least this one US company making modern microchips, in case the many fabless US microchip companies ever need to switch to domestic production, due to economic or geopolitical reasons that are clearly on the short term horizon.
I was about to write, "yeah, but Intel has good long-term-oriented leadership now in Pat Gelsinger, so while it'll take time, it'll eventually bounce back. Because, under him, it's finally been investing in R&D instead of coasting and doing stock buybacks."
And then I Googled (to check the spelling of "Gelsinger"), and found this:
So who are David Zinsner and Michelle Johnston Holthaus? They seem to be money and product people, not foundry people or architects? I'll need to look more closely, but to my mind this doesn't bode well for the long term.
I see that the stock is up 5%, but I don't trust investors to think long-term enough. Investors are also happy when you Boeing the shit out of a company.
That news came out after I wrote my comment, but that vindicates my apprehension towards Intel's ability to execute. Only believe them after they deliver.
I can almost set my watch to comments like this. I understand the HN policy is that conversations should get more nuanced over time rather than less.
And in cases where I don't personally know, one of my heuristics for who's more likely on the right side of a question is who's contributing to my understanding, who's setting context, who's comparing alternatives, who seems to be pointing out specific details I didn't know about. Those are the positive indicators. On the not so good side are things that I would call reflexes, which is to say things that are not expressing ideas but are more like muscular reflexes that don't react to or build on the information of the more constructive comments.
While I'm not thrilled with Intel over the past few years, the context of their capabilities to manufacture chips, the specifics about next gen 1.8nm chips, and the way this is complementary to R&D which is happening simultaneously, those allow me to hold two things in my brain at the same time, namely that Intel has made poor strategic decisions lately and also that they nevertheless are stewards of profoundly important and valuable chip design and manufacturing capabilities.
yes, Intel chips aren't even that bad. Sure Intel fell back a little compared to AMD but the benchmarks are not far off at all, in fact in some Intel is ahead while consuming a bit more power. It really feels like most people make their decisions purely based off of social group consensus and not what is actually true. https://www.phoronix.com/review/apple-m4-intel-amd-linux/3
Thanks! I've found I've had to lean into it for survival in complicated workplace dynamics but haven't had an opportunity to put it forward as a primary professional skill, for whatever that's worth. You're not wrong that it's been a high priority thing for me, at least.
Intel is so fucked it’s not even slightly funny. Anyone who disagrees, do the most basic research possible by reviewing their benchmarks. It’s like going back in time.
Single-threaded benchmarks without additional information are pretty much meaningless, because the single-threaded performance is easily increased to beat any competitor just by accepting a higher power consumption.
The best Intel core for single-threaded performance, Lion Cove, has an IPC (instructions per clock cycle) about 2% higher than AMD Zen 5.
Currently both cores are made by TSMC and they reach the same clock frequencies, therefore the Intel core is negligibly better in single-thread performance.
Nevertheless, Intel Lion Cove has a much greater area than AMD Zen 5, despite being made with a superior TSMC process. Because of this, Lion Cove is inefficient for multi-threaded performance (because in the same area more smaller cores could be crammed), so Intel is forced to use it in hybrid configurations with Skymont cores, in order to achieve an acceptable multithreaded performance.
The worst is however that Intel is not able to use its up-to-date cores in server CPUs, because they are too slow at design/validation. Their new server CPUs, Sierra Forest and Granite Rapids, use obsolete CPU cores that are not competitive with AMD Zen 5, instead of using the best Intel cores.
Unlike Intel, where 1 year or more of delay between using a core in consumer CPUs and using it in server CPUs is normal, at AMD they launch the corresponding server CPUs only a few months after launching consumer CPUs.
Hey - I totally get the single-threaded CPU fixation, but it's such a narrow slice of what matters in computing today. We really need to look at the whole picture: power draw, heat output, physical space, AND speed. Cherry-picking just one metric doesn't tell you much.
The biggest compute demands right now are all about GPU power, especially with the AI boom. And Intel... well, take a look at those DirectCompute benchmarks. You'll need to scroll past 100+ other cards before you even see them listed (https://www.videocardbenchmark.net/directCompute.html).
They make great CPUs, no doubt, but they've got some serious catching up to do in the GPU space if they want to stay relevant in today's parallel processing world.
Which is not particularly important without the context of price, heat, availability, multicore perf, etc. As a whole, there appear to be better values on most fronts, though necessarily when all is combined in some opinionated way. There are certainly good values to be found in the intel world, but I can't think of a time where they have been so comprehensively challenged.
Intel had to agree not to buy back stock for 5 years when they accepted this money. They went from 50 to a low of around 20 during a huge bull run in semis too so whatever they are guilty of I don’t think they can be accused of “keeping the stock price high”. I believe they have smart people doing research but extremely poor incentives and siloing so no engineers can make any headway. I don’t think Gelsinger has gone hard enough in correcting this so maybe fresh leadership would help.
So whatever their problems are, throwing more money at R&D is unlikely to solve them.
Also, Intel has committed to not doing stock buybacks and has stopped the dividends completely. They may resume at some point, but it's unlikely to be soon.
150-200k for a mid career engineer, according to the internet, which does seem a little behind. It's a livable wage in Washington county, Oregon, so if the standard for decent salaries is "pays a livable wage", then it seems they do. But if decent implies more than just livable, then it's questionable.
$200K after taxes and insurance and 401K contributions comes out to around $10K a month. If you live in a low cost state, that's great. If you are stuck in SV, that's not as great.
Also, when I interviewed with them out of college in the late 1990s, they offered stock options and if you worked there 7 years, you get a paid 3 month sabbatical. I'm not sure if they still do that; that was in the Andy Grove days.
I wanted to learn databases and application dev. They wanted me to wear a bunny suit and support their VAX/VMS systems. No thanks.
It's really a perspective and "keeping up with the Jones's" situation.
You are a tech engineer and "live comfortably" means that you "live like a tech engineer" in the area. Which means "not making financial sacrifices to work at company X".
Live comfortably for some people means single family home with yard, 4 bedrooms, 2-3 annual vacations, eating out once a week, shopping at expensive grocery stores, etc. etc.
Now put all these $200k or dual income $400k people in the same area and it becomes a race to the bottom of "who is willing to live closest to paycheck to paycheck".
In the US, salaries are always given as gross (pre-tax). Someone earning $200k gross in California would take home around $130k/year if single and $145k/year if married.
The more money people have, the bigger they spend, the bigger their monthly payments are. Somebody making 100k and somebody making 200k both feel like they're barely getting by. Meanwhile somebody making 50k (in the same city) is also getting by, but may as well be invisible to the first two..
In this context, decent would imply sufficient to incentivize a sufficiently smart person to work at Intel, and live wherever Intel needs them to compared to other opportunities, such as living in the Bay Area and earning multiple hundreds of thousands of dollars per year and the potential for much more by starting your own company.
Microchip manufacturing is supposedly one of the most difficult things to do in the world, but why should the smartest people in the world do that if they have a maximum potential of a few hundred thousand dollars per year when writing software can get them far more?
If you want to attract smart people now, you have to compete with their pay now.
Letting your organization rot for 15 years while the owners reap the rewards is fine, just don’t be surprised when you’re irrelevant in the future. Or maybe do that because you’ll get a bailout from the US federal taxpayers.
Intel doesn't have a problem with R&D at the moment. At least in terms of direction they are doing great. ( May be not GPU but that is another story ) And as others have said they cant buy back stock with this money grant.
They need the money if they want to do foundry business competing against TSMC. And I would argue even $8B is too little. Latest Leading edge Giga Foundry in Taiwan is roughly $20B. You will probably need at least $30B in US.
Very unfortunate Intel is still hanging on to its GPU unit which is burning money. I guess part of the AI hype meant Pat Gelsinger cant let that part go.
Their consumer GPU segment def does look a bit shaky at the moment. The Arc gen 2 discrete GPUs will only compete current-gen to current-gen with mid tier Nvidia and AMD chips. However, gen 3 is on an accelerated release schedule, and will likely be arriving late next year (supposedly, with capabilities that will bring it closer to the top tier chips).
I think where Intel really shows promise for GPUs and accelerators is in the price-point area.
The Gaudi 3 accelerators that entered general availability two months ago manage to outdo Nvidia's hopper chips when comparing precision-to-precision, and retail for half as much. The overall success of that line really depends on whether work to overcome the lock in of CUDA will pan out sufficiently. Personally, I think it will, as AMD, Google, Amazon, and others are all making (and successfully rolling out) chips which depend on breaking the industry out of the walled garden of CUDA via direct integration with the most common higher level tools used by ML engineers.
Given the availability bottleneck for Blackwell, there is a growing market for alternatives.
And, again, half the price of Hopper chips, for better performance, for a product that's already on the market, is a pretty attractive proposition that will certainly see more orgs coming through the door. Might need to put one of these $14k 128GB intel hopper-peers in my workstation...
If they were in better financial circumstances, they could win on consumer product pricing, at least.
The 1st gen Intel Arc cards had a bit of a rough launch and still have issues with things like Unreal Engine games, but something like A580 for 150-175 USD and A750 or A770 for 175-250 USD, or even less, feels like good value! While Nvidia is doing whatever they want price wise, the amount of money in my bank account seems to like Intel's line of products more (currently using an A580 which I got for around 200 USD near launch to replace my old RX 580, getting a 3060 would have been and still is like 300 USD where I'm from). While XeSS is pretty good, since they don't have CUDA (it's just entrenched at this point) and framegen, they might as well compete on the price.
Which makes their launch of the Core Ultra CPUs that much more puzzling. They easily blow my current Zen 2 based Ryzen CPU out of the water... but I'll probably go for a Ryzen 7 5700X as my next CPU, because at least there the pricing makes sense. Intel's new CPUs being more or less a sidegrade/slight downgrade for gaming (even if improvement for productivity in some cases) wouldn't have been such a big deal if the pricing was actually good, instead of asking for 300 - 600 USD in addition to needing a new motherboard.
Yeah I think Intel is a dark horse here in that AMD has kind of already stated they're pulling back from the extreme end of performance. If Intel's engineering work improves (and notably their driver staff do a good job) iteratively in short order as they've spoken about, I can see them capturing a good chunk of the GPU space and become the de facto discrete option on laptops.
CUDA is definitely the biggest hurdle as you pointed out though. NVidia's bet there paid off big time.
> And as others have said they cant buy back stock with this money grant.
Money is fungible though. If I gave you $1000 and stipulated that you can only spend it on your mortgage, and you do indeed do that, you still have an extra $1000 you normally wouldn't have at the end of the month. Now let's say you decide to buy a TV with your extra $1000. Did the $1000 I give you go towards paying your mortgage or buying a TV, which is something I explicitly said you couldn't do?
Now scale that scenario up to Intel's case. Methinks they'll build a fab AND do a stock buyback. Under normal circumstances, they'd have to pick one of those things to do.
Much like with Boeing, they are out of options. the US has no other chipmaker but Intel. China has about half a dozen.
the 8bn is more of a pointy stick at this stage to try and get your 56 year old failing chipmaker to do something besides profiteering (buybacks layoffs and mergers.) Its a wasted effort. short of nationalizing Intel, the US is going to lose a crown jewel of its technological advantage solely due to mismanagement.
China does not have it because they are currently sabotaged by the US.
Had they been allowed to buy from ASML and other leading manufacturers of manufacturing equipment, they would have had better chances to compete with TSMC than Intel.
Even with the current sanctions, now when Gelsinger has been forcefully retired, which raises serious doubts about the viability of the Intel 18A CMOS process, which was the bet of Gelsinger for restoring the competitiveness of USA, this increases the chances for China to reach a point when they will have better semiconductor fabs than USA, which would not be good.
The hope that nobody will be able to make photolithography equipment competitive with ASML is likely to be an illusion identical with the belief of Intel from 10 years ago that nobody can make CPUs competitive with theirs.
While people believe this, SMIC is producing AI chips that are already competitive with NVDA. Considering that China is the top market for AI technology, the idea that SMIC is not competitive with other chip manufacturers will invalidate itself rather quickly.
ASML* is the only company in the world who makes these machines. TSMC buys them from ASML and i still wonder why intel can't manage the same node, it's a thing i never understood.
Anyway, no one is even close to doing what ASML is doing.
Edit:
From a rapid Google search seems line under 90nm there is only ASML. Canon and Nikon compete on older nodes.
The problem is that if what they say were true it would be hard to believe that Gelsinger, the main supporter of 18A as the savior of the company, would have accepted to be retired before enjoying the success of his efforts.
The forced retirement can be explained only in two ways, either the 18A is projected to be a failure and USA has lost any chances to become competitive with TSMC, or the retirement has been imposed by political forces that are completely incompetent and which do not understand anything about the semiconductor industry, and also in this case it seems likely that USA will fail to become great again in semiconductor IC manufacturing.
That's actually pretty cool. Chip companies can't complain that Chinese companies are ramping up faster just because of their subsidies anymore. This should level the playing field, hopefully?
>And will likely disappear on January because anything one party does must be undone.
I completely understand the sentiment and I believe your read of the ideological landscape is probably spot on. But in practical terms, how likely is it that such a thing could actually happen? Once the grants are locked in I think it might be really difficult to attempt to claw back money that's been allocated. The same things going on with the infrastructure bill and the inflation reduction act, namely that I think there's a race against time to try to get these funds out the door before the next Congress could take them away.
So, despite the best efforts of the next congress, we might nevertheless stay at the frontier of things like chip manufacturing and next gen infrastructure in it's various forms.
I'd think any such flip-flopping would have to be limited to whether to issue additional grants, rather than trying to cancel ones that were already issued?
> And will likely disappear on January because anything one party does must be undone
Trade policy, especially towards China, has been quite bipartisan the past two Administrations so your pessimism isn’t entirely warranted. Trump doesn’t like the CHIPS Act but it’s unclear how serious any opposition will be once they get in and how much discretion they even have given the circumstances.
But he thinks the way to spur domestic manufacturing is via tariffs of overseas chip makers, not via government investment. He talked about this when he was interviewed by Joe Rogan before the election (I read a writeup, did not listen to it)
> FWIW, though, he manufacturers his merch overseas doesn't he? Seems like if he supported domestic manufacturing, he'd... use it?
"Official Trump campaign merchandise is made in the United States, which the website explicitly states. However, there is a market of unofficial Trump merchandise that is made in other countries and sold online and at rallies."
Not his campaign merch, though that's good to see I guess. He's got business lines in everything from food, to home furnishings, to apparel. Is that all manufactured in America?
He said, on multiple occasions he was opposed to cutting Medicaid, but he did so. He signed a later saying climate change was one of the most extant problems the world faces then later called it a hoax. He said one of the most pressing concerns facing America was ensuring everyone had access tell clean water but repealed the clean water act. He was for universal healthcare, he was for lgbtq people, etc etc.
The x86 companies (and/intel) do better with competition.
I’ve had my last laptops (work/home) with amd and it’s much better battery life and performance then my (9th? Gen) intel notebook with nvidia (the battery life was Terrible but it could game). I think Apple puts a lot of pressure on too, which helps.
I guess intels “ultra” notebook parts are better.
There is some x86 advisory group now to keep the instruction set in sync between the 2 companies. Linux is involved and is Linus so it should be at least a little fun.
I ended up with a 3090FE card, decided to build the first tower I’ve built in years. Opted for and 7800x3d, didn’t realize what a dope chip it was. It was just a better price point than intel - I think 2022 or 2023
When the company is the only company that's building a product that's needed domestically and internationally and is essential in the modern age and their biggest competitor is in a country that you need to protect from another world superpower I'd say exceptions are in order
Or you force them to license their patents and I.P. to alternative suppliers on reasonable terms, invest money in all of the players in that market, and the best players grab more market. If building a fab, it should probably not be managed by Intel but could pay them for their tech. Intel should get much less of the money since their management is the problem.
I’ll note that the only reason there even is a good market for x86 is that Intel was forced to license patents to AMD. Centaur and Transmeta had their innovations, too. More competition, esp building on proven fabs and I.P., would be the best route for the x86 ecosystem.
Likewise, IBM has competing suppliers in POWER markets. Apple bought the power-efficient one. ARM’s model is pro-competition with the huge number of good products showing what my Intel proposal might accomplish.
>is predicated on a very low risk scenario where Taiwan is invaded?
Low risk scenario? Chad is insisting that it's inevitable, constantly escalating their military exercises, and it's seeming like they're increasingly on a near-term timeline, and it seems like military interaction with the United States is almost guaranteed, it seems like that is an extremely provocative danger.
I might go so far as to say that it's among the top five greatest risks facing the world over the next 10 years. It's about as risky as it gets.
What is likelier is China actually succeeding in matching TSMC's capabilities and duplicate the entire west tech ecosystem completely. Anyone who still looks at China as a producer of cheap crap is a decade behind. Their STEM workforce dwarfs the west, they have the means, the ability and will to utilize every trick in the book (like spying). Taiwan and China are not like South and North Korea. They can lure engineers from Taiwan to work for them.
China is aggressively modernizing their chip manufacturing capabilities, it's nevertheless extremely hard, and their ambitions to absorb Taiwan and TSMC's capabilities into their economic industrial and military ambitions would serve to compliment their efforts
Because they can't and I wasn't suggesting they could. It could simultaneously be the case that they can make some degree of forward progress that falls well short of replicating the capabilities of TSMC.
that very low risk is predicated on the US sticking its neck out for Taiwan. Also considering what's happening in the world at large I wouldn't be so sure there's that low of a risk after all
> that very low risk is predicated on the US sticking its neck out for Taiwan.
Half of the US military is obsessively focused on this scenario. The Ukraine war showed what an invasion of a neighboring country gains you and that one didn't involve US airforce, navy, and marines directly intervening.
The odds the Chinese will suddenly be happy being poor and isolated from the west like Russians in exchange for Taiwan is extremely unlikely.
> Half of the US military is obsessively focused on this scenario. The Ukraine war showed what an invasion of a neighboring country gains you and that one didn't involve US airforce, navy, and marines directly intervening.
Taiwan is a little island right next to its adversary, and far away from its major allies. It's not Ukraine, you can't drive a truck from NATO to it.
Also the western cupboard is looking pretty bare, after so much equipment and ammunition has been burned up in Ukraine. Western production capacity can't keep up.
IIRC, and the US blue team has lost every war game it's conducted on that scenario. Like it or not, China is modernizing its military quickly, so the US can no longer depend on having a huge technological advantage to compensate for its weaknesses in this scenario.
> The odds the Chinese will suddenly be happy being poor and isolated from the west like Russians in exchange for Taiwan is extremely unlikely.
It doesn't matter if the Chinese (people) are happy or not, they don't really have a say.
Americans, on the other hand, will feel just as poor if they become isolated from China (just think of all the Made in China products that won't be restocked), and they do have a say.
In WWII, the Allies won in large part because America was the workshop of the world. Decades ago it ceded that title to China, because muh profits free trade. That doesn't augur too well for the outcome of a future conflict.
Go ahead and play the war games, but stories I've heard indicate that the Chinese military is at least as corrupt as Russia's.
Ukraine invasion was a flat land invasion. Invasion of Taiwan involves crossing a body of water and then an invading a mountain fortress Isle.
Ukraine just grew wheat for the third world.
Taiwan produces the world's most advanced semiconductors and many of America's most profitable businesses are dependent upon it.
The Chinese do not have a deep water Navy. We can blockade their oil supply with a couple destroyers in the Malacca strait. No oil, no food. China starves in six months.
Consider this strategy. If China tries to invade Taiwan, The best strategy may be overwhelming conventional defeat of the Chinese forces so they get back in the global trade game rather than extended blockade and disruption of the geopolitically extended supply lines.
In the meantime, any US company depend upon Chinese production really should start partying with them to move production or at least distribute production to Mexico as well as China.
US businesses should be encouraging Chinese companies there depending upon to open satellite manufacturing branches in Mexico or South America. A lot of Chinese industrialists are concerned with the increasing authoritarianism in China and are probably desperate to diversify internationally.
> Go ahead and play the war games, but stories I've heard indicate that the Chinese military is at least as corrupt as Russia's.
Maybe so, but Russia is still winning in Ukraine.
> Taiwan produces the world's most advanced semiconductors and many of America's most profitable businesses are dependent upon it.
> The Chinese do not have a deep water Navy. We can blockade their oil supply with a couple destroyers in the Malacca strait. No oil, no food. China starves in six months.
China is building ships far faster than the US is, and they don't have to operate halfway around the world in this conflict scenario. Also, they're working on building a blue-water navy right now.
> Consider this strategy. If China tries to invade Taiwan, The best strategy may be overwhelming conventional defeat of the Chinese forces so they get back in the global trade game rather than extended blockade and disruption of the geopolitically extended supply lines.
The US/NATO has avoided a direct conflict with Russia for a very important reason everyone understood during the Cold War, and that reason also applies to China. I think the US is more likely to lean on Intel and let Taiwan go than engage in a full-on direct conflict with China (which the US would also likely lose).
Also, China's not stupid. They have high-priority projects, to reduce the vulnerabilities you cite, which they are making progress on, e.g.:
When the US tries stuff like that, business interests undermine it, then it gets flogged as a boondoggle and never repeated. China just does it. If it doesn't work the first time, they try again.
> US businesses should be encouraging Chinese companies there depending upon to open satellite manufacturing branches in Mexico or South America. A lot of Chinese industrialists are concerned with the increasing authoritarianism in China and are probably desperate to diversify internationally.
US business interests have the US government by the balls, so they were allowed to sell out the US industrial base and have been able to freely throw wrenches into attempts to address that problem. Chinese business interests don't have that kind of pull, and I don't think the Chinese government will allow them to pull the same kind of shit. I wouldn't be surprised if those industrialists would get thrown in prison if their business actions threatened Chinese state interests, and they most likely know it.
> It's pushing toward a stalement, far short of its initial invasion goals and at vastly heavier cost than intended.
The momentum is in Russia's direction, and it feels like Ukraine is teetering in the brink due to manpower and resource issues, and that's even without Trump.
If Russia pays the price, it won. Winning is winning, even if it's Pyrrhic.
Which is why Russia's economy is collapsing with devalued rubles, high inflation, high interest rates, closed banks, they are calling up NK soldiers, lost territory in Russia, are losing 1500-2000 soldiers a day?
They are losing like 100,000 soldier per 10 miles of ground they gain. Talk about unsustainable.
And now Russian staging, logistics, weapons depots, artillery, airfields can be targeted with ATACMS.
Absolutely nobody has any momentum in this. If anything, Russian meat wave tactics lend themselves to spectacular collapse if morale and logistics break. So they grind soldiers for months to gain 30 kilometers, and suddenly get overrun by a swift counterattack if the line falters.
It's hard to get info on the actual kill ratios, but I would guess meat wave tactics are resulting in 5:1 kill ratios by Ukraine, if not better. We'll see what winter does to Russian troops, they aren't typically well supported or supplied even in summer.
Afaik Russia isn't losing its own army, all those soldiers lost are foreign mercenaries which only costs them money. Kill ratios might be because they're sending in untrained Indians and not professional soldiers. As I understand it Putin is doing this to not turn his own country against him
"Teetering [on] the brink" is overdrawn. I'm not aware of any analysis that suggests that the Ukrainian side is on the verge of collapse.
My own sense is tha the conflict is long past the point where it can be meaningfully won by either side. The best either can hope for is an outcome that can be presented internally as "not losing". Any attempt to portray the outcome as substantially stronger than that will be a matter of spin and rhetoric.
> Except it doesn't, as we have seen with another nuclear power in the course of its psychotic attempt to invade Ukraine.
Because the West has been very careful not to push too hard, and has afforded Russia a grinding and expensive advancement on its goals. If NATO forces joined directly, or Ukraine was marching to Moscow with Western aid, I think you'd have a different story (e.g. at least the use of tactical nuclear weapons, which I think would quickly spiral out of control).
Honestly, I think this could be fixed in probably a year, if the US made a rule that 10% of anything sold, whether it be the assembled or parts, has to be manufactured in US, Canada or Mexico.
I got to be happy with South America or Africa or obviously Europe
The biggest difference from 2023 Q3 is a massive loss in "Cash flows provided by (used for) operating activities". Too many pizza parties I guess. This feels more like creative accounting to justify the layoffs and other cut backs.
Taxpayer money can’t be spent on profitable companies, and can’t be spent on unprofitable companies. Would you rather taxpayer money be spent on inefficient government agencies instead of a free market solution?
People are comparing intel vs AMD here, but in this context -- AMD doesn't actually make the chips do they? They've designed the chips and other companies such as TSMC make the chips.
A chip plant / "fab" is the thing that makes the chips, and the point of the chips act is to bring some of that manufacturing back to north america in case we end up in or watching a big fat war in asia that may impact TSMC or samsung's capacity to make chips.
Efficient is a synonym of "brittle" and some important things are better if they're inefficient and robust.
I’m a fairly traditional libertarian but I’ve softened a bit on my definition of “essential industries”. If other countries make essential goods we need, and they become hostile to us or get conquered politically by those hostile to us, in a war we would be in a lot of trouble. We saw a bit of this during COVID when we couldn’t even make basic products.
No matter the subsidies they will still lose if their products suck. But we need some minimum ability to build things here if it all goes to hell.
Yes, it's something that all governments should be thinking about. Globalisation is amazing for delivering the greatest production efficiencies, but it can easily break down in times of pandemic or war.
Not sure how the top-hat tropes apply here. US workers are highly competitive in terms of productivity/compensation.
>The Cost of Federal Regulation Aug 4, 1999 2 min read
>The Office of Management and Budget (OMB), the White House's own budgetary agency, puts the price of existing regulations at approximately $300 billion annually. Others, such as Professor Thomas Hopkins of the Rochester Institute of Technology, say it's closer to $700 billion. This means regulations cost somewhere between $3,000 and $7,000 per household every year.
>$3.079 trillion
Cost of federal regulations to the U.S. economy,
$465 billion
Increase in aggregate regulatory compliance costs since 2012,
$277k
Avg. annual compliance costs for a U.S. firm,
$29,100
Avg. per employee cost of regulations for manufacturers,
$50,100
Avg. per employee cost of regulations for small manufacturers (<50 employees)
Wonder what the economic benefit of giving away 20K median priced homes would be for the economy versus giving Intel's stockholders an incentive to build the bare minimum in the US.
Probably goes in the same category as other defense spending. Short term plan is to defend Taiwan and hope nothing goes down. Long term is to ensure that we won’t have to in the future.
While a nice story, people maybe forget just how bad AMD was doing then. Intel, even in its currently weakened state, earns >10x as much revenue as AMD did in 2015.
As a former employee, I can say it isn't. It's worse. A lot more of the great people Intel used to have left because Intel tanked and went nowhere while they watched AMD, Nvidia, Broadcom, and a whole bunch of other hardware companies go through the roof. It's basic economics for these people who have the ability to leave. Put yourself in their position.
X86 throws away half its computing power on antivirus bloatware. And what other performance is left is hidden behind opaque instruction caching and look ahead. If they had actually given the end user access to speed, they might have chased speed themselves. As it was, the end user gave up on getting performance out of x86.
I'm just happy as part of this deal they must keep their fab. I believe Intel will be in a good position in the future, we will have a need for a domestic fab! And they are perhaps now going to rock the graphics card scene with their launch of Battlemage gpus!
Sometimes I think they should have just offered this money as startup capital to new ventures. What's the advantage of Intel here versus just going with Intel engineers?
You need to look at how this market really operates. You have massive massive up front capital investment, you spent tens of billions of dollars designing a chip plant, and then billions more actually building one, and at the end of that 10 year long multi-billion dollar process you get 1 chip out of it. If that chip is better than your competitors the entire fabless semi-conductor industry is going to trip over itself bidding up your capacity and turning your investment massively profitable. If your chip is worse than your competitors you have to sell capacity at practically any price to recoup any possible return. And whoever did a good job? Well they've got billions to plough into the next process node. The company that did a bad job? Well now they need to go out into the market and try and get funding to make that entire bet again - but this time with a track record of failure. What's the likelihood a company coming from 0 can make all that work, with no existing assets to secure debt financing for the investment?
It's also important to understand what the US is paying for here. They're not paying Intel to make chips, they're paying Intel to make chips in the US as a geopolitical strategy. Intel will make these chips either way, but this action from the US means that Intel is continuing with their US fab plans whilst for example, dumping their EU plans.
Very likely more if applying Gall's law, no startup would be able to create a complex system like a 2nm fab from the ground-up, it'd need many intermediate simpler systems (aka other fabs) to research, and learn how to apply those processes to scale up into a complex system like that.
Yes, they're complaining about the obvious result of a monopolized market. If these companies were around, we would certainly have options and Intel could die quickly and without problem. Now we need to throw new money at a bad investment (Intel will continue to be a bad company unless they replace the whole management and change their culture).
My belief on this is that if a business received grants before the Government itself should take acquisition of the company almost like PBS thing and get it back to a functional state. The Government can later sell it off. I think grants don't solve problems they enable them unless threatened with a Government take over.
Yep and most of these large industry leaders are dying not because of the engineers but the quality of the management orchestrating the success and failures of the engineers rather than letting them work their magic.
But really most CPUs are risc cores with a hardware instruction set decoder. Considering how fast Apple and others designed arm chips for the mobile market, and there isn't that much difference between a mall mobile CPU for a smartphone and a full scale desktop CPU, I would think the barrier entry to x86 isn't that high if the US swept away any patent lawsuits.
But maybe we should just push the transition to arm now from x86. We are remarkably close to this already between AWS arm instances, mobiles, and Apple laptops.
With the embarrassment of riches and silicon, It wouldn't shock me if mixed arm and x86 execution cores we're packaged together.
In terms of efficiency having mixed cores would be excellent. You can rely on ARM for lightweight system operations and where advanced instructions come to play like AVX-512 use x86-64. The problem as it was told to me was that you run into the different relationships they have with memory and hardware. I would love the boundary to be torn away. To idle at 5 watts while streaming and use 20watts while gaming ( a serious non-mobile game ).
True, but if they matured this wouldn't be an issue. I think Intel should be acquired by the government fixed up and remanaged. Then sold off again or given the opportunity to buy itself back. If a government gives out money year after year for grants and fails to meet the mark or even go bankrupt it needs to become federally managed like a bank. Especially in this sector.
I’m not convinced either of them would even want to.
AMD used to have fabs - they spun them off a long time ago as GlobalFoundries. They’re no longer competitive with TSMC, Samsung, or even Intel for modern nodes.
Intel is the only hope for relatively short-term microprocessor fabrication on the continent.
TSMC is trying to do fabs here but that's going to take ages to scale.
The real question is, how do you subsidize this sort of development from scratch while not hamstringing or ignoring already developed abilities. For promoting advanced chip fab inside of the US, intel is america's best bet.
The only other option would have been AMD, but they closed their on-shore fabs like two decades ago afaicr.
For strategic reasons, TSMC is also not doing their latest and greatest technology nodes in the US. They don't want the US marching into the fab and handing the secrets to Intel in case of a "national security emergency."
The AMD option is already called "global foundries" for good reason. IBM is also out of the chip fabrication business, having sold their assets to GloFo.
They didn't, they simply sold off their fabs to a bunch of hedge funds and it became GlobalFoundries. It's still around, produces chips in the US, and was given a big defense contract just last year: https://gf.com/gf-press-release/u-s-government-awards-global...
Nationalize the company and return all profits to the taxpayers. For national security. But that would be crazy! Too socialist. We can’t have that kind of authoritarianism. Only the kind that subsidizes shareholders and CEOs.
Right, only for the most recent year. They've had declining profits for the last few years.
The CHIPS act gives handouts to companies like Intel ostensibly to contribute to national defense by creating domestic production of chips used in military equipment. However this will also aid Intel in its commercial enterprises not just contracts with the military. And to the extent it does, those profits won't be realized by the taxpayers that funded them.
Taxpayers should receive equity for funding privately held companies. Alternatively, if we don't want to encroach on the sacred profits of our dear corporations, the government could require that chip manufacturing has to occur in the US without capitalizing them. That way chip manufacturing remains in the US and the market can bear the risk and reward of chip ventures.
> As of Sep 28th, 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.
No, it's really not a reward. The government is doing this because they believe it's in the best interests of the country. It's not because of any opinion they have about whether Intel is a good or bad company.
The goal here isn't to make companies more virtuous. It is to change the landscape of an industry in a way that will protect the United States.
Why would this random deal of all things tip any scale for Trump? He's not some unknown quantity that's opposed to this kind of thing, he had tons of similar efforts, many of which crashed and burned.. https://www.nbcnews.com/business/business-news/foxconn-plant...
Yeah, lack of money is rarely the problem for these behemoths, it’s lack of will or motivation.
To that end, I wish the government just said, we’ve deemed you a provider of essential goods, find a way to get your company to invest onshore, or we will find a way to get your company to invest onshore, your choice.
I know, I know, slippery slope, but it’d be great if we could do this instead of giving them taxpayer money in this way - in the long, long term it’s good for the country, but in the short term it’s good for their stock.
> To that end, I wish the government just said, we’ve deemed you a provider of essential goods, find a way to get your company to invest onshore, or we will find a way to get your company to invest onshore, your choice.
Because some things are just too important to pay for honestly?
What domestic jobs? These boondoggles never generate the jobs promised, and even if they did, the per-head cost of the handout is usually enormous compared to the per-head salary.
Second: you don't enhance national security giving a near-monopoly company a giant pile of cash, further solidifying their monopoly, especially when they have a reputation for slacking off the second the teacher turns their back. The only reason Intel has innovated at all is that AMD has been forcing them to.
You realize why Apple switched to Apple Silicon for their laptops and desktops, right? Apple was sick and tired of Intel's incompetence.
They're getting $8BN in taxpayer money damn near immediately after putting out not one but TWO generations of processors that self-destruct.
Why do they self-destruct? Greed and sloth. Intel has been skimping on R&D to goose the numbers for investors, so they've had to keep pumping up clock speeds and voltages to stay relevant against AMD's actual innovation (ex: 3D cache.) Just look at the TDPs for the top chips from Intel and AMD; intel's power consumption is insane, which is hilarious given it used to be the other way around - AMD's athlon chips being huge power hogs. They boosted voltages so high the chips burn themselves out.
On top of this, their GPU lineup isn't remotely competitive, showing they can't innovate to save their lives. The initial drivers for their GPUs were just...hilariously bad given they've been putting out GPU drivers for two decades or so...and the hardware is grossly underwhelming.
Intel is a near-monopoly? That's news to everyone who's been following chip fabs for the last decade.
TSMC is a near-monopoly, and that's what the parent comment was referencing when they mentioned national security (since China is constantly threatening to invade Taiwan).
>> Except for reasons like national security and domestic jobs rather than skin color or sexual preference
> What domestic jobs? These boondoggles never generate the jobs promised, and even if they did, the per-head cost of the handout is usually enormous compared to the per-head salary.
You forgot to address the national security aspect in your rant.
> You realize why Apple switched to Apple Silicon for their laptops and desktops, right? Apple was sick and tired of Intel's incompetence.
the US wants to stratigically diversify away from TSMC, in case a war does start.
Not to mention that having more competition in the fabrication industry can't hurt.
The only question is whether taxpayers will get the value and benefit from this investment. I would hope so, but i can't tell from the past whether such an investment have netted benefit overall.
decisions dont stand alone - opportunity costs have to be taken into account.
What else could you have spent the money instead of on fire extinguishers, and would that have been more benefitial? Resources are always limited, and so not choosing the optimal spending would be considered a loss.
A worse case of meddling is the oil industry. They have been considered strategically important and gotten mind-blowingly expensive special treatment for a long time. That's one example among many.
No, this is being done for political reasons, to hedge against China capturing Taiwan.
> It reinforces the adge that capitalism is about private profits and socialised losses.
This isn't a good adage, although I agree the people saying it have a very low bar for reinforcing it. Profits are the things that are taxed, and thus socialised. Losses are absorbed by a business' owners.
This is why Trump wants to repeal the chip act. A company like Intel should not survive in the free market, and now will be propped up by the government while remaining inefficient.
This has nothing to do with bailing a company out. Intel, along with every other chip company, do not want to build any chip plants in the US. It makes no business sense for them. But this is bad for the US given that chip making is a critical defense industry. That's why the CHIPS Act exists, to onshore a critical defense industry so that if war breaks out, at least it's secure.
>Go fight a war with 1960s technology against a modern adversary and find out.
Not a great argument considering Afghanistan, Iraq, and Yemen (read: Houthis), and further back Vietnam and North Korea all wrecked the US military one way or nine anothers.
The US military has historically fucking sucked at fighting underteched enemies.
If we are concerned about national security, I would look into why we can't win wars against bass ackwards goat herders and jungle men instead of silicon that won't even see military applications for at least a few more decades.
> Not a great argument considering Afghanistan, Iraq, and Yemen (read: Houthis)
So how long did the Afghani and Iraqi governments stand up to the US military? Weeks? Maybe a month? They got steamrolled by modern military technology.
> and further back Vietnam and North Korea all wrecked the US military one way or nine anothers.
Those countries had access to then state-of-the-art military technology. A 1960s tech vs 1960s tech war is not a good stand to reason about a 1960s tech vs 2020s tech war.
> If we are concerned about national security, I would look into why we can't win wars against bass ackwards goat herders and jungle men...
The US has qualms about many tactics that could defeat an insurgency (e.g. massacres, attacking hostile civilian organizations), your hypothetical advanced US adversary may not have those qualms, so I wouldn't rely on them. Also its political system doesn't have the attention span to really stay long enough to subdue a population through other means.
> ...instead of silicon that won't even see military applications for at least a few more decades.
The best time to plant a tree is 20 years ago, the second best time to plant a tree is today.
Look: If the American casualty count is bigger than zero then we fucking failed, let alone if we outright lose the war too. Why? Because we are supposedly so fucking advanced that we are worried about silicon toys that we don't even use to kill people with.
In case you missed the memo: The US Navy admits the Houthis are giving them the hardest time since World War II and they don't even fucking have warships. We spent over two decades in Afghanistan and Iraq to end up losing them. China only has to send weather balloons to draw F-22s out. The pullout from Vietnam is still one of the biggest embarrassments in American history.
The moral of picking a fight using 1960s technology is: You will win. End of. Turns out the best way to kill someone is to just fire shit their way and kill them, who knew.
So you think the way the US would win those wars is by suffering more casualties? No, in all cases, it was the lack of political will to continue not an inability to defeat enemies tactically.
I think the way the US would win wars is by figuring out how to win wars (and ideally not start/join so many fucking wars in the first place) instead of manufacturing national crises out of nothingburgers that nonetheless catch the attention of dinner tables across the country.
Putting it another way: We're losing wars whether we make our silicon toys here or in Taiwan or if Taiwan gets China'd. I want my tax dollars put to better use than Intel.
> Putting it another way: We're losing wars whether we make our silicon toys here or in Taiwan or if Taiwan gets China'd. I want my tax dollars put to better use than Intel.
I think you should move to China, instead of moving all of us there. If you hand China all the technological cards, because muh tax dollars, that's just what you'll do. The international order will reconfigure around China and its desires, and the US will become increasingly irrelevant as it looses capability and walks down the value chain towards a resource extraction and agriculture economy.
And don't think the market will create a new domestic entry into one of these capital-heavy industries, once the domestic competitor is gone: it'll always be cheaper to buy from China, so the market will buy from China. It'll take a lot more taxpayer money to build a new Intel foundry business than to save the existing one.
They already have all the cards, thinking that we still hold the cards is delusional. The changeover of eras hasn't caught up yet, but it's only a matter of time.
No, rather than mulling over spilt milk that has dried out and stank like death, I would rather we put our tax dollars towards the milk that's still in the glass. Reform our military and politics so we can fucking win wars again if we must wage them at all. Rebuild our fucking crumbling infrastructure. Divest ourselves of all the fucking lard that has accumulated during Pax Americana.
If we can't find a practical reason to have domestic silicon factories then so be fucking it, that's reality. I want to see my tax dollars spent towards something other than against an immovable object.
I have no idea but look at it from the perspective of the US Department of Defense. Also, companies like Google make ~$8B in profit every three months for selling ads. Is it really that crazy they awarded this amount of money to try and have US-made chips?
I'm not advocating for war, weapons, defense budgets, etc., but this doesn't seem like a bad thing if it's providing jobs and chip alternatives for the US and the world. It seems like Taiwan is going to cease being independent at some point.
I don’t think the fault line is forming on free vs non-free market. Tariffs aren’t free market either. Both parties have shown some openness to putting their finger on the scale. JD Vance even likes Lena Khan. It’s hard to understand tbh.
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