A microchip the size of a human fingernail contains billions of transistors, and the properties of the chip are measured in nanometers (billionths of a meter; hence the name nanotechnology).

While the average diameter of a human red blood cell is 7,000 nanometers and the average diameter of viruses is 14 nanometers, the latest microchip technologies have placed 10-nanometre-diameter add-ons on the chip.

The smaller the size of the additives, the greater their number on one chip, the greater the performance of the chip and the greater its functionality.

Chips are divided into two general categories: “logical” chips, which are like the brain in electronic devices as they process information to achieve a task, and include central processing units (CPUs) in computers.

Graphics processing units (GPUs) for visual tasks, and neural processing units (NPUs) dedicated to machine learning, and the second “Memory”, which stores information, is of two types, one of which is “Dynamic Random Access Memory”, or DRAM, which saves information as long as the device is running, and the second is “NAND Flash”, or NAND Flash, which does the same thing even if the device is turned off.

Chip economics

The American company Intel is the most prominent developer of microchips, especially for the personal computer and corporate server sectors, and its services in the first sector accounted for 51 percent of its revenues in 2021.

While what it provided to the second sector pumped 33 percent of these revenues. During the same period. The remaining revenues came from solutions for the Internet of Things, retail, industrial, healthcare, memory and storage products, autonomous driving technology, and programmable chips.

Taiwan Semiconductor Manufacturing Company Limited

As for the Taiwan Semiconductor Manufacturing Company Limited (TSMC), it is the largest manufacturer of microchips in the world, and it produces these chips according to requests from client companies.

In fact, many chip manufacturing companies around the world are charged with producing the necessary products instead of making them themselves.

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Qualcomm

The list of companies active in the microchip sector includes the American “Qualcomm”, which designs these products and markets them in the wireless communications sector and its services. Its chipset, called Snapdragon, is present in many mobile communications devices.

By country, China makes 25 percent of the world’s microchips, followed by Taiwan at 21 percent, and South Korea at 19 percent. 

As for the United States, the cradle of innovation, the share collapsed from 37 percent in 1990 to 12 percent today, but after the disruption of almost all supply chains for goods and merchandise, especially in the field of microchips, due to the restrictions and closures imposed in light of the Covid-19 pandemic.

Continuing since the fall of 2019, and due to the economic repercussions in general and the commercial repercussions in particular of the Russian invasion of Ukraine, which has been ongoing since February 2022, Washington has issued many laws, of which we are concerned here with the American Chip and Science Act, which allocated $280 billion to many projects and priorities, including $52 billion for the production of chips locally.

The legislation aims to “seize the future in the coming decades,” according to President Joe Biden, and “move the chip supply chain from China to Michigan,” according to the aforementioned state’s governor, Gretchen Whitmer.

 

 

US federal government

The US federal government has not increased its investments in research and development as a percentage of GDP for years, unlike many governments that want their countries to assume broader roles in the global economy.

Since the dawn of globalization following the fall of the Berlin Wall in 1989 and the subsequent disintegration of the socialist bloc, American companies have tended to limit themselves to designing chips and assigning them to companies outside their country to manufacture them in order to save money.

Globalization

With globalization reeling under the blows of terrorism, repressive regimes, the pandemic, and destabilizing developments in the world order, the invasion of Ukraine may not be the last of them, the American law falls within the framework of attempts by governments, especially in rich countries, to restore supply chains to the homeland.

But what is noteworthy is that the Taiwan Semiconductor Manufacturing Company Limited, operating in a country threatened by a Chinese invasion, invests tens of billions of dollars annually in its projects (it has invested 44 billion since the beginning of 2022), which makes the American 52 billion an amount that does not hold great promise.

Geopolitical aspects

The United States and China share half of the microchip consumer market (25 and 24 percent, respectively), followed by the European Union (20 percent) and Japan (six percent). Asian superiority over the United States is not limited to chip manufacturing, but also includes product diversification.

South Korean companies

The South Korean companies “Samsung” and “SK Hynix” excel in manufacturing memory chips, despite the American “Micron” coming third in this field, while the Japanese “Kioxia” excels in the production of flash memory chips. The Taiwan Semiconductor Manufacturing Co., Ltd. is a world leader in making logic chips.

China is strengthening its presence in the market for logical chips and memory chips, while the role played by Singapore and Japan in producing the materials used in making chips cannot be neglected. As for the United States, whose production role has declined, it is still the undisputed leader in chip design.

There is the “packaging” element, that is, collecting the elements of microchips using microscopes, a process that half a century ago was done manually, which prompted most chip companies in the West to shift it to China itself and Southeast Asia in order to save labor costs.

Manual labor IS shrinking

With manual labor shrinking, without completely disappearing, it may be difficult for the United States to bring this work back home, especially since the American Science and Chips Act does not allocate more than $2.5 billion to this aspect of production.

Therefore, the law is likely to strengthen American leadership in design, primarily as it aims primarily to increase spending on research and development.

Delays in production

In response to the closures and delays in production caused by the pandemic, the demand for microchips intended for smaller laptop computers, in addition to many electrical household appliances, has increased in light of the boom in the shift to working from home due to the controls and restrictions imposed by the authorities to combat the pandemic.

Chip producing companies faced difficulties in switching to producing the required chips. As the pandemic recedes and work from the office gradually returns, the demand for these “home” chips may fall, and the companies that were able to switch to producing them will suffer from surpluses that are difficult to dispose of.

Here lies the dilemma for companies operating in developed countries, especially the United States: Will they, due to surpluses, abandon repatriation of production? Tomorrow is near. Microchips on the map of geopolitical conflict

National Security: Microchips on the map of geopolitical conflict

It is, therefore, a technological arms race between the United States and China. China threatens to invade Taiwan, not to mention North Korea’s threat to invade South Korea, and these threats were encouraged by Russia’s invasion of Ukraine.

This arms race addresses many things ranging from smartphones, cellular communications infrastructure, social media, and artificial intelligence, and now the race has reached the core component of it all – the microchip, and the American technology giants – Apple, Google and Microsoft – are relying on.

It has a strong influence on China in manufacturing its devices and the components of these devices.

American officials, such as Treasury Secretary Janet Yellen, are urging the transfer of obligations to American companies, in various fields, from China to friendly countries, such as South Korea and Japan.

European Union

The Europeans are not absent from the challenge. Last year, the European Union issued a law similar to the American law, allocating 43 billion euros to double the Union’s share of global chip production from 10 to 20 percent by 2030. China is strengthening its sector with a five-year plan it announced last year, costing 155 billion. dollar.

Technological arms race

A technological arms race will determine who will dominate the global economy in the near future. At its heart lies the island of Taiwan.

When US House of Representatives Speaker Nancy Pelosi visited the island last year with a political delegation from her country, Beijing renewed its threat to invade Taiwan, which it says is part of China but governs itself according to a democratic system that enrages one-party rule on the Chinese mainland, the Communist Party that has embraced capitalism since 1978.

Mark Liu, Chairman of the Board of Directors of the Taiwan Semiconductor Manufacturing Company Limited, responded by saying: “In the event of the use of military force or an invasion, the company’s factories will become inoperable, as they are complex manufacturing facilities that depend on real-time communication with the outside world.” – With Europe, Japan and the United States.”

Globalization is in crisis,

There is no doubt that globalization is in crisis, and the saying of the American thinker Francis Fukuyama at the end of history when the Berlin Wall fell was not true.

Perhaps the statement of his fellow thinker Samuel Huntington, issued at the same time about the clash of civilizations after the disappearance of the capitalist-communist struggle, is correct, but in a different form: the struggle of barbarians.

Terrorism, whether carried out by countries or organizations, invasions, such as the invasion of Ukraine, and the threat of aggression, not to mention the failure to settle the last colonialism, the Israeli colonization of Palestine, are all barbarities that make globalization and the ideas that accompany it – free trade and economic openness – hopes that will not be achieved as easily as hoped.

While rich countries are trying to return industries to their lands after they were forced to move to other countries, including countries that have turned enemies, including the microchip industry, poorer countries are still victims of globalization before, during, and after globalization.

A glimpse of history: Microchips on the map of geopolitical conflict

The microchip was pioneered by Jack Kilby and Robert Noyce in the United States. In 1959, the former, a physicist at Texas Instruments, obtained a patent for his creation of miniaturized electronic circuits, while the latter obtained a patent at Fairchild Semiconductor Corporation, who built on an invention.

The planar process for manufacturing chips was developed by another physicist at the same company, Jan Horney, on a similar document for his invention of a microchip on a silicon substrate.

With the launch of the chip industry, a patent war broke out between the two companies, which was soon settled in 1966 with joint patents.

Kilby won the Nobel Prize in Physics

In 2000, Kilby won the Nobel Prize in Physics in recognition of his invention, and in the speech he gave on the occasion, he did not forget to mention Noyce, who had died 10 years earlier.

The breakthrough represented by the invention is the ability to reduce the size of electronic devices, and the comparison between today’s smallest portable computer and the smallest early computers, each of which filled a room, is only a simple indication of this development.

Since 1979

Since 1979, computer central processing units began to be placed on microchips, and microprocessing devices took off, and with them the computer revolution.

The spread of chips has expanded to include scientific equipment, weapons, entertainment devices, communication devices, vehicles, and many others, in addition to computers.

In the first decade of the twenty-first century, computer costs, and thus their prices, witnessed successive declines thanks to the development of microchips.

Before the chip, electronic devices relied on the three-electrode vacuum tube, which was invented by American Lee De Forest in 1907 and allowed changes in any current to be amplified by using the signal to be amplified to control the flow of a stronger current.

The invention led to landmark inventions, such as radio, television, and electric computers, but it was relatively fragile, bulky, energy-intensive, expensive, and easily damaged.

Bell Labs physicists John Bardeen

In 1947, Bell Labs physicists John Bardeen, Walter Brattain, and William Shockley invented a transistor that performed the functions of a tripolar vacuum tube without the problems, even though it was relatively bulky and fragile. The microchip came 11 years later, accompanied by the revolution it brought about.

One of the historical milestones that the chip was known for was its use in 1962 in the American nuclear-tipped intercontinental ballistic missile known as “Minut Man.” Its role was to operate the computer that guided the missile.

Apollo Moon program.

The US government funded the manufacture of microchips for the Apollo Moon program. The program, which was managed by the National Aeronautics and Space Administration (NASA), was able to deliver the first human mission to the moon in 1969.

The development of the chip quickly accelerated thanks to its lucrative returns and in light of consumers’ desire for electronic devices that were increasingly advanced, lightweight, portable, and at affordable prices.

In the 21st century, the average desktop computer has a million times more memory than the Apollo computers, and the machine performs calculations thousands of times faster.

Microchips on the map of geopolitical conflict

In the past 40 years, the number of electronic components that can be housed on a microchip has doubled every few years.

Many scientists expect that the ability to miniaturize the chip will stop after a few years, as there is a limit to everything, but today there is no alternative to the microchip on the horizon that can resume the process of miniaturization.

The production of microchips requires huge factories that cost billions of dollars and require upgrades every few years to keep pace with the development of this technology. The process of making a chip is essentially the same as it has been for decades: “bombarding” a piece of silicon with atoms of different elements. Microchips on the map of geopolitical conflict