Intel’s Long Decline and Losing the Future Desktop Chip Battle

Intel was the dominant computer chip company for decades. Intel built this dominance on engineering execution and being the undisputed leader in lithography.

Intel was supposed to be at 10-nanometer chips using EUV (extreme ultraviolet light) in 2016. There were industry delays in enabling the transition to EUV. However, Samsung brought the first commercial EUV chips to market in 2018.

Intel was supposed to have much higher price-performance by continuing to be the leader at scaling to smaller size lithography and with larger 450 mm wafers. This was canceled.

Intel failed to become a leader with massive chip technology segments. The mobile chip market was one where Intel was not willing to compete on higher volume and lower margin. Intel has not been a leader with GPUs for graphics, high-end computing, and AI. This has been dominated by Nvidia. AMD became an effective competitor in that market.

Now Intel has at least a one year delay with its 7 nanometer chips. Intel said the launch of its 7-nanometer chips could be delayed until as late as 2023. TSMC, AMD and Nvidia all have strong 7 nanometer chips.

TSMC is even mass-producing 5-nanometer chips and they will be used in the upcoming 5G iPhones.

Intel CEO Bob Swan said the launch of his company’s first in-house 7-nanometer process-related chip products will be delayed to late 2022, or even early 2023. He also said Intel will need to look for external manufacturing partners to reduce the impact of the delay. China’s top contract chipmaker Semiconductor Manufacturing International Co. is also racing ahead to close tech gaps, with its 14-nanometer chips scheduled to go into mass production by this year.

TSMC has said its next generation of 3-nanometer technology will go into mass production by the second half of 2022.

Intel has fallen behind by about two years on pure technology and is years behind on being able to get to volume.

Intel will have to rely on outsourcing to TSMC for several years.

These are the last few years of this technology. There will need to be new technologies after 1 and 2-nanometer chips.

Intel over the last few years had an exodus of engineering and leadership talent. Intel brought in many executives and leaders from outside Intel. This was a change from a history of developing leaders internally.

Intel did not commit to dominating mobile chips or GPUs because of initial lower margins. Intel was worth more than Nvidia, AMD and TSMC combined but now those three competitors have a combined market value that is double Intel.

Intel had maintained a two-year technological lead and now they are behind by over two years.

SOURCES- Wikipedia, Extremetech, the Verge, Samsung Blog, Nikkei
Written By Brian Wang, Nextbigfuture

37 thoughts on “Intel’s Long Decline and Losing the Future Desktop Chip Battle”

  1. Surprise, being an EUV fab is hard!

    Seriously, EUV lithography is really hard, there are few places on the planet that can deal with it effectively. I can’t really say bad things about Intel regarding this because there are fundamentally so few players that work both the fab and process at these sizes. What are your alternatives? TSMC and Samsung maybe. There are some boutique fabs but that’s it.

    Now, processor design is a different story. The technical debt Intel accrued is coming back to bite them (all the speculative execution exploits, and the misguided SGX effort). At least now they are serious about mixed heterogenous core chips, and they are late to the chiplet bandwagon.

    Short term, if they want to do something interesting, is to buy ARM from Softbank. Assuming they don’t pull another StrongARM fail…

  2. These are the last few years of this technology. There will need to be new technologies after 1 and 2-nanometer chips.

    Yet we only ever see reports of technologies that are supposed to replace silicon lithography at a phantasmagoria level. Nothing close to a practical processor. So, how on earth can these be the last few years?

  3. …on the long path to being a 2nd rate Japan. At some point, India will eclipse China, because Modi and the Indian government aren’t afraid of the free exchange of ideas, and don’t need to keep their citizens under tyranny.

    The Chinese people are good people; but their government is the 21st century version of Nazi Germany. I feel sorry for the Chinese people. Hopefully, they will tire of the fear and coercion used to govern them and throw off the shackles of Big Brother CCP. Hell, even living in Putin’s Russia is better than in China under Xi’s rule.

  4. …on the long path to being a 2nd rate Japan. At some point, India will eclipse China, because Modi and the Indian government aren’t afraid of the free exchange of ideas, and don’t need to keep their citizens under tyranny.

    The Chinese people are good people; but their government is the 21st century version of Nazi Germany. I feel sorry for the Chinese people. Hopefully, they will tire of the fear and coercion used to govern them and throw off the shackles of Big Brother CCP. Hell, even living in Putin’s Russia is better than in China under Xi’s rule.

  5. Tesla is in USA, Europe, and China. BYD is only in China, and their economy is much worse than the US. China is so dependent on US and Europe. As US and Europe come to grips with how despicable the CCP is, they will slowly decouple and China will collapse.

    Tesla/SpaceX/Starlink will dwarf any other company in the world in 2-3 years. You should learn how to forecast. Starlink (a part of SpaceX) will blow the doors off ANYTHING coming out of China.

    Amazon is pervasive across US and Europe. Jack Ma wishes he could replicate Amazon outside of China. Good thing he has the CCP to protect him… Whoops, my bad! CCP chose to take over Hong Kong! Run, Jack, Run!

    Google and Facebook control most of the advertising dollars across the world. China and the CCP are terrified to let those companies in. Chinese citizens might find out how terrible their government is.

    Apple might sell overprice phones, but they are experts at keeping their customers locked into their app platform and UIX. Much more effective than the pitiful CCP.

    Microsoft is making more money off of their cloud and productivity apps. As Teams platform grows, Zoom will be left in the dust. Microsoft doesn’t really charge for the Windows platform anymore. Windows 10 is free. You should keep up with the times.

    China and the CCP only know how to steal technology and IP. As developed countries start to farm more of their manufacturing to Malaysia, Indonesia, and other Southeast Asia countries, China will slowly start…

  6. I think the article is wrong….Intel is clearly after mobile chip business with new 3D wafer stacking technology… One chip that has both the CPU, GPU and DRAMs in the same chip package… that sounds like a mobile CPU if you ask me…. I heard they were buying the DRAM wafers that were part of the 3D silicon stack from samsung…

    Apple just dumped intel because they would rather pay themselves for the CPU chips rather than intel… and they are apple… they don’t need to be compatible with any other company… they are their own standard.

  7. Not knowing the inner details of what is going on I suspect that significant time and engineering at Intel has been focused not on new processes but on fixing Meltdown and Spectre.

  8. The population of the island of Taiwan refer to themselves as TAIWANESE.

    They have a distinct language and culture that is different than mainland China and IMHO is superior to mainland China. Same goes for HKers. Distinct language, culture, legal norms and wholly superior to the concentration-camp-cult-of-personality-culture of mainland China.

  9. Intel in Silicon Valley had a purge in 2018-2019. It involved encouraging the older engineers to leave.
    The official explanation was cost cutting.
    In fact, it was about aligning the company to progressive ideology.

  10. Keeping peace in the ME will be akin to keeping peace in subSaharan Africa.

    Someone should do it… someone?… Anyone? Oh look, a new season of football is starting…

  11. Are you referring to the indigenous people of the island of Taiwan or the 95% of the population who are the Han Chinese descendants of the retreating Republic of China that setup shop on the island in 1949 and ruled under martial law thru 1987?

    Don’t forget, Taiwan is the name of an island and Republic of China is the formal state occupying that island.

  12. Is that why Tesla, SpaceX, Starlink, Google, Facebook, Apple, Microsoft, and Amazon are so unprofitable? Because they are US companies?

  13. What really killed the American will to send troops to the ME was when the USA became a net exporter of petroleum. Now instead of being a vital asset to US security, the ME has become the competition.

    If we’re exporting oil, it’s now in our best interest financially if the ME stops producing oil. If a war breaks out, the USA would be hard-pressed to muster the will to protect a foreign industry that hurts American business by existing. It would be much more in our financial interests to allow them all to kill each other and/or shut down their oil export system.

    America has already bled out several times in the last 30 years to maintain the oil supply. We spent a couple trillion dollars in Iraq last time between the war and the nation building. We barely had the political will to do this when it was in our interests. Now that we don’t have a horse in the race, it would be a near-impossibility for us to venture into another decade war.

  14. The nm claimed is only for the smallest feature, on average the resolution is much lower. The customary way of comparing semiconductor nodes’ densities is the size of an SRAM cell. (now an HD SRAM cell, not comparable with older size numbers). Samsung or TSMC 7nm have cell sizes of .026-.027 sq. micron,, while Intel 10nm is .0312 sq. micron. That’s equivalent to Intel’s true line width being only 7.5% bigger than TSMC’s, and its transistor density being just 16% lower.

  15. You know what is reallying killing US influence in the region? The US pulling out its troops. The ME is only important to our “allies” that need the fuel and US politicians that are bought and paid for by foreign entities or defense contractors.

  16. If China needs to keep people working they can just build more empty cities that no one will live in. They do have hundreds of millions of uneducated peasants that can do the work.

  17. AMD is at his best time and the CEO is not a white man. I can say that the great success of AMD right now is thanks to the leadership of Lisa Su.
    If the error is to hire the wrong people (chinese and indian people with fake degrees), then the problem is in the personnel department, which it is not doing his job. There are a lot of brilliant chinese and indian people with true degrees.

  18. This is even worst than looks like. Being “Intel friendly”, today Intel has some 10 nm chips. The number of transistor per chip escales with the area of the chip, hence the technological gap can be estimated TODAY around 10^2 / 7^2 = 2.04 times lower tech from Intel compared to the competitors -compared to the 7 nm chips-.
    If TSMC reaches 3 nm technology on the next years and Intel is not able to improve the 10 nm, the gap will be 10^2 / 3^2 = 11.1. Intel will not be able to sell any chip.

  19. For years Intel were happy to drop feed their innovation, just releasing enough each cycle to make upgrade worth while without ever leaping forward. That approach is good for shareholder profit but now the opposition have overtaken. The same will happen to Apple.

  20. Any engineering company that gains enough market share eventually becomes a financial engineering company instead.

  21. Intel’s annual gross profit for 2019 was $42.14B

    Their problem isn’t cash, it’s engineering. You better hope they continue buying useless startups.

  22. TSMC obviously outsources to innovative white men. That also explains why Microsoft is on the brink of collapse under Nadella.

  23. they need to stop spending billions buying useless israeli startups and use those billions for r&d .
    bought startups are the result of nothing but the strong and selfish influence of rich board and executive members.

  24. This might be due to the US public share trading ecology disciplining companies to deliver short term profits over long term health. Boeing and Intel have been in decline.

  25. When a company disdains low margin work, you know their days are numbered, because it’s the low margin work that disciplines you; The people who master that will later come for the higher margin work, with lower costs.

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