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Yes. The "size" you are talking about is the "process node". It's basically a shorthand for how large the transistors are. These nodes are not fungible, once a

Yes. The "size" you are talking about is the "process node". It's basically a shorthand for how large the transistors are. These nodes are not fungible, once a chip is designed and a mask set is taped out it must be fabricated on that specific process node. Even if you have a chip designed on an older/larger node, it cannot be fabricated on a newer/smaller node without significant expense and delay. Older nodes are generally in lower demand, although strictly speaking they are a tighter supply bottleneck, since nobody is incentivized to build fabs at older process nodes. But the picture is even more complicated than this. Virtually all semiconductor fabs specialize in certain kinds of chips. Even at roughly the same process node, a DRAM fab cannot easily retool to make NAND, a NAND fab cannot easily retool to make logic (CPU, GPU, FPGA...), a logic fab cannot easily retool to make MEMS or image sensors, and so on. In fact, not only are individual fabs tooled to make particular kinds of chips, but individual fab operators will generally have their own "design rules" at a certain node. So suppose that you have an ASIC you've been making at TSMC 22nm; just because GlobalFoundries has capacity at 22nm doesn't necessarily mean you can just have them start making your chips.

code_biologist 5y ago
Your reply looks carefully written but "is there any truth to that statement?" "Yes." confuses me. Maybe the parent's question is not well formed. Would the best direct answer be? I have met so many people that think their semiconductor manufacturing needs are exempt from the supply chain issue or backlog. [because they are not on a leading node] Their semiconductor manufacturing needs are not exempt from the supply chain issue or backlog. [for the reasons you explained]
- nwiswell 5y ago
  I meant "Yes, there is truth to the statement" in the sense that some market participants are "exempt from", or more accurately "not constrained by", supply chain issues or backlog problems because their specific process nodes are not capacity impacted, and the fungibility problem acts to ensure it stays that way. I actually did not mean to say that leading nodes are the only ones impacted; that's not the case. The landscape can be surprising at a glance because there's no obvious rhyme or reason to who and what is capacity impacted. Before fabs get greenlit for construction, the beancounters do demand forecasts many years out into the future (getting the first chips out of a fab is a labor of many years). If those forecasts were high, there is overcapacity and prices will settle relatively low for that node. If they were low, then there will be capacity issues. Over time, trailing nodes will get "arbitraged" because chip designers for new devices that are cost-sensitive or not performance-critical will preferentially select cheaper nodes, but acute changes in demand like we've seen from COVID can still cause problems.

code_biologist 5y ago

Your reply looks carefully written but "is there any truth to that statement?" "Yes." confuses me. Maybe the parent's question is not well formed. Would the best direct answer be? I have met so many people that think their semiconductor manufacturing needs are exempt from the supply chain issue or backlog. [because they are not on a leading node] Their semiconductor manufacturing needs are not exempt from the supply chain issue or backlog. [for the reasons you explained]

nwiswell 5y ago
I meant "Yes, there is truth to the statement" in the sense that some market participants are "exempt from", or more accurately "not constrained by", supply chain issues or backlog problems because their specific process nodes are not capacity impacted, and the fungibility problem acts to ensure it stays that way. I actually did not mean to say that leading nodes are the only ones impacted; that's not the case. The landscape can be surprising at a glance because there's no obvious rhyme or reason to who and what is capacity impacted. Before fabs get greenlit for construction, the beancounters do demand forecasts many years out into the future (getting the first chips out of a fab is a labor of many years). If those forecasts were high, there is overcapacity and prices will settle relatively low for that node. If they were low, then there will be capacity issues. Over time, trailing nodes will get "arbitraged" because chip designers for new devices that are cost-sensitive or not performance-critical will preferentially select cheaper nodes, but acute changes in demand like we've seen from COVID can still cause problems.