Book Review: Chip War: The Fight for the World's Most Critical Technology

In the 19th century it was coal and steel, in the 20th century it was oil and gas, what will it be in the 21st century? The answer, according to Chris Miller in this lively and sweeping book, is semiconductor chips.

There is little doubt that chips are ubiquitous, not just in our computer and cell phones but in our washers and dryers, our dishwashers and ovens, our cars and sprinklers, in hospital monitors and security systems, in rockets and military drones. Modern life as we know it would be unimaginable without these marvels of silicon and germanium. And as Miller describes, we have a problem because much of the technology to make these existential entities is the province of a handful of companies and countries that are caught in geopolitical conflict.
Miller starts by tracing out the arc of the semiconductor industry and its growth in the United States, driven by pioneers like William Shockley, Andy Grove and Gordon Moore and fueled by demands from the defense establishment during the Cold War. Moore's Law has guaranteed that the demand and supply for chips has exploded in the last few decades; pronouncements of its decline have often been premature. Miller also talks about little-known but critically important people like Weldon Ward who designed chips that made precision missiles and weapons possible, secretary of defense Bill Perry who pressed the Pentagon for funding and developing precision weapons and Lynn Conway, a transgender scientist who laid the foundations for chip design.
Weldon Ward's early design for a precision guided missile in Vietnam was particularly neat: a small window in the tip of the warhead shined laser back to a chip that was divided into four quadrants. If one quadrant started getting more light than the other you would know the missile was off-course and would adjust it. Before he designed the missile, Ward was shown photos of a bridge in Vietnam that was surrounded by craters that indicated where the missile had hit. After he designed his missile, there were no more craters, only a destroyed bridge.
There are three kinds of chips: memory chips which control the RAM in your computer, logic chips which control the CPU and analog chips which control things like temperature and pressure sensing in appliances. While much of the pioneering work in designing transistors and chips was spearheaded by American scientists at companies like Intel and Texas Instruments, soon the landscape shifted. First the Japanese led by Sony's Akio Morita captured the market for memory or DRAM chips in the 80s before Andy Grove powerfully brought it back to the US by foreseeing the personal computer era and retooling Intel for making laptop chips. The landscape also shifted because the U.S. found cheap labor in Asia and outsourced much of the manufacturing of chips.
But the real major player in this shift was Morris Chang. Chang was one of the early employees at Texas Instruments and his speciality was in optimizing the chemical and industrial processes for yielding high-quality silicon. He rose through the ranks and advised the defense department. But, in one of those momentous quirks of history that at the time sound trivial, he was passed over for the CEO position. Fortunately he found a receptive audience in the Taiwanese government who gave him a no-strings-attached opportunity to set up a chip manufacturing plant in Taiwan.
The resulting company, TSMC, has been both the boon and the bane of the electronics age. If you use a device with a chip in it, it has most probably been made by TSMC. Apple, Amazon, Tesla, Intel, all design their own chips but have them made by TSMC. However it does not help that TSMC is located in a company that both sits on top of a major earthquake fault and is the target for invasion or takeover by a gigantic world power. The question of whether our modern technology that is dependent on chips can thrive is closely related to whether China is going to invade Taiwan.
The rest of the supply chain for making chips is equally far flung. But although it sounds globalized, it's not. For instance the stunningly sophisticated process of extreme ultraviolet lithography (EUV) that etches designs on chips is essentially monopolized by one company - ASML in the Netherlands. The machines to do this cost more than $100 million each and have about 500,000 moving parts. If something were to happen to ASML the world's chip supply would come to a grinding halt.
The same goes for the companies that make the software for designing the chips. Three companies in particular - Cadence, Synopsys and Mentor - make 90% of chip design software. There are a handful of other companies making specialized software and hardware, but they are all narrowly located.
Miller makes the argument that the future of chips, and therefore of modern technology at large, is going to depend on the geopolitical relationship especially between China and the United States. The good news is that currently China lags significantly behind the U.S. in almost all aspects of chip design and manufacturing; the major centers for these processes are either in the U.S. or in countries which are allies of the U.S. In addition, replicating machinery of the kind used for etching by ASML is hideously complicated. The bad news is that China has a lot of smart scientists and engineers and uses theft and deception to gain access to chip design and making technology. Using front companies and legitimate buyouts, they have already tried to gain such access. While it will still take years for them to catch up, it is more a question of when than if.
If we are to continue our modern way of life that depends on this critical technology, it will have to be done through multiple fronts, some of which are already being set in motion. Intel is now setting up its own foundry and trying to replicate some of the technology that ASML uses. China will have to be brought to the bargaining table and every attempt will have to be made to ensure that they play fair.
But much of the progress also depends on funding basic science. It's worth remembering that much of the early pioneering work in semiconductors was done by physicists and chemists at places like Bell Labs and Intel, a lot of it by immigrants like Andy Grove and Morris Chang. Basic research at national labs like Los Alamos and Sandia laid the foundations for ASML's etching technology. Attempts to circumvent Moore's Law will also have to be continued to be made; as transistors shrink down to single digit nanometer sizes, quantum effects make their functioning more uncertain. However there are plans to avoid these issues through strategies like stacking them together. All these strategies depend on training the next generation of scientists and engineers, because progress on technology ultimately depends on education.

1 comment:

  1. "China will have to be brought to the bargaining table and every attempt will have to be made to ensure that they play fair"

    The problem isn't China. Look in the mirror.

    The USA is no longer 'agreement capable'. No one trusts it, nor should they: it has already defaulted on its fiduciary responsibilities to three separate countries.


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