8 months ago • 2 mins
What’s going on here?
Samsung, the South Korean electronics titan, is gearing up for a big leap in the tiny world of semiconductors – announcing plans to make the world’s smallest chips by 2025.
What does this mean?
Taiwan’s TSMC is currently king of the hill, boasting a hefty 59% market share that completely dwarfs Samsung’s 13%. But with the rise of AI and a potential semiconductor boom on the horizon, Samsung’s now ready to shake things up. The company just unveiled plans to ship minuscule two-nanometer chips – that’s two billionths of a meter – in just a couple of years. And that gambit will put it toe-to-toe with TSMC, which also has some tidy little two-nanometer plans in the works.
Why should I care?
For markets: The never-ending race.
Gordon Moore, the original chip guru, observed that the size of semiconductors halves about every two years. That means we can pack more and more chips into our devices, computers, and cars as time goes on – unlocking increasingly sophisticated capabilities. So, while two nanometers might seem microscopic, the race won’t stop there. Next up, one nanometer, then a half, then a quarter… You get the idea. That’s great news for tech enthusiasts – but it’s a dream come true for firms selling chipmaking equipment.
The bigger picture: Proceed with caution.
Semiconductor capacity is being ramped up in the US and Taiwan, all in anticipation of a big chip boom. After all, with demand for chips set to skyrocket, no one wants to be turning away orders. But here’s the thing: if this boom doesn’t happen as expected or gets delayed – let’s say, due to a recession – chipmakers could find themselves in a tight spot. And instead of turning gung-ho customers away, they might be left scrambling to make sales targets instead.
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