Skip to main content

An inside look at the chipmaking war being waged between the U.S. and China

NZXT N7 B550
NZXT N7 B550 (Image credit: Windows Central)

What you need to know

  • In key computing areas such as CPU chip design, U.S. companies dominate the global market.
  • The U.S. also routinely puts sanctions on Chinese tech corporations, throttling access to key components.
  • China is making a determined effort to disconnect itself from dependency on U.S.-based tech.

A newly published, in-depth feature from Nikkei Asia gives a detailed overview of the current state of the conflict between China and the U.S. in the sectors of chipmaking, semiconductor manufacturing, and computing technology as a whole. One of the many key takeaways the article presents is the encroaching reality that if China has its way, it will no longer depend on the U.S. for many of its computing needs, which will have big consequences for both countries.

The feature highlights that U.S.-based corporations control many spaces in computing tech, such as central processing unit (CPU) design, wherein behemoths including AMD and Intel have control over 90% of the global market. In wafer inspection, ion implantation, etching, and many other areas, U.S. businesses handle 80% of the market's business. These figures paint the picture that, when it comes to chipmaking, the United States maintains something of a monopoly in many important areas.

That fact has sat poorly with China, especially in recent years as the U.S. has continuously sanctioned the rival country's tech companies, making it increasingly unsafe for China to rely on U.S.-based businesses for any of its computing needs. At any moment, a sanction could disrupt supply chains and leave all the power in the U.S.'s hands, which is an unsustainable position that China is trying to get out of.

As such, China is focused on creating competitors to all the foreign companies currently stopping it from being self-sufficient. For every integrated circuit design company around the world, including NVIDIA, Qualcomm, and Arm, China is positioning its own Goodix, UNISOC, and Will Semiconductor Co. For chip manufacturing, China is attempting to match the rest of the world's Intel, TSMC, Samsung, and Micron options with its own Yangtze Memory Technologies, Hua Hong, and SMIC.

No matter the sector, China is working to become self-sufficient, and as tensions rise between China and the U.S., localization efforts in the country will grow. However, the two nations are still tightly interlinked, so how far this decoupling effort can go remains to be seen.

Robert Carnevale is the News Editor for Windows Central. He's a big fan of Kinect (it lives on in his heart), Sonic the Hedgehog, and the legendary intersection of those two titans, Sonic Free Riders. He is the author of Cold War 2395. Have a useful tip? Send it to robert.carnevale@futurenet.com.

15 Comments
  • Interesting how the severe chip shortage intensified after Donald Trump left office
  • While there is a possibility of these two things having a cause and effect relationship, chances are they don't, due to many new tech products coming out this past year and having a year of reduced output for many companies, it adds up.
  • It's more due to the rise of edge/IOT computing, smart cars, avionics, smartphone demand, gaming consoles, cloud/servers, and the sudden explosion of computers/laptops. Chips are in everything these days and it's only going to grow.
  • No it's not.
  • Still have no idea why no one is making chips here in the states, or at least outside of China. I know it's price and supply chain, but this article clearly states China is trying to become independent. We need to not rely on a singular country that can cut us off at any time. Just like they need to do the same.
  • It's not just semiconductors and it's not just the US.
    All the major developed countries are reevaluating their supply chains on essentials and most of the developing ones, too. Remember the shortages of face masks and ventilators last year? Vaccine manufacturing and supplies for making same this year. Semiconductors and more for the next three years. Multinational supply chains are going to give way to local assured supply chains.
    RIP globalization.
    Not necessarily a good thing but "relying on the kindness of strangers" isn't tenable.
    Look up "microfactory", "nano factory", and "shipping container factory"; "build where you sell" is getting a big boost. A new age is dawning.
  • I'm okay with it. With worldwide tensions, it's good not to rely on any singular country. We as a country should watch out for our own country first (which does not mean hindering other countries) and then the rest of the world. Plus making America a worldwide manufacturing powerhouse is not a bad thing for America or the rest of the world. Same with every single other country.
  • That's the central lesson of the pandemic.
    Folks in hurricane territory have always known it is important to be prepared for disruptions of distribution channels of essentials. Now everybody is.
    As for manufacturing, the US has always been a powerhouse, even under offshoring; the issue is the *mix* of production. Under the hoary theory of Comparative Advantage, globalization encouraged countries to specialize and become interdependent. Which doesn't work when distribution breaks down or when non economic forces intervene. The US specialized in high tech, high value products and food production, but neglected to maintain a minimal capacity in other areas.
    A rebalancing was way overdue.
  • That is a good, thoughtful summary, and fits in with what I've been reading. Thanks!
  • I don't care if you lean right or left or are in the middle. We need to stop our reliance in China ASAP.
  • This is an uncontroversial statement. Everyone is in agreement. Indeed, as the article points out, China feels the exact same about having to rely on the US. See how we have cut Huawei off at the knees. They were on their way to take on Samsung, and now ...
  • Imagine if Apple got its marching orders from DOD. It's not just the US, many western countries are ditching/limiting their use of Huawei.
    Even the German Greens have come out in favor of ditching them.
  • Huawei was actually on their way to take on Apple. Tim Cook worked with the Trump administration to make sure that wouldn't happen.
  • Did Cook work with the Aussies, Brits, Germans, and everybody else ditching Huawei?
    And he still had time to actually run Apple.
  • "Self-sufficiency in the tech sector is the key to future security" I just love how this article takes this premise at face value. All I see here and in the comments is learned-sounding confusion. "Self reliance" is not some wonderful thing, it's what you're stuck with when the rest of the world doesn't want to play ball with you anymore. It's the reason the Cuban auto sector is so vibrant.