Apple Begins Testing Controversial Chinese Memory Chips

[VulchR]

The US is not a reliable trading partner these days, capacity should be built elsewhere.

Just a day ago Trump wanted to end all trade with Spain, to give one example. Also, corruption in the US has been turned up to 11. So build somewhere more stable, like Europe, Canada, Australia, New Zealand, Taiwan, Korea, or Japan.

I was thinking more for the US market, but I am no fan of he-who-must-not-be-named and I understand your point.

Yeah, and it takes years (if not decades) to build. Micron started building fabs 3-4 years ago after the CHIPS act and if we're lucky, they'll come online later this year or next in low volume production, and may well take years to ramp to full.

More complex fabs (SoCs, GPUs, etc) take even longer (see the TSMC fabs outside Phoenix, even Intel's own Fab 42, etc). Just one bring up example: the water in the sonoran desert is just different than Taiwan, so TSMC had to take months longer on just one step to properly adjust manufacturing processes, etc for just wafer wash waster supply. Think about that across 1000s of steps, 1000s of variables.

You don't just build a fab like you build an Amazon warehouse.

I am aware - I am a scientist and I know a lab that once got different biological results on opposite sides of a hallway because of the difference in water supplies (metal piping on one side, plastic piping on another). However, the US needs to start the process of building up manufacturing again.

 

[ThomasJL]

The Tim Cook fans will praise Cook if the increased supply of Chinese RAM lowers RAM prices, and then Cook does not lower prices on Apple products containing that RAM in order to maximize profits. The Cook fans will make pathetic excuses for Cook's insatiable corporate greed by saying Cook didn't lower prices because of "inflation."

 

[picpicmac]

The Tim Cook fans will praise Cook if the increased supply of Chinese RAM lowers RAM prices, and then Cook does not lower prices on Apple products containing that RAM in order to maximize profits. The Cook fans will make pathetic excuses for Cook's insatiable corporate greed by saying Cook didn't lower prices because of "inflation."

Your fixation with Cook is unhealthy. You've been at it for a very long time. It leads you to make assertions without evidence.

 

[BGrifter]

I dunno. I think it’s nice to have some counterbalance to the sycophants and shareholders.

 

[paulvee]

I wonder if this is for devices that are for sale in China? That would resolve any US DOD security problems.

It explicitly said so in the article. No need to wonder. Just read it.

 

[bmustaf]

I was thinking more for the US market, but I am no fan of he-who-must-not-be-named and I understand your point.



I am aware - I am a scientist and I know a lab that once got different biological results on opposite sides of a hallway because of the difference in water supplies (metal piping on one side, plastic piping on another). However, the US needs to start the process of building up manufacturing again.

Yeah, we need to, but unfortunately, the stark reality is the American consumer has very frequently (despite loving to temporarily drape themselves in the American flag when convenient and they don't have to pay for it) has decided that by and large, they do not want to pay for Made in America when it REALLY comes down to it and no one is watching (e.g. when clicking the checkout button).

It's how we did this to ourselves to begin with largely, IMO. China didn't "do this to us", they just did what we wanted them to do (and our leaders over the course of many decades from all parties have aligned us for): become the low cost, high volume producer for goods that cannot be produced domestically at the price, environmental impact, working conditions, etc demanded by the US consumer.

Until and unless the US consumer consistently, across many markets, geographies, and buying behaviors does a few things, we'll fail in the "made here" program in the mid and long term (although in the short term it's looking good, it's far from being even close-to-term and has largely been done, so far, as a political stunt to gain some populist cred, much like Biden's stunts with the CHIPS act, etc, none of these solutions of either party are much more than that IMO - so equally just flaccid posturing for the electorate, Biden's delivered with his typical incoherent blather and Trump's his also incoherent bluster, funny how similar they are when people think they're so different):

1. Support education and a labor force that can and will work in these facilities
2. Pay up for the money in taxes and higher prices everywhere (including the pump, the water bill, the energy bill, etc) it's gonna take to build a full domestic supply chain for these facilities (many of these aren't nearly as clean and neat as fabs...)
3. Pay up at the checkout for higher prices
4. They're gonna have to have data centers, foundries, power plants, solar farms, wind farms, natural gas turbines, and even dirty old oil in and/or near their backyard

Personally, I hope we do this (and still keep a high standard on air, water, etc quality), because it's worth paying for and not cutting corners on. Unfortunately, the US consumer by and large doesn't feel that way if their actions are a proxy for understanding/inferring their feelings on some or all of the above, because we've basically chosen to say "we don't want to do that, and we'd rather offshore the impact of what it takes to cut corners on that", and, well, we have avoided having that stuff in our backyard and the higher price associated with sustainable development of whats needed to feed our desire for goods we want to buy and enjoy, but with that also comes the off-shoring of that investment, the talent it generates, and the infra it demands.

We have only ourselves, and our "leaders" to blame (and maybe the generation before us and their "leadership").

 

[dblissmn]

We need the Biden industrial policy back. And, while we're at it, to recognize the Chinese approach for what it is -- mercantilism with a heavy dose of dumping.

Biden supported education, workforce training and industrial development. Trump has cut all three. Biden heavily subsidized tech manufacturing with the result that it soared; Trump has cut that back, with the result that imports have gone up. Biden's approach meant more domestic capacity; Trump's means shortages and more imports.

And globally, fewer and fewer countries are willing to leave things to chance when it comes to trade. So leaving it to the consumer is not an option, not unless we're OK drowning in foreign debt and locking long-term rises in inflation in place.

 

[webkit]

I’m all for anything that increases American dependence on Chinese manufacturing. That’s how wars are prevented.

It can go both ways (cause wars or prevent wars, depending on circumstances). The U.S. and Japan were pretty strong trading partners prior to 1941 e.g., Japan relied heavily on U.S. for oil, iron and steel, copper, cotton, machinery and machine tools, etc. If one country relies heavily on another for important goods/materials, things like economic sanctions can greatly increase tensions. Tensions that can lead to war/conflict.

Too much dependence on another country, especially a country with different political, social, etc. views, can be problematic.

 

[anthonylambert]

1. - Even if Apple and other DRAM purchasers had paid a 20% premium in 2023 and this had given the "Big Three" DRAM manufacurers enough money to build two or three extra mega-fabs, those factories wouldn't be producing consumer RAM today anyway. Because HBM (High-Bandwidth Memory) sells at a 70%+ profit margin compared to the very thin margins of commodity PC RAM, memory executives would have immediately stuffed those hypothetical new factories with specialized HBM-manufacturing equipment that would use even more silicon waferage for HBM. They would still be selling 100% of that capacity to Nvidia, Microsoft, and Google. The consumer market would still be starving for standard DRAM because currently a wafer use to make DRAM for a laptop or desktop computer is a wafer wasted in the eyes of a chipmaker's shareholders.

That is largely nonsense. You can't just produce data centers full of DRAM. They have to share it out. Without laptops, desktops, watches and phones etc... all containing DRAM there would be no use for the data centres. They would have no customers as there would be no new client machines to use the data centers.

The average consumer buying a 16GB Mac or a 32GB PC, or one with the higher RAM configurations you cite, provides RAM manufacturers with a profit level that's now a drop in the bucket compared to what they make selling HBM RAM to companies making AI data centers.

single AI server cluster requires terabytes of HBM, and because HBM requires stacking chips vertically, it physically consumes 3 to 4 times the raw silicon wafer space of standard consumer RAM. The current DRAM shortage isn't because people have been buying computers recently with more RAM, or even because RAM manufacturers didn't build more manufacturing capacity for them to keep up with that demand. It's because AI data centers are devouring 20% to 25% of the entire world's raw silicon wafer output.

Building a cutting-edge memory fabrication plant takes 2 to 3 years and costs upwards of $20 billion per facility, and you need a massive, global network of them to achieve economies of scale. And RAM manufacturing isn't Apple's part of Apple's business anyway. They don't even make their own A-series or M-series processors, and instead they outsource that to TSMC.

Server may have a lot of ram but there aren't so many of them, Apple and others sell 100's of millions of devices.

Well Apple never used to design Processors or Mobile 4/5g modem chips either. I was suggesting they buy an existing FAB. Haven't you noticed they are eating through their suppliers doing more and more themselves. They go into more and more areas trying to cut costs and make more profit.

If Apple sunk $100 billion into building a global memory foundry network just to supply its own devices, it would significantly deflate its corporate margins, and we know shareholders don't like that.

Tim Cook did see this coming. His solution hasn't been to build a RAM factory, but to use Apple's geopolitical leverage to qualify alternative Chinese memory suppliers like CXMT to try to break the Western memory cartel's pricing chokehold.

His solution was all that was left to him. So he started culling his machines use of memory and limiting the release of new ones months ago, Macs suddenly are only available with limited memories. The rumors about using China suppliers is only in the last few weeks. Doesn't sound like someone who saw this coming. Sounds like someone trying to get Apple out of the ****.

 

[johnsawyercjs]

That is largely nonsense. You can't just produce data centers full of DRAM. They have to share it out. Without laptops, desktops, watches and phones etc... all containing DRAM there would be no use for the data centres. They would have no customers as there would be no new client machines to use the data centers.

I'm just telling you what the big three RAM manufacturers are actually doing, regardless of whether it's the wisest move, at least as far as its impact on everyone else. Apparently they consider the supply bottlenecks they've caused for the consumer RAM market to be someone else's problem, since they're now raking in the money by shifting production mainly to HBM instead of consumer RAM.

Sure, it makes sense to point out that the consumer devices that access the AI data centers need RAM to function, and that the RAM manufacturers appear to be causing themselves another problem by no longer making enough RAM for the manufacturers of those devices to keep pumping them out at the prices they had been able to, but as I say, the big three apparently don't see that as a threat to their profits, at least not for some time to come. It's likely they feel there's already enough devices (since there are currently billions of them in use) to access the AI data centers so that those centers will be put to full use anyway, at least for some years to come, and they're kicking this issue down the road while they make the profits they've long dreamed of by shifting to HBM production, which isn't subject to the cutthroat pricing demands of consumer RAM buyers like Apple.

In fact, if this consumer RAM squeeze prevents manufacturers of consumer devices from being able to profitably put enough RAM into those devices to run as much on-device AI as they want us to use (for instance, Apple planned to increase RAM from 12GB to 16GB in some iPhones, but not now), then much of the AI computing burden for users of those devices remains in the cloud, which furthers the profit goals of the big three RAM manufacturers in maintaining their preference for making data center HBM.