Makers like Apple, Samsung, and Huawei buy lots of chips. They buy lots of semiconductors,” O’Donnell wrote. “Demand for cloud computing services from providers like AWS, Microsoft Azure and Alibaba continues to skyrocket. The pandemic played a big role, said Glenn O’Donnell, vice president research director at Forrester, in a recent blog post. The role of the pandemic in the global chip shortage Likewise, Apple and other smartphone makers also placed large chip orders, “which kept the foundries extremely busy, then you had the sudden increase in demand for COVID-19,” Gupta said. “They knew they couldn’t procure chips for their products … so they placed big orders.” This meant Huawei, one of the largest 5G smartphone makers in China, couldn’t buy chips after a certain time, Gupta said. placed on China before the pandemic, said Gaurav Gupta, a vice president analyst at Gartner. Trade sanctions and phone rollouts added to global chip shortageĮarlier this month, Gartner analysts said they expect the worldwide semiconductor shortage to last until the second quarter of 2022.Īdd to this rollout of the 5G smartphone and the trade sanctions the U.S. These include the big eight cloud infrastructure providers, which saw demand skyrocket when people began working from home and children were attending school remotely, causing a massive spike in PCs, tablets and consumer electronics, he said. “So a lot of disgruntled suppliers found other markets that were still doing well despite the pandemic.” During the second quarter of 2020 automotive OEMs “shut down, as did most of the world, but as they did that they canceled orders from a lot of the supply chain,” Morales said. SEE: Global chip shortage: The logjam is holding up more than laptops and cars and could spoil the holidays (TechRepublic) Poor planning is one cause of global chip shortageĪnother problem is poor planning. Many are also not investing in “what we’d call legacy technology,” Morales said. One of the issues is there isn’t the return on investment to build foundries to satisfy the demand by the automakers, said Mario Morales, program vice president of the semiconductor group at IDC. The shortage is being felt acutely in the automotive industry and will for as long as two years, analysts say. Manufacturing is making a comeback in most industries after languishing during the pandemic and supplies of chips-used to operate most devices-are in short supply.
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How to hire an IoT Architect (TechRepublic Premium) Zero-carbon, equitable and feeless: Recoding the blockchain The metaverse faces more than 8 potential cyberthreats Gartner identifies 25 emerging technologies in its 2022 hype cycle Image: Chris Ratcliffe/Bloomberg/Getty Images More about Innovation For more info, visit our Terms of Use page. This may influence how and where their products appear on our site, but vendors cannot pay to influence the content of our reviews. We may be compensated by vendors who appear on this page through methods such as affiliate links or sponsored partnerships. The global chip shortage: What caused it, how long will it last?Īnalysts offer observations on why it happened, the industries that will and won't be prioritized and what to expect in the short term.
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