We are drug addicts. Not to green cannabis or MDMA, necessarily, but we do are addicted to some elements scattered around the globe that support the base of the world economy and that we need, like water, so that everything remains in order. The shortage of silicon chips is already one of the most suffocating problems that humanity has to face these days, we tell you about it in this article.
A new world problem: shortage of silicon chips
Perhaps there were some smart people who knew it before, but, for the rest of the mortals, it was in 2021 when the crude dependence that the technology industry has on factories that produce microchips was revealed. Yes, those little things are absolutely essential for the operation of electronic devices.
You can now start trembling with fear, the shortage of semiconductors, of silicon chips, which work as the heads of computing devices, is not good for us. Because, as you may tell, they control everything these days, from your smartphone to your laptop, from your tablet to your new car, from your state-of-the-art washing machine to your kid’s Playstation 5.
What is this semiconductor crisis about?
As it happened with the rest of the markets, the restrictions imposed by the pandemic forced the closure of many of the factories that were devoted to the production of these chips, thus making their production more difficult. And what’s worse, on top of that, the demand for computer devices increased, since everyone was locked up at home, needing to work remotely or entertain themselves with screens so as not to die of disgust making bread or staring at the wall. To all of this we add the inevitable delay in shipments and transport on a global scale, as well as the rise in the price of silicon, an essential element for microchip manufacturing, and other components that were bitterly disputed by the great world powers. As if that were not enough, two large chip producers, Taiwan and China, suffered certain catastrophes that seriously affected the capacity of their factories.
We know that the semiconductor industry fluctuates, that it is fickle and regularly goes through certain cycles of shortage, but all of this happened at the same time: this fluctuating nature, the alteration of demand and supply patterns due to the pandemic, the disagreements between the great powers, and then the catastrophes in the countries with the highest production… Not even done on purpose!
Who has been the worst off because of the shortage?
One of the markets that has been the most affected is the automobile sector. In fact, the AlixPartners financial consultancy recalls that, due to the shortage of chips, the global automobile industry has lost, this past 2021, 210,000 million dollars in revenue. That’s about 7.7 million cars less.
But not only that, the shortage of semiconductors also threatened the availability of smartphones, tablets and other gadgets with microchips in the last months of last year, which is, as you know, when these things are sold more. The Christmas campaign.
In fact, the very Apple, during November, had to choose between its iPads and its iPhones, diverting the chips that were originally destined for the former for the latter, since the iPhones are sold more and they are more lucrative. This meant that many specialist stores in the UK didn’t have stock of the iPad mini or the basic iPad for months.
But now comes perhaps the sector that has defended the problem of silicon, chips, semiconductors and all their ancestors the most: the world of gamers. Because the universe can be sunk with a single click of Thanos but the difficulties to get the brand new PlayStation 5 or the Xbox Series X is inexcusable. Indeed, Sony had it hard. Forced, even, to stop the production of its flagship product, the PS5, because the hundreds of chips that make it up are too difficult to obtain. The same thing happened with the giant Nintendo, which warned, distressed, that they were in serious trouble. They couldn’t keep up with the demand for their new console. Meanwhile, high-end graphics cards for PC gaming are still hard to find. If things continue like this, at any moment gaming lovers will leave the controls of Call of Duty, come out of their burrow and go themselves refine the silicon.
Moving on to the aesthetic spectrum, we note that if you’re bald you might not have noticed, but the Supersonic hair dryer and Airwrap hair styler have been missing for months as tech giant Dyson continues to beg for chips among the few supplies that work selling them worldwide.
Conclusion: What will happen in the near future?
Yes, things are very bad regarding the supply of chips and semiconductor materials. Although, don’t worry, experts warn that the effects of the shortage will only take a year to subside. There will be gradual improvements, although all the demand will probably not be met before 2023.
Many companies, such as Intel, have decided to create new chip factories in Europe, America and Asia to avoid another shortage on such a scale. In the meantime, meditate, exercise, read our articles, check your security system, or try to bring back tug-of-war as an Olympic sport.
About Version 2 Limited
Version 2 Limited is one of the most dynamic IT companies in Asia. The company develops and distributes IT products for Internet and IP-based networks, including communication systems, Internet software, security, network, and media products. Through an extensive network of channels, point of sales, resellers, and partnership companies, Version 2 Limited offers quality products and services which are highly acclaimed in the market. Its customers cover a wide spectrum which include Global 1000 enterprises, regional listed companies, public utilities, Government, a vast number of successful SMEs, and consumers in various Asian cities.
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