PC hardware culprit is actually it!
Since 2017, PC hardware seems to have entered a vicious circle.
The first is that SSD is not able to increase the price due to the lack of 3D NAND transformation capacity. The next step is that the virtual currency heats up the price of the graphics card, and then there is a large amount of memory for smart phones. In short, there is a keyword: price increase!
In fact, not only PC hardware but also semiconductor-related industrial chains are basically increasing their prices in 2017.
In early 2017, Meizu announced that its 16GB and 32GB versions of its Note5 mobile phone price rose by 100 yuan. The reason for this increase was due to rising BOM costs. (BOM Chinese means a bill of materials. Popularly speaking, BOM is to integrate the product structure, process flow, etc. of a certain product. Through the BOM bill, you can clearly know the cost price of a major part of a mobile phone. In other industries, BOM prices are rarely announced.) After that, Lenovo, Xiaomi, Meizu, LeTV, and Jinli have all announced price adjustments for their products, and have started to increase prices.
Such electronic product price hikes not only lower consumer demand, but also hamper Moore's law that “the computer performance that every dollar can buy will more than double every 18-24 months.”
The culprit of this price rise is the rise in global silicon wafer prices.
Price culprit: Global silicon wafer prices rise
No matter whether it is a PC or a smart phone, it is inseparable from an important raw material: silicon wafers.
A silicon wafer refers to a silicon wafer used in the manufacture of silicon semiconductor integrated circuits. Since it has a circular shape, it is called a wafer. CPUs, FLash, and DRAMs are all cut using wafers (different wafer uses are different).
The price of silicon wafers was very stable in previous years, but it suddenly rose by 10% in the first quarter of 2017.
It is understood that the average price of the original polished 12-inch polished silicon wafer is 50-60 US dollars per tablet, and the epitaxial silicon wafer is 80 US dollars per tablet, which has increased by 10% in the first quarter. The average price of high-end silicon wafers below 20 nm was originally around US$120, which has been adjusted to between US$10 and US$130 in the first quarter.
In the second quarter, the prices of silicon wafers continued to rise, and the cumulative increase has exceeded 20%. The contract price in the third quarter since July began to increase by around 10%.
Although silicon wafers account for only 5-6 percent of the cost of semiconductor products, compared to the past generations of 90 nanometers, this round of silicon wafer price increases are limited to the cost of manufacturers, but in the face of the huge volume of semiconductors today. In terms of market, the price increase of silicon wafers has a huge impact on the price of electronic products.
Why is the price of silicon wafers rising?
The price increase of silicon wafers is actually caused by the underestimation of future silicon wafer fabs' market demand. Although silicon wafers are a high-tech industry, the profitability of silicon wafers is still very low compared to that of chip manufacturers.
In previous years, almost all major silicon fabs were losing money, so they were reluctant to increase silicon wafer production capacity. In recent years, the rise of higher-order processes has raised the requirements for silicon wafers. However, despite the overcapacity of silicon wafers, there are few manufacturers that can provide 10 and 7-nm-size silicon wafers. The process of manufacturing silicon wafers has become a commodity shortage, coupled with the global expansion of 3D NANDFlash, and the expansion of the mainland's 12-inch plant, leaving global silicon wafers in a frenzy of shortage.
The increase in the price of silicon wafers in this round is not the previous Xiaoyangchun. The true essence of the wafer price is that the poor supply demand formed by the rapid development of technology products in 2016 will be formed. The entire semiconductor industry chain triggered by this round of silicon wafer price increase is of far-reaching significance, and it is difficult for us to estimate what will happen to the technology industry in the end.
However, it can be foreseen that the supply of memory caused by the increase in silicon wafer prices is tight and there is a demand for price increase. At the same time, the increase in costs can be transmitted to consumer chip manufacturers and terminal mobile phone manufacturers, so the price cycle of electronic products will be as long as 3-5 years, and this price increase can only be paid by the average consumer.