What it means for the future of Intel and AMD

  • China’s push for technological independence has shaken up the semiconductor industry, influencing major companies like Intel and AMD.
  • Intel’s ambitious expansion into the US and AMD’s strategic product launches in China highlight the evolving strategies of semiconductor leaders amid global technology tensions.

Ongoing tensions between China and the United States are further escalating, with China introducing guidelines to phase out American microprocessors from government computers and servers, including those from Intel and AMD. The effort is part of the Chinese government’s broader strategy to replace foreign technology with domestic alternatives.

of financial times reports that the directive goes beyond hardware and targets replacing Microsoft’s Windows operating system and foreign database software with local versions. The move reflects a nationwide push towards technological independence known as “Xinzhuang” (IT application innovation).

China’s domestic focus and US countermeasures

Amid rising tensions, China’s latest procurement rules represent a major effort to foster domestic alternative technologies. These moves reflect actions by the United States, which has increased sanctions on Chinese companies for security reasons, legislation to boost domestic technology production, and restrictions on advanced chip exports to China.

The rules, carefully announced last December and effective this year, require government agencies and political parties to prioritize “secure and reliable” technology in IT purchases, with an emphasis on indigenously produced processors and operating systems. It is mandatory.

On the day this guideline was introduced, China’s Information Technology Security Assessment Center recognized that approved products only come from Chinese sources, including processors from companies such as Huawei and Fitium, which are blacklisted by the U.S. government. “safe and reliable” technologies were included in the list. These processors utilize a variety of chip architectures and their operating systems are derived from open source Linux.

The shift towards indigenous technology extends beyond the government sector. State-owned companies have been told to transition to local providers by 2027, a move that will have significant financial implications for US tech giants such as Intel, AMD and Microsoft, which have significant sales in China. To approve their products in the future, they will need to share detailed R&D documentation and evidence of significant local development.

China has started blocking Intel and AMD chips on government computers

China has started blocking Intel and AMD chips in government computers (Source – X)

While there is still room for foreign technology acquisition, local and state treasury departments are ensuring widespread compliance with the new guidelines. Nevertheless, there is a clear trend toward domestic technology, with officials pointing to the need for additional justification for foreign processor purchases.

This trend toward indigenous technology is expected to accelerate, especially in server processors, due to a simpler transition in the software ecosystem, and a significant shift in China’s commitment to technological independence and global technology supply and demand dynamics. The potential for change is emphasized.

What’s next for Intel and AMD?

Recent challenges facing Intel and AMD, particularly China’s efforts to eliminate U.S. microprocessors in favor of domestic options, come at a critical time for both companies. For Intel, this rolls out as it embarks on an ambitious expansion in the US, with plans to invest $100 billion over five years to create “the world’s largest AI chip manufacturing hub.”

quartz Intel CEO Pat Gelsinger is reportedly looking to establish a major manufacturing facility near Columbus, Ohio. The effort is part of a major investment across four states, with construction potentially starting as early as 2027. The effort, supported by approximately $20 billion in federal funding and the Biden administration’s CHIPS and Science Act loans, is aimed at strengthening U.S. semiconductor leadership.

The CHIPS and Science Act allocates up to $8.5 billion in direct funding to Intel and makes it eligible for an additional $11 billion in financing to increase its semiconductor manufacturing presence in Arizona, New Mexico, Ohio, and Oregon. I am.

At a recent event featuring President Joe Biden at Intel’s Arizona campus, Gelsinger highlighted the benefits these investments will bring to the nation’s economy and security. He emphasized the important role of semiconductors in the digital transformation of society and argued that chip production is the basis of humanity’s future.

Gelsinger also addressed the competitive aspects of these efforts, emphasizing the importance of maintaining leadership in the semiconductor space, especially in light of the U.S.-China chip race and rapid advances in AI technology. .

Although the United States once dominated semiconductor development, it now produces less than 10% of the world’s chips and is not involved in the manufacturing of cutting-edge semiconductors.

Intel’s strategic investments are expected to create approximately 80,000 jobs, including direct jobs within the company and indirect roles in construction, suppliers and related industries. In addition, Intel plans to take advantage of U.S. Treasury tax credits worth up to 25% on eligible investments exceeding USD 100 billion.

This contrast between Intel’s aggressive expansion in the US and the challenges posed by China’s new procurement policies outlines a complex scenario. For Intel, and by extension AMD, China’s move toward domestic technology could mean significant market losses.

However, Intel’s significant investment in U.S. manufacturing and government support signals a strategic shift toward strengthening domestic semiconductor production. This is not just an economic strategy, but a measure of national security and technological sovereignty in the face of global competition.

AMD’s innovative response in China

So that’s what’s happening at Intel. However, recently AMD has been attracting attention in China as well. AMD’s recent appearance in China, featuring the Ryzen AI PC Innovation Summit in Beijing, showcased the announcement of the Ryzen 8040 series and 8000G desktop solutions tailored for the Chinese market.

AMD and Intel’s practice of adding an “F” suffix to processors without onboard graphics is likely due to iGPU performance issues during manufacturing and represents a unique strategy. Rather than being thrown away, these units are reused and sold at low prices, making them attractive to PC enthusiasts who prefer discrete graphics cards over integrated GPUs.

tom’s hardware The Ryzen 7 8700F and Ryzen 5 8400F highlight AMD’s competitive strategy at different price points. This strategy has ensured a wide range of products from his affordable Athlon 3000G to the Ryzen 5000 series, and now includes Ryzen 8000 desktop APUs (without graphics), increasing the options available to AM5 motherboard owners. Let’s expand further.

Details about the Ryzen 7 8700F and Ryzen 5 8400F are unknown (for now), but we’re guessing they share similarities with the AMD Ryzen 8000G series 65W Phoenix APU, despite not having an iGPU. It’s reasonable. For example, the 8-core/16-thread Ryzen 7 8700G based on the Zen 4 architecture boasts up to 5.1 GHz boost speed and 65 W TDP, along with the powerful Radeon 780M GPU. The F-series likely has the same CPU specs, but noticeably lacks onboard graphics.

Without the Ryzen 5 8400G, it’s difficult to guess the specifications of the Ryzen 5 8400F. However, this new Ryzen 5 variant follows the Zen 4 architecture but lacks integrated graphics and could feature a 6-core/12-thread (or possibly 6-core/6-thread) CPU configuration there is.

It’s important to note that the Ryzen 7 8700F and Ryzen 5 8400F may be exclusive to the Chinese market. This avoids any speculation regarding price compared to equivalent products with a G suffix. HXL’s speculation suggests that these products are only intended for China, but AMD’s region-specific products are Historically, we have expanded into international markets.

This strategic move by AMD, as Intel is investing heavily in expanding U.S. semiconductor manufacturing, reflects broader dynamics of global technology competition and adaptation. Efforts in China and the United States highlight the complex balance between local adaptation and global strategic positioning, as both companies navigate international market complexities and political tensions.

As China moves forward with its plans for technological independence, semiconductor giants like Intel and AMD are feeling the ramifications deeply. The unfolding scenario highlights a pivotal moment in the semiconductor sector, highlighting the complex dance between national ambitions and the interconnectedness of the global technology ecosystem.

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