The new semiconductor race

Technology · 2026-06-15 · 8 min read

By Arjun Mehta, Engineering & product

Fabs became strategic assets, and the bottleneck moved from transistors to packaging, memory and the machines that print light.

Semiconductors turned into industrial policy because everything else depends on them. A country without access to advanced logic is a country whose cars, weapons, hospitals and data centres are built on somebody else’s permission.

The scarce parts are not where most people look. Leading-edge lithography comes from a single supplier, advanced packaging capacity is booked years ahead, and high-bandwidth memory has become the actual limiter on how many accelerators anyone can ship.

Geography makes it worse. A large share of the most advanced capacity sits in a small number of facilities within a few hundred kilometres of each other, which is a remarkable concentration for a product embedded in every part of modern life.

Subsidy programmes are rebuilding capacity elsewhere, slowly. Fabs take years, cost tens of billions and need engineers who do not exist yet in the destination country, so announcements outrun output by a wide margin.

For anyone buying hardware rather than making it, the lesson is to design for availability: qualify two parts where you can, treat long lead times as a design constraint, and stop assuming the component you prototyped with will still be orderable at volume.

Tags: chips, hardware, supply-chain

Arjun Mehta — Arjun writes about web performance, developer tooling and applied AI for ESPYCRUX. He has spent the last decade building and maintaining production web apps, and most of his articles start from something that broke in one of them.