The US government has recently expanded export controls on high bandwidth memory (HBM) chips to China, targeting crucial technology components essential for artificial intelligence applications and high-performance computing.
The basics of HBM technology: High bandwidth memory represents a significant advancement over traditional DRAM, offering superior data storage and transmission capabilities.
- HBM consists of stacked memory chips that can process and store data more efficiently than conventional memory
- These chips are vital components in graphics cards, data centers, autonomous vehicles, and AI applications
- As semiconductor expert G Dan Hutcheson explains, HBM is as essential to AI as memory is to the human brain
Strategic implications: The latest export restrictions are part of a broader US strategy to limit China’s access to advanced technology with potential military applications.
- This marks the third round of chip-related restrictions from the Biden administration in three years
- Beijing has retaliated by restricting exports of critical materials like germanium and gallium
- While the restrictions may temporarily limit China’s access to advanced HBM, experts suggest the country will eventually develop independent production capabilities
Market dynamics: The global HBM market is currently dominated by a small group of established manufacturers.
- SK Hynix leads with 50% market share, followed by Samsung at 40% and Micron at 10%
- The Korean manufacturers are expected to maintain approximately 95% market share through 2024
- Micron aims to increase its market presence to 20-25% by 2025
Technical complexity: The manufacturing process for HBM involves sophisticated engineering and precise assembly techniques.
- The total height of an HBM stack is approximately equal to six strands of hair
- Each layer must be extremely thin and precisely manufactured
- The process requires drilling precise holes for electrical connections between layers
- The complexity of manufacturing is reflected in HBM’s significantly higher price compared to conventional memory chips
Future market outlook: HBM is positioned to capture an increasing share of the memory chip market.
- HBM is expected to represent over 20% of the standard memory chip market value by 2024
- Market share could exceed 30% by 2025
- Chinese manufacturers Yangtze Memory Technologies and Changxin Memory Technologies are working to develop domestic HBM production capabilities
Strategic considerations: The competition for HBM technology highlights the growing tension between technological advancement and national security concerns in the semiconductor industry, with implications for both global supply chains and geopolitical relationships.
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