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$1 Display Chips are One of the Primary Reasons Behind Graphics Card and Chip Shortages

Here’s something you probably didn’t expect. A $1 chip, namely the display driver (which is a key component of graphics cards, consoles, APUs, TVs, smartphones, and anything that has or runs a display) is one of the primary reasons behind the chronic chip shortages. This chip is needed for Intel’s mainstream processors lineup, both NVIDIA and AMD’s graphics cards, game consoles, and even refrigerators and automobiles with a display installed on them.

Unfortunately, the situation is going to get a lot worse before things start improving. We’re looking at early to mid-2022 for a possible resolution of the present crisis. The recent storm in Texas and the accompanying loss in electricity caused multiple plants to stop functioning and each day with no production means increasingly more pressure on the global supply chain. Furthermore, fires at some factories in Japan, Taiwan, and China also had an adverse effect on the production of not only display chips but also substrates.

One of the primary reasons why display chips despite being fairly cheap are one of the highly sought-after components that can be partly attributed to the pandemic. The stay-at-home/work-from-home lifestyle meant a boom for laptop and PC-makers and one of the key components of these devices are displays and therefore, display chips. Furthermore, many people started stocking up on indoor forms of entertainment which inevitably boils down to TVs, game consoles, and VR headsets which again require display chips, in addition to multiple other ICs.

There have been chips shortages in the past, one notable example being Intel’s 14nm shortages, but they were largely due to limited foundry capacity. This time around you’ve got bottlenecks in multiple sections of the supply chain: foundry capacity (such as TSMC’s 7nm capacity), backend OEM components (ICs such as display drivers and power management), substrates (ABF), and of course, shipping delays (a certain ship blocking a narrow canal). This time of the year, both profits and demand are on the low side, but the opposite happened this cycle, catching both chipmakers and OEMs off guard.

Source: BB

Areej

Computer Engineering dropout (3 years), writer, journalist, and amateur poet. I started my first technology blog, Techquila while in college to address my hardware passion. Although largely successful, it was a classic example of too many people trying out multiple different things but getting nothing done. Left in late 2019 and been working on Hardware Times ever since.

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