Ed Conway Profile picture
Sep 18, 2020 19 tweets 6 min read Read on X
🧵Since it's Friday, I want to tell you a story that has nothing to do with COVID or lockdowns or any of that. A story of human ingenuity that boggles the mind. It begins with this, @apple's latest product launch this week apple.com/apple-events/s…
Now, on the face of it this keynote was a less exciting than usual. No new iPhones or Macs. Just an upgraded watch and new mid-range iPad. But anyway for me the most interesting bit of these presentations is the bit about the chips. You know: the bit where we go into the lab...
And this time around the news from the lab is genuinely exciting. The A14 chip going into the new iPad (and the new iPhone once they announce that) is built out of transistors measuring five nanometres. This is truly amazing.
The transistors in these chips are 1,000 times smaller than a red blood cell.
24 times smaller than a particle of COVID-19.
It'll be 16 times more powerful than Deep Blue, the IBM supercomputer that beat @Kasparov63 in 1997. But small enough to balance on your fingertip
There wasn't much fanfare about this (look new iPads everyone!) and it was buried away at the end of the presentation but this is a stunning achievement. And one some people thought we'd never reach. Some chipmakers have already given up on getting to these levels of complexity
True - some will moan about whether Moore's Law is coming to an end. And the speed jump from 7nm to 5nm is nothing like the exponential leaps we saw in the earlier days of computing, but at these scales the chips are running up against the laws of physics - quantum effects etc
The marvel is not only this staggering piece of engineering, more intricate than anything ever created by humankind, but that in a few months millions of us will have them in their pockets. Remember that the next time you complain about how long it's taking for Netflix to load
But - back to the lab - the most interesting thing from that presentation is the little lie we always get in these things. Apple's Tim Millet says "our goal is to build chips..." before going on about the A14's amazing 5nm structure. But here's the thing: Apple didn't build it
Apple doesn't make any chips. It designs them, yes, and it's doing more and more of that. But it doesn't MAKE the chips. That job - perhaps the trickiest job in computing - is done by a company most people outside tech have never heard of: Taiwan Semiconductor Manufacturing Corp
The story of TSMC and how it was associated with a revolution in computing, is one of the most fascinating tales in modern economics, because in a way it's a continuation of a principle which goes all the way back to this fellow, Adam Smith
One of the key principles in The Wealth of Nations (1776) was division of labour. Focus on one thing & collaborate & everyone wins. His famous analogy was a pin factory where people worked on different stages making a pin. Far, far more efficient than one person doing everything.
Back in the early days of computing most processor companies were a bit like the single person making a pin. They designed the chip but also wrote the architecture library to control it and had their own factories which made them. Intel still works in that integrated way today.
But over the past couple of decades the whole ecosystem has fragmented. Now many chip companies design their chips but then get someone else to do the other bits like the architecture and the manufacturing. Division of labour writ large!
So Apple relies on Arm for the architecture on its chips and relies on TSMC to make them. Or take Nvidia. It's one of the world's biggest processor companies but it doesn't make any of its chips either! It also relies on Arm for some libraries and gets TSMC to make its chips
Were it not for all this, we might never have gotten to 5nm chips. Intel, which plugs on with the old-fashioned model, is still plugging away at 7nm and won't be down at 5nm for years. By quietly making chips for everyone else TSMC got more biz & invested more in fabrication
In short, the structure of this ecosystem is crucial. That brings us back to two of those companies: Nvidia & Arm. Nvidia wants to buy Arm. Here in the UK there's been some hand-wringing about this since Arm was UK born so is an important employer here. But the stakes are higher
Because if Nvidia succeeds it would represent a seismic change in the direction of travel in the computer processor business. Integration rather than fragmentation and specialisation. One of the anonymous companies which has been the bedrock for these leaps 👆would be gobbled up
Arm is involved in the design & architecture of the vast majority of chips produced these days - in much the same way as TSMC is responsible for building so many of them. They are part of the foundations on which 21st century technological progress is built. Something to ponder.
Apple may be the tip of the tech iceberg, it's worth occasionally thinking about the bit under the water. Lots more on all of this 👆in my @thetimes column today: thetimes.co.uk/article/6a0ef4…

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More from @EdConwaySky

Mar 18
NEW
Britain's motoring lobby group the @SMMT has insisted that an unprecedented 2,000% increase in car exports to Azerbaijan has NOTHING to with Russia and is explained by the fact that this former Soviet state is a “flourishing market in its own right”.
This is rather... odd
🧵 Image
Before we get onto that, some background (thread on this here👇).
TLDR: UK car exports to Russia have collapsed, because of sanctions. But UK car exports to countries neighbouring Russia have suddenly risen by nearly the same amount. Esp Azerbaijan
Following my original report we now have new figs on UK car exports.
They show flows to Azerbaijan have continued. £42m in Jan. 3rd highest EVER.
Now there's no way of being 100% sure what's going on here. you can't track consignments beyond Azerbaijan (if they ever reach Az) Image
Read 13 tweets
Mar 12
🚨The strange tale of British luxury cars & Russian sanctions🚨
🧵A thread on some v striking charts which raise some disturbing questions abt the car industry.
Let's start at the start.
Wealthy Russians love high-end British cars.
Don't just take it from me. Take it from her 👇
So when Russia invaded Ukraine, it was not without significance that all Britain's major carmakers said they would stop sending their cars to Russia.
Anyway, shortly afterwards, the UK imposed sanctions which made it illegal to do so anyway...
There are two sanctions of note here.
First, UK companies cannot send "dual use" items to Russia which could be turned into weapons.
Second, there was a specific ban on the sale of any car over £42k👇
So it's pretty simple. No cars. Esp not luxury cars. legislation.gov.uk/uksi/2022/452/…
Image
Read 15 tweets
Mar 6
💷BUDGET THREAD💷
A few thoughts on what was supposed to be a big event but ended up feeling, well, a wee bit thin.
And that’s the first thing to say.
Strikingly, this Budget was HALF as big as the Autumn Statement. Look at the difference between the scorecard totals 👇
Image
Image
Was it a tax-cutting Budget?
I mean… not really.
Well, OK, the net impact is taxes aren’t going up as quickly as they were 6 months ago.
But (and I think this is pretty crucial) THEY’RE STILL GOING UP. The tax burden will be higher at the end of this Parliament than before.
Here’s a good illustration of that.
The bars here show you the impact, across the economy, of the decision a few Budgets ago to freeze tax allowances. The bars are in negative territory.
People are paying more in taxes as they get dragged into higher thresholds… Image
Read 14 tweets
Feb 23
🧵Here's a thread about an obscure economic theory from a century and a half ago, which is about to become a MASSIVE deal.
⚡️It helps explains why tackling climate change is going to be v v hard. Some say impossible.
The story begins with this building👇
Yes it's the @SphereVegas.
Not just a massive entertainment venue but also the world's biggest screen. By all accounts it's an amazing spectacle both outside and in, where there's also a ginormous wraparound LED screen (also one of the biggest anywhere)
Get up close to that enormous exterior screen & it looks v different.
You see an array of little glowing pucks, each one decked with 48 light emitting diodes (LEDs). These act as the "pixels" of the image you see from miles around. These things are magic businessinsider.com/what-the-las-v…
Image
Read 32 tweets
Feb 21
🚨How British companies are bolstering Vladimir Putin’s war machine🚨
A depressing thread.
But an important one.
With some pretty shocking charts.
Let’s begin with the “official” picture. It suggests UK trade with Russia has collapsed since Feb 2022. Down by 74%… Image
Now let's fill in the data.
Look how we're no longer exporting cars or heavy machinery to Russia. Because the govt is well aware this stuff could be repurposed into weapons. So the official line is that this is a big success story.
Looks like Russia's economy is being starved Image
But clearly the Russian economy isn't doing as badly as all that. Indeed Russia is due to grow faster than any G7 nation this year 👇
And that's just the economy. Now look at the battlefield and Russia is looking v strong. No shortage of weapons/drones etc despite sanctions
Why? Image
Read 17 tweets
Jan 20
With Tata steel having just confirmed the closure of the two blast furnaces at Port Talbot, here are a few important datapoints.
First, UK steelmaking has collapsed faster, over the past half century, than ANY other country in the world save for Venezuela.
Pretty shocking👇 Image
The Tata plan is to replace the two blast furnaces with two electric arc furnaces.
There are some strong arguments - not all of which come back to net zero.
One is that Britain produces more than enough scrap steel to satisfy its needs. At the moment this is mostly exported Image
Electric arc furnaces exist to RECYCLE steel via a massive electric current.
UK has long been an outlier in having v few of them. Look: less, proportionally, than nearly any other country in the world.
Essentially we stuck with blast furnaces far longer than most other nations... Image
Read 10 tweets

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