ComputInsights #2 – Weekly Computing Market Insights

Market Insights

China’s GaN Breakthrough Could Widen Semiconductor Price Gap with US

Researchers in China have identified the main cause of defects in gallium nitride (GaN) semiconductors, a key material for advanced chips used in aerospace and electronic warfare. By controlling dislocation defects at the atomic level, they developed a new method to improve GaN performance while lowering costs. This breakthrough could further expand China’s price advantage over the US in semiconductor technology amid ongoing trade restrictions.

PC Prices in the US Rise Amid Semiconductor Tariff Pressures

Major PC brands are increasing prices on US-bound products as semiconductor tariffs create cost pressures across the supply chain. Chipmakers and component suppliers face mounting financial strain as customers push for cost-sharing measures to offset tariff-related expenses. With shifting supply chains and stricter US trade policies, semiconductor firms remain cautious about economic instability and profit margins in 2025.

DRAM and NAND Prices Set to Rise in Q2 2025 Amid AI Boom and Supply Constraints

DRAM and NAND flash prices are projected to increase starting in Q2 2025, driven by AI server demand and inventory stabilization. DDR4 and DDR3 production is expected to end by late 2025, shifting focus to newer memory technologies. Micron and other manufacturers anticipate DRAM price hikes, while NAND prices will stabilize before rising. The AI boom, led by Nvidia, Apple, and Google, is fueling HBM3E adoption, further impacting DRAM supply. Additional factors like tariffs and supply chain disruptions could make tech products more expensive for consumers in 2025.

Company-specific News

STMicro and AWS Partner on AI-Optimized Photonic Chip for Data Centers

STMicroelectronics and AWS are co-developing the PIC100 photonic chip, designed to deliver 800Gbps and 1.6Tbps optical interconnect speeds for AI and HPC workloads. Manufactured at STM’s Crolles, France fab, the chip integrates silicon photonics and BiCMOS technology for high-speed, low-power optical computing. AWS plans to incorporate PIC100 into its cloud infrastructure, with production set for 2025.

Alibaba Reports 8% Revenue Growth in 4Q24, Expands AI and Cloud Investments

Alibaba saw an 8% YoY revenue increase in Q4 2024, reaching CNY280.2B (US$38.6B), driven by e-commerce and cloud growth. AI-related revenues surged for the sixth consecutive quarter. CEO Eddie Wu emphasized AI and cloud as key strategic areas, pledging record investments over the next three years. Despite AI’s uncertain profit model, Alibaba’s strong performance in e-commerce and cloud computing has boosted market confidence.

Apple’s C1 Chip Signals Autonomy Shift, Challenges Qualcomm’s Market Position

Apple’s C1 modem debuts in the iPhone 16e, marking a major step toward chip independence. Integrated with the A18 processor, the C1 enhances power efficiency but lacks mmWave 5G support, keeping Qualcomm modems in higher-end models. Apple’s long-term strategy includes reducing Qualcomm dependence, with C1 adoption expected to rise in 2025. Analysts predict Apple could fully phase out Qualcomm chips within two years, reshaping the modem market.

Samsung’s LPW DRAM Set for 2028: A Game-Changer for On-Device AI

Samsung plans to launch LPW DRAM in 2028, enhancing on-device AI with faster speeds and improved power efficiency, outperforming LPDDR5X by 166%. Meanwhile, the HBM market is expanding, with stack layers expected to reach 20, boosting bandwidth for AI workloads and fueling semiconductor growth. As AI-driven demand surges, memory prices are set to recover, and the foundry sector continues its long-term expansion despite fierce competition.

AI

Japan May Ease Privacy Laws to Boost AI Growth

Japan’s Personal Information Protection Commission is considering removing the prior consent requirement for using sensitive personal data in AI development to support industry growth. The commission argues that AI learning data poses minimal privacy risks, while businesses find it impractical to filter sensitive data manually. A proposed bill may amend the law and introduce fines for violations, but its approval remains uncertain.