As technology is the biggest staple of human existence, battle over software becomes most likely. It would not be a war in the conventional, but would be dictated by restrictions, tariffs, outright ban and what not. It becomes a tool to crush your competitors and helps maintain or create a unique dominating position for days and years to come. For whatever the commercial indicates might dictate, the policy and order of the diktat has the power of law, any commercial entity might as well not play with it. What we are challenging today is the interdependent technology world order.
Geopolitics is having the better of it, being manifested in a variety of ways; curtailing tech innovation and trade being predominant. So, the latest emanates from a tech truism, No EDA, No Chips. This sums up the criticality of EDA. Electronic design automation (EDA) software is a critical tool for designing advanced computer chips. Semiconductor has been in the news for quite some time now and currently the semiconductor world is facing a new wave of growing technological rivalry. The US has fired a tech salvo against China; by imposing fresh export restrictions targeting electronic design (EDA) software.
EDA software is the backbone of chip design. It helps engineers create, simulate, and optimise integrated circuits that power everything, smartphones to AI systems. Without EDA software, companies cannot design advanced manufacturing nodes like 3 nanometers or below. This move directly threatens Chinese tech giants like Xiaomi and Lenovo, who rely heavily on these US origin software tools to develop cutting edge chips made in Taiwan. What can it do in the long run? It could slow China’s drive for technological self-reliance and reshape the global supply chain.
The EDA companies will be forced to halt providing software updates and technical support to Chinese firms. The hardest hit ones Xiaomi, Lenovo and Bitmain have been developing their own proprietary chips, but rely on TMSC to produce them, which uses US origin software, making it a double-edged sword. Xiaomi’s tech wonder XRING O1 chip is designed with the help of US EDA tools and manufactured by TSMC.China anticipated these hurdles and has invested heavily in domestic EDA software firms. While Chinese tools are improving, they are still less mature than US counterparts, especially for cutting edge nodes like 3nm and 5 nm. This is the clincher.
USE OF EDA SOFTWARE CAN BE THE DIFFERENTIATOR BETWEEN THE WINNER AND THE LOSER.
Sanjay Sahay
Have a nice evening.