EU has the tech. ASML is #2 company in EURO STOXX 50 index with 5.69% weight.
ASML is the world's largest photolithography systems manufacturer and the only one producing extreme ultraviolet lithography machines. These EUV scanners are expensive as hell. Last years model costs $120 million per piece and you need 10-15 of them for TSMC gigafactory.
TWINSCAN NXE:3400C (7 and 5 nm nodes, >170 wafers per hour) is probably the most expensive machine in the world.
If the EU treats this as a strategic capability and not commercial, the spending is much less of a consideration.
The advantage that the EU has is in fact ASML. No company can make the 5nm litho systems today, and catching up with the decades of R&D they've invested is not feasible. They are the greatest achievement of science and technology on the planet. [0]
The strategy that can work is for the EU to partner with TSMC to build a foundry in the EU that produces at the node they want to intercept (2 nm?). Then, make a business arrangement that puts European scientists and engineers into high-value roles. That would enable the EU to develop the technical skills and keep China from locking it up.
Man, I wish I too shared such optimism in EU or other massive multi government bureaucratic organizations to pull something off like this in 2021. But sorry I simply don’t.
From my experience with gov trying to do tech investment it’s going to go into the pockets of late career overpaid ‘executives’ with ‘industry experience’ and tons of (also overpaid and underqualified) contractors doing the same thing. Not the brilliant engineers you imagine are going to run it.
I mean I hope it goes to the engineers and smart dudes (who doesn’t want another successful semi competitor and 2nm?) and not the ones who know how to play the political game the best but I’m highly highly skeptical.
We’ll see in a few years I guess.
And I say that fully understanding ASML and the value they currently provide. But let’s hope who ever doles this out understands it as well as (maybe) half the people in this thread.
But even ignoring that giant elephant in the room, it adds the critical question why should ASML care to give special treatment to this one project? They are already killing it globally. Just because they operate in EU and this offers shit loads of money to potentially fleece?
> Not the brilliant engineers you imagine are going to run it.
I have no doubts brilliant European engineers are going to work on the hard problems of shipping a next gen chip process and design... In America!
What the EU should do is earmark some of that money to be directly paid as engineering salaries. Of course they won't: that would reduce the piece of the pie of all the non-technical managers and bureaucrats!
> What the EU should do is earmark some of that money to be directly paid as engineering salaries.
I mean, that's exactly what they do. Any company with good finances can apply for support for R&D to develop new features or tech that they would otherwise not develop or invest in. This comes in the form of direct contributions to employees' salaries listed in the grant application.
I've written and defended these grants for multiple companies and I have been on the receiving end of them, too.
This isn't even specific to this deal, this is just something you can always do, along with literally hundreds of EU and state level support programs.
That's an understandable reaction if you just look at the raw USD value, but that's very far from the full picture. They are not pitiful when you start adding the costs for housing, healthcare, transportation and the rest of the things that you need to live. Compared to the huge wage increase, the increase in living standard is very minor (and in some regards worse, e.g. the amount of time you lose daily to the car centric infrastructure).
The number and quality of available jobs in the SV region was a much bigger factor to everyone I've spoken to that moved from the EU.
They still are pretty pitiful across Europe even after that, compared to Canada and Australia as well as the US.
In the UK the problem seems to be the company owner/manager class see software people roughly the same as any other office worker, rather than as skilled producers of products. As a result they pay peanuts, and then are surprised when they get less than stellar results. Not sure what the reason might be elsewhere, but across the rest of the continent the pay seems even worse.
>That's an understandable reaction if you just look at the raw USD value, but that's very far from the full picture. They are not pitiful when you start adding the costs for housing, healthcare, transportation and the rest of the things that you need to live.
And that’s not even specific to tech salaries. A typical Bay Area TC of $250-400k for a senior engineer will also include great healthcare so there is basically no competition in any European location.
You have to specifically want to live in a European city for the culture/walkability/etc or else there is just no reason to take tech jobs there.
> A typical Bay Area TC of $250-400k for a senior engineer will also include great healthcare
Notionally, yes, but in reality it will be the same blighted hellscape of insurance denials, out-of-network complexity, and lack of consistency as everyone else's healthcare in America. You can hire someone to help you navigate it, which is a remarkable economic construct.
You have actually addressed the actual issue here but from wrong perspective.
Culture is the issue here. EU tries to live, USA tries to earn. If the only thing that interests you is money then yes, probably USA is the right direction. Of all the people that I know that went working outside of their country, they were mostly going to EU companies (or USA companies in Europe), sometimes to the Asia. None left for USA. On the other side I know a CTO that left USA for Europe and bought a small property in France where he lives with whole family.
This shows very well in environmental laws, gdpr, protection of workers, actually having friends, nature, having hill-climbing organizations that aren't only lobist groups to be actually allowed to climb the mountains, public transport, able to drink spring water in center of capital city, most people working 40h/week max, actually do use their vacations in one piece, free education, maternity leave measured in years not months (yes under a year too but not month or two),...
So it depends on the personal cultural preference. Some people just love the money and things they can buy with it, maybe even power that it brings and surely a lot of such people are also in EU. The difference is in the percentage of population although Hollywood did great job at exporting the view of world trough money glasses.
---
Regarding the topic. EU was quite satisfied with buying processors from the States, it was also happy with using Windows, Android, Apple thing. The problem is, as in every other thing, USA corporations became vampires that wants to eat you alive from pure greed and systemic addiction to blood (endless growth).
It has become imperative to produce our own processors as you can no longer trust USA or China to not shovel inside some spying equipment. Well the times have changed and it is no longer an option to buy it from USA/China, so EU has moved forward and dont worry, we will have our own chips our own phones and operating system (linux, sailfish or something else...).
EU is an elephant and it needs a lot of coordination of muscles to move its legs but once it starts moving...
I am sorry, I would love to just use the USA/China products and not re-develop hardware (based on what we know now, maybe not dragging 40 years old anchor of previous development with me), not having a need for GDPR, but they have both just screwed everything up from pure greed. Now we need to fix it and a lot of time and resources will have to go that way. But we will eventually fix it.
>Of all the people that I know that went working outside of their country, they were mostly going to EU companies (or USA companies in Europe), sometimes to the Asia. None left for USA. On the other side I know a CTO that left USA for Europe and bought a small property in France where he lives with whole family.
Meanwhile (since 2012) Trump happened, race unrest's, police brutality, corona handling fiasco, Google/FB/Amazon public image is going down, USA public depth has roughly doubled [1] and general perception of USA has changed (to the worse[2]), China is hiring, student depth is going trough the roof (and immigrants want to have children someday), no one believes in "war on terror" any more (talking about EU), Snowden, war on privacy,...
This graph is outdated, did you find some that is up to date? Also interesting one would be how many of those in 2012 survey stayed and where.
I see that you deleted your further attempt to mock my presenting statistics in exchange for your anecdotes (I had no idea until reading your contributions here that that in the US there is no "actually having friends, nature, having hill-climbing organizations that aren't only lobist groups to be actually allowed to climb the mountains").
But since you did bring up Germany with the deleted mention of Operation Paperclip, I suggest you read https://news.ycombinator.com/item?id=25367731 , in which @bildung and I discuss German migration to the US over the past 30 years (including 2019 data).
>This graph is outdated, did you find some that is up to date?
I provided statistics in response to your anecdotes. The onus is on you, not me, to prove that a) your anecdotes are actually representative of broader trends, and b) my statistics are, in fact, outdated.
You can get the walkability side in any of northeastern cities such as NYC, Boston, and to a lesser extent D.C. Pay is comparable to the Bay given the cost of living difference.
Comparable is generally not true - the difference is maybe ~$30k at best in DC vs. the Bay Area for example, but DC compensation is nowhere near what you can get in the Bay Area. The only thing in the US that beats it it seems is NYC area finance (i.e. hedge funds).
There's a catch, though: You have to live in the borderline failed state that is the USA. That's quite the drawback and just not worth it no matter the salary increase, imo.
"Disposable income per capita" is certainly a number, but it's not actually meaningful in this context for a few reasons:
1. "Disposable income per capita" is irrelevant to normal people, as it does not account for how equally that wealth is actually spread. If the top 1% double their income and the rest halves it, that's still a net increase in "disposable income".
2. "Disposable income" does not at all account for the varying amount of cost required to sustain a given standard of living in different regions, even within a country.
3. "Disposable income" is a purely economic measure. As such, it does not measure a large amount things that impact your quality of life, like time off, stress, job satisfaction, etc. A quick look at those non-economic measures will show those high economic measures don't come for free.
Honestly, I looked into this for myself a few years ago. I always hear this health care, holidays cost of living argument. It just doesn't add up. Europe's salaries are just too low.
Global purchase power is a very limited and 100% american way to assess work compensation. In europe we don't care only about the number but about many other factors.
Yet tech salaries in Vancouver combined with real estate values make it so that most tech jobs are barely living wage, at least when my partner and I tried hard to make it work some years ago. Even with universal health care (which wasn't quite what they have) it couldn't possibly make up the difference for someone with college debt.
I'd argue that if you got a CS degree from an American college you're probably just forced to work in the US simply because the other prospective employees can accept a lower salary due to a lower debt load. Maybe the best of the best can find a way to earn American salaries overseas but I really don't think that's as common as the HN crowd might assume.
The situation in Vancouver is caused by out of control immigration quotas. Real estate there is a way to park assets in a safe jurisdiction.
Seattle has a much healthier market both for devs and real estate and is only three hours away.
Only difference in healthcare is while american top devs get it on top of their compensation packages, canadians pay for it with their prohibitive income tax rates. It's pretty easy to take the total spending percentage that goes to healthcare and multiply it by your income tax to see how much a dev is really paying for healthcare.
I don't think Vancouver is as bad as you make it out to be. No, you will not make the same money here as in Seattle, it's often something like a 1/3rd pay cut. That is not a bad income however, it is easily enough to rent and whilst real estate in Vancouver proper may be expensive there is reliable transit and property in the other cities such as Burnaby, Richmond, Coquitlam etc is significantly less expensive.
I'm also not quite sure what you mean with your point about healthcare. MSP premiums were eliminated last year [0], there is now no charge to access medical care. Prescriptions, dental and eye care are all still chargeable, though prescriptions at least are essentially capped through BC Fair Pharmacare [1].
Compared to the US, Canada is much easier for immigration as a tech worker. One can get PR (equivalent of a green card) before landing if they have a sufficient points score, in BC that's fairly easy through the tech PNP [2] and a willing employer.
Additionally Vancouver consistently ranks among the top 10 most liveable cities [3].
>What the EU should do is earmark some of that money to be directly paid as engineering salaries. Of course they won't: that would reduce the piece of the pie of all the non-technical managers and bureaucrats!
This is what China's doing: offering double salaries to Japanese and Taiwanese engineers to lure them away, because tech salaries in Japan and Taiwan are quite low by global standards (even lower than China's).
If someone tried doing that in Poland:
- there would be a huge (and proper imho) outrage - why not teachers, or nurses
- every job would be registered as a programming job ;)
this would be the case in most european countries mainly because of the difference in culture in regards to working and the role of making money in society.
It is not necessarily a bad thing either in my opinion.
A lot of americans seem so focussed on making money, instead of caring for others around them.
> Man, I wish I too shared such optimism in EU or other massive multi government bureaucratic organizations to pull something off like this in 2021. But sorry I simply don’t.
I can understand your concerns. But if you look at mid-range airplanes the European monster Airbus did respectably catch up with incumbent Boeing.
In with the Jumbos they clearly surpassed it engineering-wise but failed in their commercial predictions that such planes would be needed.
So EU is neither a guarantee for failure nor for success.
Plus side, the amount of money seems realistic. TSMC's latest node at 5nm/3nm was like $16B and so 10x doesn't sound outrageous if playing catchup.
I do wonder how many people will be involved; it could be like ITER where everyone builds one fab that's truly the best in the world. Or it could be that they want to spread it out amongst the existing incumbents they can find who I am sure will do nothing with it.
Concentrate the funding and I imagine it could do pretty well. Distribute to (more than one) commercial entity (preferably zero to retain public access) and I doubt it will go anywhere.
Airbus was not related to EU (or EEC). It was basically a France-Germany bipartite cooperation, with tiny bits of Spain and Netherlands, and UK being in/out. UK didn't belong to EEC when they were supposed to take part in the beginning of the project. Spain didn't join EEC until 20 years later. Netherlands were in by accident, in a way.
While Airbus is older than the current EU it was and is a multi-national cooperation in the same spirit, where political and national interests need to be taken into account, even if it reduces economic efficiency. They even needed the Beluga https://en.m.wikipedia.org/wiki/Airbus_Beluga because they could not concentrate manufacturing of big parts in a single country.
Boeing should have a clear advantage because they have no such political interference. But it doesn't seem to have prevented Airbus from being a serious competitor. Whether the political interference is older than the EU or from the EU of today should not make a significant difference here.
I think I share your concern -- it's a question of "is a top down order to develop some technology (with required investment to 'force' it to happen) the best way to achieve that?"
What often ends up happening is that because it's so "strategically important" and so much money has been directed towards it, you are obligated to have expensive ("experienced") people hired based on past reputation -- which may not be applicable to new technology, roadmaps get laid out which everyone has to say they're meeting successfully, and then at the end you find out somehow that it didn't produce what you wanted.
Versus, a more bottoms-up approach where you hopefully create the conditions that incentivize or make possible some technologies and technologists to succeed -- without knowing fully who exactly or what exactly.
I'm sure that both have some inefficiencies, but the 1st method is sure to pay the people who have already been successful. But then again, maybe for a relatively incremental advance in some technology, there are fewer unknowns and method #1 works ok.
Conversely, for the really novel stuff government investment in research has a pretty good track record, really - I mean, they don't always turn it into a product, but who cares? Hoping for a corporation to fund medium or long-horizon research seems unwise. Even if they do, they're not going to do it in a way that's very efficient (i.e. they'll inefficiently invest in stuff with a high moat, rather than broad applicability).
As far as I understand, ASML is not the creation of government
funding, but instead a spinout of Philip and ASMI, two successful
Dutch electronics companies. ASML was successful in a competitive market, dominated by Japanese companies pretty quickly.
In other words, very different model from what the EU is currently trying.
However TSMC is a direct creation of the Taiwanese government.
In 1985 Morris Chang was recruited by
the Taiwanese government to help develop
the emerging semiconductor industry. In
1986 Morris joined the Hsinchu based non
profit research institute ITRI as Chairman
and President and launched what would be
TSMC’s first semiconductor wafer
fabrication plant on the ITRI campus.
Taiwan Semiconductor Manufacturing Company
Ltd. was officially formed in 1987 as a
joint venture between the Taiwan government
(21%), Dutch multinational electronics
giant Philips (28%), and other private investors.
You are correct. The discussion about ASML is relevant in that state of the art chips cannot be produced without one of their TwinScan lithography tools. ASML is the only company that can build tools with 7nm and below capability.
In the context of the EU developing the ability to fabricate state-of-the-art chips, ASML would sell them the TwinScan tools they needed, which are just one species of about 40 that are used for chip fabrication.
ASML would also sell those tools without prodding by the EU. ASML would dearly love to sell them to SMIC and other Chinese foundry too, if the US would let them.
Lithography machines are a functioning market that is interfered with for geo-strategic reasons.
If ASML is the only company that can do what they do and anyone else would need decades to catch up, how are they not the most profitable company in the world?
All of the world's most profitable companies depend dearly on chips. If they are literally the only company that can provide this critical part of the chip production, why aren't they taking a larger portion of the profit?
At some point their customers will stop worrying about using 7nm and go back to double-digit nanometres. CPU tech from the 2000s is adequate for most workloads, let alone stuff from 2010.
I'm sure there is a lot of stuff where 7nm is necessary to get certain outcomes, but it is a small market compared to what could be reasonably done with older process technologies.
ASML is not directly funded by a govermental grant yes, but phillips had massive govermental support (mainly from the dutch goverment and the EEC aswell).
I don't think this requires anything special from ASML. They'd sell systems to the TSMC/EU partnership. The key is that the process engineers in the fab would learn how to develop processes for the leading edge geometries. To some extent, ASML engineers would know this, too. However, the secret recipes (literally) of chip production are so closely guarded that even the equipment companies for the tools they run on are not permitted to see them.
I completely agree that consortium-based organizations are less able to respond and react to changes or issues. That's why it needs to be treated as a strategic (defense) matter rather than a government/industry partnership, a-la Sematech in the US.
> Not the brilliant engineers you imagine are going to run it.
I'm still so fascinated by our minds' ability to interpolate and extrapolate to the platonic ideal of any ungrounded and unconstrained idea so readily. Yes big bureaucratic mass of brain trust experts going at it nonstop, how can you not yield great returns? I'm starting to awaken more and more to how messy and data dependent this world is. Ideals and declaration and promises just don't go far enough. But it's all so complicated and situational to figure out in advance why they don't go as far as we'd expect.
A relative is a middle manager in one of the biggest tech organizations in EU; only 60% of their huge organization is doing actual work and that 60% includes the management of the actual experts; the rest are "support functions" with very well paid positions for people appointed by the member states with strong political connections and no relevant skills vs. hired with interviews for the 60%. But even in the 60% there are a lot that are not meeting the skills required, but they are protected from any action by labor laws and unions, including forced salary raised based on how long they worked there, with no performance indicators.
In practical terms, over 50% of that large (many thousands) organization should not exist. Another 50% of what is left is only needed because EU bureaucracy requires them to cover work that can be avoided. That qualifies for "too much bureaucracy".
> This book contains three basic ideas. The first is an output-oriented approach to management. That is to say, we apply some of the principles and the discipline of the most output-oriented of endeavors—manufacturing—to other forms of business enterprise, including most emphatically the work of managers. Consider Intel, which is a true manufacturing and production company, making highly complex silicon chips as well as computer-like products built from them. Our company now has over thirty thousand employees. Of these, about 25 percent actually work to make the products. Another 25 percent help them as they supervise the personnel, maintain the machines, and engineer and improve the manufacturing process. Another 25 percent work in administration, where they schedule production, keep personnel records, send bills to our customers, and pay our suppliers. Finally, the remaining 25 percent design new products, take them to the marketplace, sell them, and service them after the sale.
Andy Grove, High Output Management, about Intel (at the time when they were successful)
I think there are many, many (not directly) productive functions that successful business needs to have and engineers often underestimate those (I certainly know I often do).
What is described above is a close to 100% productive personnel, direct or indirect. Imagine on top of that you have 10% that "work" on wellness programs (on paper, no tangible output ever, maybe a link to a Youtube yoga channel), 25% doing marketing for an institution that is unique with no competitors and no need for publicity (imagine publishing adds for Europol, the European police force; what are they selling?), another 10% doing diversity programs (when skilled engineers are already scarce, you force quotas on various categories) and another 10% are hired just on paper and never appear to work.
>From my experience with gov trying to do tech investment it’s going to go into the pockets of late career overpaid ‘executives’ with ‘industry experience’ and tons of (also overpaid and underqualified) contractors doing the same thing. Not the brilliant engineers you imagine are going to run it.
Are we talking about VC and large corporate investment or government investment here.
Pretty much. All big players (US, EU, China) must maintain domestic strategically important industries (aerospace, energy, semiconductors, telecom, drugs/biotech ...) even with government subsidies.
The goal of strategic investment is to stay as one of the major players in the industry. Being the leader is not necessary, but letting the deep core and knowledge in manufacturing to erode is strategic weakness.
Exactly the opposite happened in Russia and other ex-soviet countries. The factories were sold and dismantled under the pretense of “transitioning to market economy”.
That’s exactly the narrative that was used. I guess that’s why Yeltsin was such a good friend to the west and why he’s despised by many Russians.
I mean, sure, many factories were not competitive since they were highly subsidized and faced no competition on internal market. But USSR had an immense R&D potential and engineering education was top-notch.
Price signals following the soviet collapse were non functioning ( see the current oligarchs ). It’s hard to know how many of these factories could have adapted over a slightly longer time frame or with some slight investment restructuring.
When the price of a corporation falls below their paper assets it tends to attract A certain kind of investor disinterested in long term value. I’d venture a good number of soviet parts suppliers saw their revenues dry up when their clients were dismantled, it wouldn’t have taken more than a few such links in the supply chain being dismantled to break the entire supply chain given the level of centralization.
No. There’s significant evidence that sudden overnight market manipulation (e.g. setting exchange parity to the eastern and western Deutsche Mark destroyed all eastern consumer goods industries, which were bought for symbolic sums and then deliberately shuttered.) it’s obvious that any such fundamentalist and radically liberalist policy would have tore through any economy, but the point was to smother Carthage, and sow salt on its ruins
this graph does not take into the account the massive geopolitical difference between ukraine and poland, especially considering poland had far more possibilities in regards to joining and integrating with western european economies compared to ukraine.
Don't forget that prior the collapse of the USSR, ukraine was not an independant country from russia, while poland has always been "independant" during socialist times.
This is not true, several precision mechanics factories (or parts of factories) in Hungary were producing for Western export and yet they let them rot apart.
Same happened in Latvia where the largest soviet chip maker ALFA was dismatled under silly (but efficient) propaganda premises. It was top notch and had great contracts with US and Russia at the moment. Decades later the retired goverment officials confirmed they were "advised" and said "we did not understand what we were doing very much back then". Of course, they were ex-soviet middle level officials and anti soviet activists who suddenly found themselves in power and needed such advices.
The true reason for those who wonder was the fact that ALFA was making electronics for MiG, Su, Tu and for missiles. I had family and friends working there btw.
Indeed. In my hometown - Gyula, Hungary - there was a precision mechanics factory, for phones, faxes, communication relays called Integra. It wasn't huge, employed a couple of hundreds people. In '89, Olivetti bought it for peanuts to close it down.
This was quite a classic move during the "privatisation" in '89-90.
Some fertiliser plants (Achema for example) still rely on exclusively signed contracts with Russia for buying cheap natural gas (its main cost) aka there’s some underwater influence there.
Most of the time with countries not directly aligned to the west, the preaching is for us to sell our strategic industries in name of liberalism and "economic openness", usually spreading lies and misinformation about the company's efficiency. When it's the other way around, it's protectionism and good old Keynesian economics: China can't buy that company, their 5g is evil etc.
I know this first-hand because it has happened to my country each and every time an US backed president was elect. It's happening right now, they're attempting to sell our only semiconductor company.
The Soviet Union was destroyed from within much the same way the 2010s arab springs/ukraine and more recently also tried with HK.
There is a popular myth that 'there was a mighty USSR and some enemies ruined it'.
The Soviet Union collapsed because of massively broken economy. That's just basic science. They exported oil and imported grain. Russia imported GRAIN for gods sake. Then oil prices collapsed. Next? They did nothing and just ate through the resources until they were no more.
And then 'evil liberals/evil west destroying the great country' happened, when finally USSR had no money to pay for the social obligations and for massive military.
This are the undisputed facts, supported by a vast trove of internal documents from the late USSR and first years of the Russian Federations.
A monograph by Egor Gaidar [1] is an excellent source referencing tons of the original documents.
Sorry for Russian, not sure this is available in English anywhere.
I get that it's easier to think that source of our problems is some evil mastermind and conspiracy. But think of the Occam's razor — this is explained much easier by sheer incompetency and stupidity and no checks and balances to mitigate them.
The truth is in between. Was USSR full of internal problems? Yes. Did USA and allies want USSR destroyed and actively work on? Also yes. Saying that Cold War and the arms race had absolutely no role in USSR collapse is either a blatant lie or incompetence.
Exactly. Had the west not interfered, the USSR would recover from the 80s crisis. Instead, they took advantage of its shortcomings and managed to break up the union: Gorbachev is considered by many Russians a traitor, but he was not the only western investment in toppling the Soviet Union.
Let's remind that full-on opening of the market was not what the west promised, but it's what they pushed for once the reforms passed a point of no return and they wouldn't take "no" for an answer. Propaganda is what won the cold war.
I think you miss a crucial fact here - large part of Soviet block was incorporated by force and wanted to get rid of their influence as fast as possible. Nobody misses USRR here in Poland.
Poland is a weird example since it doesn’t seem like they fit in the EU either, almost like an outcast.
But let’s look at other ex-Soviet countries. Territorial quarrels and dumb nationalism were unthinkable back then. Look at Azerbaijani and Armenians, ethnic Ukrainians and Russians in Ukraine, Georgia...
If only we ("other ex-Soviet countries") could stop our "dumb nationalism" and go back to being nice "little-brother nations", speaking Russian, fighting Western imperialism together somewhere in Afghanistan after being drafted to glorious Red army... Those where the times, comrade!
Or you can compare countries from a similar regions that decided to stick close to Russia (Ukraine and Belarus) vs countries that decided to stick with the West (Poland, Estonia, Lithuania, Latvia).
> Also yes. Saying that Cold War and the arms race had absolutely no role in USSR collapse is either a blatant lie or incompetence.
USSR could've easily continued its existence if it went full "North Korean." Union's army had no problem to force populace to eat grass in case of a complete economic collapse.
I attribute the single most important contribution to Union's collapse to US funding exchange visits for hundreds of USSR's senior officials, and completely nullifying their will to struggle: https://news.ycombinator.com/item?id=24728237
The very same thing has happened to China, and Xi is trying hard to undo it.
His message of absolute committment to, and inreversability of "opening up" don't mean anything to 99% of ordinary citizens.
Whom he addresses these messages to are not ordinary Chines, but elites whom he tries to convince to the best of his abilities to not to drop the ball on him, and the system.
> The Soviet Union collapsed because of massively broken economy.
Which was a direct consequence of surreal levels of corruption, incompetence, and double digit percentages of country's GDP coming, and going out of existence annually as a result.
If anybody are to call names, those would've been the most hardcore brezhneviks themselves.
> They did nothing and just ate through the resources until they were no more.
Those resources they ate through -- when were they accumulated? I find it hard to believe that they became a superpower by just coasting on the wealth that existed in 1917.
You seem to forget that oil became an increasingly important resource. And the USSR had a LOT of oil. Look at how Saudi Arabia, the UAE and Norway developed, and then look at the USSR.
> The economic development achieved by the Soviet Union in the first half of its reign was incredible.
That's a regurgitation of a great lie. Krusev indicated in his memoire that economic data of Stalin's years was defying kindergarden level arithmetics, was utter garbage, and he gave few convincing examples of that, and here, I would believe him.
Union's economy saw few ups, and downs during its existence, and those under Stalin, and Breznev were not ups by any extend of imagination.
Up to 40% of the tanks that fought on the Russian side in these battles were supplied by the British. UK provided a huge amount of war material to the USSR that helped keep it in the war.
I do not think that is true. Maybe 40% of the types of tank.
Some facts from Wikipedia: At the opening of operation Barbarosa the Red Army had four to one advantage over the Nazis in tank numbers.
By 1941 lend lease tanks were 6.5% of Soviet tanks, about a quarter of medium and heavy tanks.
Where do you get "up to 40%" from?
Even if true my point still stands.
According t Alex Nove in 1900 there was not a metal lathe in all of Russia. They could de clinker locomotives, but not make a gear box. By 1941 they were out stripping the Germans.
That is the greatest economic achievement of the twentieth century.
(IMO the Bolsheviks were sadistic psychopaths, but credit where credit is due)
> According t Alex Nove in 1900 there was not a metal lathe in all of Russia. They could de clinker locomotives, but not make a gear box. By 1941 they were out stripping the Germans.
Again, you are regurgitating a myth.
I would not doubt the 4 to 1 outgunning of USSR vs. Germany. Indeed Union's army was incomparably materially superior due to decades long total dedication to military buildup, but that does not preclude the fact the industry was still barely going, and that this material advantage melted like butter within first months of war.
The lie is the Soviets were bad economic managers. They pulled off the most incredible feat in industrialising their economy in less than fifty years, more liek twenty five useful years.
The millions of starved peasants, slaughtered "class enemies", exiled dissidents.... They were there too. Not pretty, not moral, not desirable, but incredible achievement nonetheless.
I am not sure, how in the context of such a system "efficiency" can be measured. But in raw capacity there has never been anything like it until the Chinese in the nineties and naughties with their own millions of starved peasants, slaughtered "class enemies", exiled dissidents....
German army mostly found that Union had more soldiers than they had bullets, and that wehrmacht got to Moscow on the fumes.
The "massive industrial advantage" was nothing not to be expected from the most resource rich country on the planet.
Yet, the country was, by all accounts, from both most staunch communist party sources, and contemporary anticommunists, completely incapable of running during the crisis, and "all in" strategy of manufacturing one gun, one tank, one shell, one plane in massive amounts was a result of desperation, not industrial might.
And what was the alternative? The German’s objective was to literally clear the land out for German settlers. By killing everyone inhabiting those lands. For soviets it was a matter of giving at least some chance of survival to women and children they were trying to protect. Imagine all those soldiers who knew they had to sacrifice their lives.
And you try to reduce their bravery to being “Stalin’s targets”.
But never could make consumer goods. When the economy had to pivot to a consumer lead one, they found that all the economists with different ideas had been shot....
Would be interested in links discussing this, if you know good ones (in English!). Who's the anti-Gaidar one should read to see his opponents point of view?
Sadly I don’t know any serious economist who would oppose him. But yes, he was demonized by state run media in the last years and hence is a controversial figure.
> Airbus is absolutely crushing Boeing in terms of quality. Granted, we are woefully behind on the 'space' part of aerospace
Such a hyperbole statement.
Airbus has the edge in the narrowbody aircraft market, especially A321, while Boeing is plagued by 737 MAX problem.
OTOH Airbus is well behind Boeing in the widebody segment. Boeing had 1,464 787 orders as of Aug 2019, 882 of those had been delivered. Airbus had only sold 913 A350. A380 has been discontinued while Boeing can still count on B748 freighter.
Of course 2020 threw a wrench to the airline industry and it remains to be seen how well it will recover post pandemic. Both Airbus and Boeing are affected deeply.
You conveniently forgot the a330 which is Airbus' most successful widebody.
You are right that for now, Boeing is better in widebodies. But let's see Boeing new aircraft program, because currently Airbus is better prepared for the future.
How much of Huawei's research is done in EU? They have at least three research facilities in Sweden alone. Ericsson does a lot of research in the US. All of these companies are global, so to assign their research to only the country where they're headquartered gets a bit nonsensical.
Huawei’s tech is better per $ because they skipped years of R&D that they didn’t have to price in. I remember when their products included Cisco manuals.
> CERN is anchored to the EU. ITER is anchored to the EU.
Anchored, yeah sure. So you're listing something that isn't in the EU, which is revealing. ITER is entirely irrelevant. It's a pork project that won't result in much. The biggest breakthroughs in fusion will derive from smaller projects, not giant slow-moving projects like ITER. The next 20-30 years of energy generation is wind, natural gas, oil, solar, some hydrogen and nuclear (and primarily only China is brave enough to build that). Fusion will make zero contribution in that time.
> BioNtech made the first breakthrough on a COVID vaccine.
Moderna was just as well positioned as BioNtech, you're more than reaching. Russia and China also have apparently successful vaccines being deployed.
> The EU has many issues, but losing leadership in the sectors you mentioned is not one of them.
That's true in the sense that the EU never had leadership in most fields to begin with.
Fusion research needs a lot of money and resources. I honestly doubt it can be done by a startup. Nuclear fission was done by very well funded military research. It is true that China has licensed basically every nuclear design, but France is still a leader in nuclear fission.
I believe that if startups can keep losing billions each year and go public without ever running a profit, then startups may just as well be able to create a fusion power plant.
> Anchored, yeah sure. So you're listing something that isn't in the EU, which is revealing
It is surrounded by EU
countries, in a country that is a pseudo-EU member. You're reaching.
> ITER is entirely irrelevant. It's a pork project that won't result in much.
Unless you have a seer's eye, these kinds of claims are baseless.
> The next 20-30 years of energy generation is wind, natural gas, oil, solar, some hydrogen and nuclear (and primarily only China is brave enough to build that)
Agreed and a sad state of affairs
> Moderna was just as well positioned as BioNtech
Which makes Moderna a leader too? It doesn't diminish BioNtech's work.
> That's true in the sense that the EU never had leadership in most fields to begin with.
You literally had to ignore multiple points in my parent comment to even be able to make this claim. Revealing..
Edit: not to mention we are commenting under an article that partly concerns ASML..
One might wonder if the EU has leadership capacity to be able to maintain domestic strategically important industries.
Generalising from 40 years of EU history, I have little confidence. The top US and East Asian processor and semiconductor companies all are extremely successful in the marketplace, in addition to consuming government subsidies. Fostering a competitive market has not been the EU's forte. Indeed the EU narrates this funding as a need to address a "market failure" [1]. I feel that this is one-dimensional, bur entirely predictable from the structure of EU decision making.
Just today, at midnight, the EU lost ARM and DeepMind as domestic industries.
I know nVidia bought Arm, but what is about DeepMind being lost as domestic industry?
It raises to prominence after becoming a Google wholly owned subdiary. I have repeated multiple times in other comments that DeepMind's success is at least built on top of Google's tech and capital.
Interesringly, Google's tech infrastructure were blueprinted by a lot of pioneers and two of the most well known are Urs Hozle and Luiz André Barroso both are of Eu descentdent.
There is no evidence that whatever DeepMind did can be done with another EU partner. Or even anyone who is not Google, largely thanks to Larry and Sergey's personal tastes and experience. I doubt Msft or Amazon have the right culture for DeepMind.
The whole alphabet thing was engineered to allow independency. So that, among other things, a more pure research org can work without the ever encroaching of the profit driven hands inside Google. Mind you, DeepMind absolutely put itself above Google, or at least firmly distance itself from Google, GCP once proposed to use DeepMind brand in marketing materials, and was sharply rejected citing "conflicting brand images".
Leadership or "leadership"? EU is full of "leaders", those that self-titled as such.
It lacks motivation, there is no SV in Europe because one cannot pay competitively with SV for top talent when you tax to death. It is a lot easier to become a billionaire from real stuff (not manipulating stock markets or other financial trickeries) in US than in EU, so the smart and motivated in EU move to US; what is left is ... what is left: either less motivated or less smart or less both.
The parent is alluding to the notion that govt investment made for sluggish state owned industries which aim to be second and suck the life out of any domestic competition.
There are a variety of ways to cultivate a domestic industry, govt committees directly investing doesn’t seem like the leading candidate can. Trade barriers and state sponsored industrial partnerships.
Underrated comment! If eu has a viable alternative to tsmc, incentive to protect Taiwan diminishes greatly. Then again, Why would the eu care to fight China? EU does not seem interested in using its power to further democracy elsewhere (or even within Europe.... )
We have been trying to help Infineon get onto its own feet for years and years, it just isn't happening. The investment it would take for competing with TSMC would require massive government support with very few benefits. Specialized chips with higher margins but older tech make more sense than mass production with the most advanced process.
Same with solar or battery tech, we have the tech and the people but economically it isn't feasible to have production in the EU.
> No company can make the 5nm litho systems today, and catching up with the decades of R&D they've invested is not feasible. They are the greatest achievement of science and technology on the planet. [0]
Those are some huge claims, which could have previously been said for many currently outdated technologies.
The EU has the tech, but that's not enough. I won't say the whole budget will be wasted away, but I hold no hope of something useful coming out of it.
The EU has ASML, NXP, Infineon, maybe STM (not sure) and a ton of little shops, but all of them are far away from the major players. And they are moderately confortable in their niches. This is a very high risk endeavour, even with EU money.
And as far as I know, none of them manufacture for other end-user players, so even if there was a new fabless company with a cool project, it's likely that wouldn't be made in the EU bu by Samsumg or TSMC.
> .. I won't say the whole budget will be wasted away, but I hold no hope of something useful coming out of it.
The ECB has been buying trillions of euro's worth of dubious government bonds and bank debts for the last couple of years. Also every year the EU pays hundreds of billions worth of subsidies to European farmers so that they are able to sell their goods below global market prices. I would say that this 145 billion is as good an investment if not better than what EU money has been spent on so far.
Central banks and governments pretty much already committed to drive a planned economy. EU subsidises farmers (among others) to sell goods at cheap prices, which causes consumer prices to drop and in the end the ECB says inflation is too low, so let's print money to buy more gov bonds. Governments then use the money to subsidise something else distorting the markets and it loops back to disinflation and the central bank printing even more money.
It's a joke. Might as well just admit, semiconductors or not, the future of the economy is with the politically preselected winners who get the subsidies and the loans. Risk premiums, collateral, macroprudential regulation, insurance and so on is for the peasants.
> The EU has ASML, NXP, Infineon, maybe STM (not sure) and a ton of little shops, but all of them are far away from the major players.
They don't need to become major players for this program to be a major success. Both India's and China's push for a native self-sufficient industrial capabilities have been a huge success in spite of not delivering a cutting edge processor.
Moreover, AMD showed that right now the key factor to develop a product line that dominates all competitors in all categories, from performance to power efficiency and also price, is access to a capable manufacturing hub.
"Sovereignty" is an important concept that dropped out of American discourse in the 1990s. No self-respecting country relies on foreign cryptography to protect its diplomatic communications.
Similarly, no self-respecting country in 2030 will rely entirely on foreign integrated circuits. FPGAs will play an important role for small countries, but large groups like EU can afford to go big.
Sovereignty matters when you can’t trust there won’t be supply disruptions due to war, piracy, or trade intervention.
Post ww2 the US had no reason to be concerned with any of the above in the western world, following the collapse of the USSR this mentality was extended globally with the belief that “we’d reached the end of history”.
As of 2020 I don’t think any major power considers the risk of trade interventions or war to be negligible. The us navy may no longer be capable of ensuring freedom of the seas unilaterally.
There is a lot more to a communication system than the primitives it uses. Even holding primitives constant, there is a lot of room for variation (and bugs and side channels). Recall that one of the early identifiers of equation group was subtracting 0x61C88647 rather than adding 0x9E3779B9 during RC6 key setup [1 p. 28]. So I guess what I'm saying is nations don't just download AES bitstreams off the internet.
>"Both India's and China's push for a native self-sufficient industrial capabilities have been a huge success in spite of not delivering a cutting edge processor."
Could you elaborate on these huge successes in these two countries? I do remember hearing that India had produced a SPARC-based chip.
When you can use the twice the number of transistors and they use 1/3 less power that is a pretty big advantage to work with.
You might have the best car design in world, but if all could use was wood vs someone else who had a crappy design, but had aluminum the crappy designed car might work better.
Not saying this is the case with AMD vs Intel, but right now Intel's manufacturing is hurting them.
ASML is impressive for sure, but having the litho doesn't mean you can make good chips.
As a mediocre analogy, you don't expect to be able to write good novels because you got your hands on a printer.
I think much of the relevant general-purpose chip design knowledge we had (ARM) left the EU this morning. I don't yet see any other chip company (eg NXP etc) suddenly be the next Intel or AMD yet (let alone the next Apple).
The RISC-V foundation moved to Switzerland primarily to help the big Chinese processor companies to work on RISC-V.
Regarding the EU heavily betting on RISC-V, what gives you confidence that this will work?
The history of EU funded projects to catch up with the US in AI, in cloud computing (like GAIA-X), in quantum computing, in the space race? HPC is not a mass-market, how should this niche be economically viable to amortise the huge cost of processor development? HPC in the US (and other countries) is often connected to military spending (although this is not always openly expressed). Processor development is extremely expensive, to the extent that Intel is now struggling to finance catching up with TSMC's fab process.
Where is the EU's micro-architecture design capacity? ARM is about to be swallowed by Nvidia, and a lot of Arm's micro-architecture development is done in the US already. Now compare the micro-architecture design capacity with that in China (the world's biggest processor market).
I really hope it will work out.
I do too.
Given 40 years of failure to catch up with the US, and now China, I am sceptical! I expect this to end up like previous EU attempts at catching up: the monies available will be much smaller than originally announced (by at least an order of magnitude), spent over much longer a time-frame, but more importantly, mostly flow to existing EU-based companies that are good ad lobbying, e.g. Siemens, and French conglomerates.
Another prediction: China will soon dominate RISC-V, since they are now forced, by US sanctions, to move away from Arm. I cannot see big Chinese processor companies moving to local ISAs such as Loongson. Alibaba announced a RISC-V processor at ICSA this year [2]. The big US players (Intel, AMD, Nvidia) have much less of a need to move to RISC-V.
> The RISC-V foundation moved to Switzerland primarily to help the big Chinese processor companies to work on RISC-V.
Of course. It also removes unnecessary anxiety for the EU that the next ruling power in the US (or elsewhere) may eventually attempt to impose sanctions on the export of the IP. Switzerland, as part of Schengen and Union's single market, fits nearly perfectly into the narrative of European consolidation.
> what gives you confidence that this will work? [...] Where is the EU's micro-architecture design capacity?
I can't see the future, hence I have no confidence. But I express cautious optimism for the following reason: the issue of EU's dependence on some crucial technologies from the third parties is obvious, but there's no direct and quick solution to solve it. The EU can't just turn into venture capital Mecca overnight, the same holds for becoming a low tax heaven. However, the problems/challenges are there, and they must be addressed in the best way under the given circumstances.
The EU has a well-established practice of funding R&D in large areas with non-specific goals or metrics, however this approach is not unique to the EU, it's crucial to the bloc to nourish the interbloc integration and establish logistics between the disparate parts of the market and institutions. It doesn't always lead to unexpected discoveries or breakthrough ventures, but in general it manages the integration task quite well. Which, in turn, contributes to the development of a rich ecosystem. As a tech entrepreneur in the EU, I'm not exactly happy with current affairs, but satisfied with the recognition of my industry's difficulties and proposed attempts to solve them. A failed venture with some new sprouts at worst case, a tangible breakthrough at best.
So far, the EU holds leading position in the lithography systems (ASML). The EU is competitive in radio (Ericsson, Nokia) and embedded (NXP, Infineon, STM) semi manufacturing. There're many blank spaces on the European vertical technology stack, but it's far from a blank slate. This whole commitment is about EU pushing homegrown processor sovereignty across the entire stack. AFAIU, the project puts the focus on HPC as the only specific target platform that needs to be manufactured, but the developments around this project should lay the ecosystem for the boost of the industry as a whole.
Companies such as Apple[1], Microsoft[2], Amazon[3], Google[3], and especially fresh start-ups like Nuvia[4] and Ampere[5] — are working on new ARM-based CPU designs, while SiFive[6] and some others on RISC-V. Also, I'd speculate that AMD and Intel will have to consider switching from the X86 in the foreseeable future. Now is the best possible time for venture into the semiconductor industry in the past few decades. I don't underestimate the complexity of the task. But perhaps a fraction of €145bn would be enough to plant a seed of a viable EU-based CPU semi enterprise; or is it definitely a doomed undertaking, eh? Maybe that French SiPearl[7] or some other company will take chances, we shall see.
The foundation just coordinates the standards process and sets rules for using the trademark. It has a tiny budget and few staff. All substantive R&D is done by its members, which are companies of various size with headquarters in various countries: https://riscv.org/members/
Changing where the foundation is incorporated doesn’t change where this R&D happens.
ARM IP, even full architectural license, is relatively small percentage of the cost of a semiconductor. Know-how for fables microarchitecture designs is widely distributed. Most fabless work goes to specialized asics.
It's the inability for SMIC to obtain EUV lithography equipment for their sub-7nm process technologies from ASML that prevents China from getting into high-end semiconductors, not the domestic microarchitecture know-how.
Here is an interesting question: how long will it take China to catch up? I predict 10 years! The Chinese government sees a leading position in semi manufacture as being of extreme strategic importance. There are several reasons why I think China will succeed other than government strategy: the size of the Chinese market (already the biggest processor market in the world), the ease with which Taiwanese semi expertise can be brought to China (legally, salaries are just higher in Shanghai than in Taipei).
I think they squandered that recently. We will see with Biden but the Trump administration basically encouraged Brexit and repeatedly adopted anti-
EU positions in key geopolitical issues (Syria, NATO, Iran, Israel, and Ukraine). These things come with a cost and the EU will try to rectify this. Enhancing Chinas CPU tech by a few generations might be worth it if it can advance EU interests and ensure future good-faith from a supposed ally.
Enhancing China’s CPU tech even a single generation is in the EU’s interest in exactly 0 alternate universes, along with this one.
As long as the US has the world’s only reserve currency and as long as the EU economy - especially the productive bit in the North - is built on exporting to the all-powerful US consumer, the EU has very little leverage in its affairs with the US.
Yeah but that's ARM IP though. There's a window of opportunity with RISC V, but something tells me that the fact it's open source rubs against some people.
No it hasn't, and the type of deal it is going to get looks likely to be different under Biden than under Trump. I think your point is relevant regarding ARM-Nvidia, as semiconductor technology has tended to be the subject of trade barriers, and is seen as a strategic national asset.
Yeah that’s what I was kind of getting at ... great British success story, bought by SoftBank Japan coincidentally straight after Brexit. Would have been a good asset to have in trade negotiations. The sale to US based Nvidia 3 months ago is an interesting twist that would have gone against the EU had Trump won again.
> I think much of the relevant general-purpose chip design knowledge we had (ARM) left the EU this morning
Worth noting the Sophia Antipolis arm design centre in France continues to exist. It works on some of the big A-class cores (The A75 for instance: https://en.wikipedia.org/wiki/ARM_Cortex-A75).
Though whether arm would get involved in this endeavour is another question. They have a significant physical IP portfolio: https://www.arm.com/products/silicon-ip-physical and associated skillsets (I think at least some of this is UK based, not entirely sure how much) so would be a good partner to have and I suspect arm would like to see arm cores coming out as test designs rather than RISC-V cores. Of course in the wake of brexit potentially not a partnership the EU wants politically! UK government would spin it as UK company plays key part in major EU initiative with significant funding awarded. EU would spin it as EU brings in major global semiconductor company to new semiconductor initiative.
The company has offices and design centres in Copenhagen in Denmark; Oulu in Finland; Sophia Antipolis in France; Grasbrunn in Germany; Budapest in Hungary; Galway in Ireland; Trondheim in Norway; Katowice in Poland; Sentjernej in Slovenia; Lund in Sweden.
Your analogy works if ASML makes the only printer that can print the letter 'S'. Without it, you can't print and sell the books, regardless of who the author is.
The previous top model NXE:3400B, "weighs 180 tons and needs 20 trucks or three fully loaded Boeing 747s for shipment. The price tag is $120 million." [1]
Most of that is packaging, seriously. The purity requirements and vibrational limits for those parts are very high.
ASML has plans to get into sub 1nm level. 2nm and 1.5 nm is already in the pipeline.
The technology high-NA EUV (high Numerical Aperture Extreme Ultraviolet) becomes just insane. Mirror manufacturing process requires atomic scale corrections and the whole metrology is moved into vacuum.
The limit for mass production is measuring and calibration. The measurement accuracy is comparable or exeeding Large Hadron Collideror gravitational-wave astronomy. The speed (wafers per hour) must eventually slow down, requiring more machines and making the process more expensive. Then Moore's law finally dies due to the cost.
> At its most sensitive state, LIGO will be able to detect a change in distance between its mirrors 1/10,000th the width of a proton! This is equivalent to measuring the distance to the nearest star (some 4.2 light years away) to an accuracy smaller than the width of a human hair.
I’ve heard this often repeated claim about ASML owning the core tech behind TSMC’s 5nm process. However if it was just a question of buying N 200 million dollar machines to launch a 5nm foundry wouldn’t we see dozens of 5nm competitors? Why hasn’t intel , apple, Samsung, or AMD shelled out for 10?
Given the size of this commitment it seems clear that there is a lot more to 5nm than the lithography machine.
It also adds the question what ASML has to gain from handing over their technical advantage to some local gov effort.
I mean they can get paid but there’s a ton of other companies not starting from scratch they can also make billions off of so I don’t see why some geographic thing is some huge advantage for EU.
They already operate in a highly lucrative global market with companies who don’t need to figure anything out.
If anything this should be expansion capital or efforts to build more factories locally. Not trying to do it themselves.
But hey what do I know. I don’t have multiple countries with lagging tech interests in mind with lots of money to burn.
Yes there is whole part of equation that has nothing to do with ASML. But the point, to over simplify things a lot was that without ASML there are currently zero chance you could get leading edge node working. But even with it you have barely started.
Reminds me of when I saw the customs declaration they had to make for the Troll oil platform[1]. It was "a thing" made here in the country, and it was being transported out of the country, so of course they had to customs declare it...
The declaration essentially said "one oil platform, unpackaged".
There was a suitable tariff code for it, but the value of it was so great the electronic customs declaration system couldn't handle all the digits.
Instead they had to write the value as a free-text comment.
Most gigantic blast furnaces, or hydraulic instruments on record if you correct for inflation? Though, most things like these made little sense economically even back in the days they were built.
Fascinating. Had to look it up — the photos of it are mind boggling.
I have to say though, from Wikipedia, sounds like there are only a few of them? Sort of one-offs, each of them (so to speak). I kind of think that might disqualify them.
(I know this comment is not exactly in the mood of HN, but this is the one thing I never fail to think of when someone mentions the Bagger family of murderous machines!)
Yes. The correct term for TSMC should be GigaFab, which was used long before Elon coined GigaFactory.
It was named as such because of the scale and capacity of those Fab as compared to other pure play competitor. It was also one reason how TSMC manage to win by Economy of Scale.
So, first thing when it comes to big dollar (or in this case Euro) numbers: some of these funds will be loans, not grants. In this case the split will be about 50-50.
Second, this is not new money, this is part of recovery funds already allocated in July 2020 for combating the economic recession created by the Coronavirus [1]. These funds were already earmarked for environmental and digital initiatives. This declaration is probably a clarification of how much is given specifically to the digital initiatives.
This looks quite smart to me. In the US neither the original CARES act ($1.4 TN) passed in March, nor the new stimulus bill ($0.9 TN) has any funds dedicated to cutting edge industries. There were instead funds for airline companies and cruise lines.
> In the US neither the original CARES act ($1.4 TN) passed in March, nor the new stimulus bill ($0.9 TN) has any funds dedicated to cutting edge industries.
That's because the US largely doesn't have to do that. The reason the US has a couple hundred major technology companies and Europe doesn't is due to its far superior venture capital market, which Europe almost entirely lacks by relative scale and so it has to try to make up for it with government money (which has been a repeated approach in Europe going back decades now, it hasn't worked well).
This is true. Canada has been trying to spend hundreds of millions or billions (under a series of different names and projects) to develop a domestic SV like tech sector and it keeps failing.
Our smartest people keep leaving to the US and taking US venture capital. Or selling to US companies. All for very good reasons. It’s where the rest of the smart people are. I’m convinced that’s what matters most, the people, not just billions of dollars won’t replace that.
If anything it’s quite obvious the US gov should be investing in infrastructure (transit, urban development, etc) like a good gov instead of venturing into even more territories pretending they can compete with highly advanced industries (be that finance or tech).
These governments, not just US, have enough things they are already struggling to deliver on. I really wouldn’t recommend they also pretend they are venture capitalists or worse starting the organization themselves.
Even old school NASA success was a lucky collection of semi-nationalizing a bunch of already successful private industry, academia, and a hardcore Cold War patriotic mission. And I should note one of the most famous people who helped get the US to the moon was Canadian: https://en.wikipedia.org/wiki/Jim_Chamberlin
One could argue NASA slowly lost that powerhouse ability as it became just another hundred billion dollar gov project. They still do great things but nowhere near the scale or speed as the past.
There is a missing bit of perapective: many EU startups rely on grants for bootstrapping because investors here are a lot more risk averse here. They commonly let folks get their startup to an MVP and become investable.
The other factor is that they come in waves: there could be many grants for your startup for a few years, then government focus shifts and they dry up, then 5 years later they might come again
Aquiring the grants and completing the required paperwork feels a lot like doing schoolwork - it's tedious, but certainly doable, I have won 2 grants a few years back for my startup, its not like you have to be a big corp to stand a chance.
I won a grant for our company, roughly 600k, but it took nearly 2 years until the first money hit our bank accounts and the ongoing documentation effort is really slowing a lot of things down.
But it might be because it's Germany, you have to use your regional bank for the process and ours was horrible.
Still, I think the 2-3 years is too short. I believe if you put in a lot of money into something it needs a bit of time, otherwise every participant will just do whatever they normally do, just more of it.
It's obviously easy to say this in hindsight and it wasn't necessarily obvious when this started, but it definitely cost more than it had to because it was an EU project that had to hand out work to all the funding countries.
I am curious what investments have worked out for the EU, but if the LHC is the pinnacle, it doesn't inspire much hope.
Yeah well it wasn’t and in all the years since nothing better has been either. And the reasons for that are specifically the flaws in the commercial approach.
The modern web is nothing at all like the original one, so I don't really feel like it makes sense to say nothing better has come along: many new things have come along and replaced what was originally created.
But the bigger problem with arguing for projects like the LHC or the moon landing based on the side benefits of what was invented there is that there isn't really a demonstrable causal link and it provides no real support for any of the actual projects being undertaken, just to the idea of employing smart people in an environment with free time.
I contributed to a couple of projects that received money from FP7 (sort of the previous iteration of Horizon 2020). In a certain sense, the whole thing seemed like a huge waste of money. Software (and hardware) projects were completed, and nothing was ever done with them. We produced over 20k pages worth of paperwork (which was all mandatory if we wanted to get the money), which I'm guessing no one ever read.
Don't get me wrong, it was all developed with good intentions, but those have been known to pave the road to hell. From a personal point of view, I learnt a lot from the experience. But there are probably more efficient ways for software engineers to learn than by doing FP7 projects.
I was just a cog in the machine, perhaps someone further down the pipe got some benefit out of what we were doing. But given how the projects were managed, I doubt it.
This maps onto my experience with an Horizon2020 project. I don't want to say that it is wasted money, rather just point out that it feels like a spray&pray approach. We travelled a lot, produced a lot of excel and word documents in a very inefficient way, the outcome, despite being the project "successful", is completely useless and will never see the light as a commercial product, not even as a useful blueprint for other organizations. All in all it was a depressing experience, knowing that we were going on thanks to taxpayer money. R&D is good and I don't want to bash on these initiatives... I guess I just ended up in a project that didn't go anywhere.
> I contributed to a couple of projects that received money from FP7 (sort of the previous iteration of Horizon 2020). In a certain sense, the whole thing seemed like a huge waste of money.
I guess your mileage does indeed vary. I contributed to a subproject of a major FP7 research program, which counted with the collaboration of a major industrial manufacturing company, a state research institute, and a couple of university research groups. In the end, besides a hand full of research papers, the industrial company developed a commercial product which is being rolled out as we speak. The state research institute didn't gained much out of the deal but we did developed institutional relationships that have been fruitful since then.
What you take from a research program is proportional to the legwork you put in. I'm sure some projects aren't immediately fruitful but it's short-sighted to claim that the money is wasted, specially if you take into account that this expenditure is what makes this sort of industrial effort possible.
I'm guessing the state research institute got some funding and visibility ('dear tax payer or high-level admin that cares about public image of state research, what you paid for - our research on topic X - for Y years is now being used in industry, see?') and that's what makes/helps them run so they probably also got some things out of this.
> But isn't this typical to R&D ? that only 1 of N projects gets used for commercial purposes ?
The OP forgot to mention that one of the goals in the Horizon2020 projects is to provide incentives to create pan-european collaborations involving industrial, academic, and institutional organizations.
In short, they are aimed to bridge the gap between academia and industry, and also create synergies between multiple organizations across Europe.
For example, some programs require applicants to partner with research institutions and industrial companies of significant and arbitrary size to be able to even submit a proposal.
Thus, it's disingenuous to evaluate the success of these programs in terms of commercial products being developed out of these programs. The political goals of developing collaborations between member-states is far more important than delivering a gadget or a trinket.
Similarly, we have the Erasmus program that enable higher-education students to spend a year in a school from a member state somewhere in Europe. It's disingenuous to assume the goal of the Erasmus program is solely academic.
As someone who came from academia, now runs a commercial company, and having participated in several large consortia projects (including Horizon 2020), I find your perspective… charming.
I hope you never get to experience how the sausage is made. And where you taxes really go.
I agree it's very difficult to run large-scale research projects with consortia, etc. And even worse at EU scale with public money. I'm not sure whether there's a better way to balance the admin-load against all the scamming, or to avoid 'favoring' one nation's industry or other. When you do something on processors, you'll probably have to keep the door open to all big & small European actors, right? I feel all the administrative overload is a way to avoid all kinds of political problems.
Yes, Europeans complain about bureaucracy from the EU and here about the ERC, but the moment someone comes with more 'pragmatic' processes, either you see some 10+MEUR-level abuse quite quickly, or you get some blast about bad management of the tax payers money, and calls for more oversight.
I don't have a solution, and without a united EU military/defense budget I don't see anything DARPA-like emerging. And it seems only European military budgets (still sovereign) and regional budgets (regionalism being, to me, the biggest flaw in the modern EU vision) seem spent on 'low admin we trust you let's try this just convince this panel of scientists and admins' funding. While I think it's great for labs/research funding, for product derisking and creating competitive edges for the local industry, and for SMEs and overall high tech employment, you're not going to create a semiconductor industry like this.
I've seen the results of several ERC consortia projects and am sometimes impressed with what EU-based research (academics+smb+large groups) can do with so little money (on each subject) and, yes, so much admin overhead.
> I hope you never get to experience how the sausage is made.
I appreciate your arrogance, but as you might notice by reading my comment I already have more than enough experience making said sausage. Thus your complete lack of arguments, which you tried to hide with snide remarks and an unimpressive attempt to appeal to authority, were dully noted.
> you might notice by reading my comment I already have more than enough experience making said sausage.
I noticed nothing of the sort. No need to lash out – you probably meant to describe your experience but then forgot. I'd be curious to hear. I'm not psychic, and your account is anonymous.
OK, so you've had good experience with the EU bureaucracy and its "innovation funding" schemes. What was you role in them?
But not every R&D project can or should lead to a commercial product right away. I work in a big corp and sometimes the tech you invested in, even if the PoC was great and all successful, doesn't fit in any final product because of thousands of other constraints.
But I also see lots of small 'mindshare' changes thanks to those 'it can be done' projects. The important steps seem to be to first unlock the first TRLs, then find PoCs on real products to inspire (and increase TRLs) tech directors and product managers that they need to invest the next millions into an big and still uncertain shift, and to underinvest in other important parts of their products. In the case of tech push you often end up with a new shiny tech that can't be used right away. So, mostly, it's about climbing the maturity ladder, and be ready for the very small openings in the product development cycle to shoe your new tech in.
In the case of customer pull or market pull, the lead time of such projects makes it too late to ask for external help, and no research grant wants to participate in 'product development' (not their job). So the tech is usually badly implemented and leaves a sour taste.
What I see as positive: if you have a great tech idea and available resources, and great academic/labs contacts, you can get the money, with little resistance (but yes, lots of admin work) with either European or national/regional grants.
IIRC the 2014 version of SPARK was designed and developed through a French civilian R&D funding project : http://www.open-do.org/projects/hi-lite/
The project was clearly a success there (although I don't know about ROI or profitability for AdaCore on this tech). Working with innovative SMBs is a great way to get funding in France and most of the projects that I've seen tend to conclude in new products... for the SMB. But the scale is low there (<4MEUR), so it also helps to accept failure ('only' 4m 'wasted'...).
Funny thing, the wiki page explicitly cites horizon2020 (which one of the GPs criticized): "The European Commission advised EU-funded research and innovation projects to adopt the scale in 2010.[1] TRLs were consequently used in 2014 in the EU Horizon 2020 program. In 2013, the TRL scale was further canonized by the ISO 16290:2013 standard.[1] A comprehensive approach and discussion of TRLs has been published by the European Association of Research and Technology Organisations (EARTO).[3] Extensive criticism of the adoption of TRL scale by the European Union was published in The Innovation Journal, stating that the "concreteness and sophistication of the TRL scale gradually diminished as its usage spread outside its original context (space programs)"."
It’s more than that in my experience, often the concept was a non starter, or the output is nothing an enterprise couldn’t do it self if so motivated, and certainly aren’t going to bother picking through the mess of some academic code base.
I know of two companies getting money. The first ones entire business model is EU funds. They “make” only the necessary burocratic documentation. They have zero intentions of producing anything. The other is large and dirty af with bribes.
If you try to compete with them for EU grants, you are going to get an investigation into your business for misspending EU funds. Because they know the right people.
I might have looked positively at this if the bureaucrats would have actual skin in the game and would be judged by the outcome in 5-10 years. But in the likely case that this will fail and most of the money will be drained through lobbyism etc., nobody will talk about it and they will come up with the next thing they can throw money at to come across as being super innovative.
Disclaimer: I used to work at a company that was particularly good in draining these kind of funds without delivering useful outputs.
Maybe you could use your experience to propose a system (whether funding vehicle restrictions or proper incentives) for that not to happen in this case? I think we’d all be excited by that.
How can we avoid spending money on lobbyists? Maybe the structure should be more VC-like?
"More VC like" has been proposed by Mariana Mazzucato. If the state invests in a startup/spinoff, the state should get equity in return rather than just some lofty words about future jobs or such.
Not for the purpose of creating long time state owned companies, but for cashing out when/if the investment is successful, just like VC's. This would both provide the state with money, removing the need to raise that same money via taxes, and hopefully also better align the incentives of the funding organisation by providing measurable goals.
Putting structure aside for now (although I agree we want an answer to that), I don't see why we even want governments allocating capital to projects like this
in the first place when the space is already very competitive with loads of private money. It seems like a classic case of big government doing big government things to justify their own existence.
It is arguably quite ideological to insist that a large monopolistic bureaucracy, or a conglomeration of them - e.g. the EU - will be efficient in allocating vast amounts of resources when basic game and microeconomic theory suggests otherwise.
Still, an argument for state subsidies, despite some inevitable degree of inefficiency, can be made.
Point was that despite repeated successes with this style of investment the libhurdurians still insist it’s a bad idea, totally blind to the fact that lassaiz affaire is just as prone to degeneration. It’s ideology as much as any other approach and when you find people insisting on it without any concrete examples it’s just plain ideology you’re dealing with and there’s just no point wasting your time.
I'm a libhurdurian and I don't think it's necessarily a bad thing. A public goods argument can be made for strategic investments.
I also don't think it's been conclusively shown that there have been "repeated successes with this style of investment". Demonstrating that would require knowing what the opportunity cost of the spending for these projects was, which is impossible. Claiming it's an open-and-shut case that these kinds of investments will yield positive results is just as ideological as you accuse dissenters of being.
I’m not claiming it’s open and shut. Every time something like this comes around you have all these guys giving out. I don’t say free market doesn’t work in all cases but just that it doesn’t work in all cases. Libertarianism is a dead end. Also BSD Unix.
Your earlier statement, that "lassaiz affaire is just as prone to degeneration" is just as ideological as anything you responded to. Neither of you have proven your case. It's entirely possible that you are right, and there's a factual basis for your assertion. It's also entirely possible that the party you are in opposition to is right, and there's a factual basis for theirs.
Neither point has been supported in this discussion with anything beyond rhetoric.
If it does succeed, it will be a perpetual, repeatedly brought up, example of how the EU can get things done. The other projects will remain forever forgotten.
Government spending isn't the problem, it's who gets the money.
In the US I see it all going to established players. Which is fine for stuff like finding a COVID-19 vaccine. But is a total disaster for promoting innovation.
I have a computer engineering degree and have watched nothing of interest happen in semiconductor manufacturing for over 20 years. Yes we have blue LEDs now. Yes we have fast video cards. But if you look at single-threaded performance per clock cycle, it's been stuck within the same order of magnitude since the Pentium got 20 stage instruction pipelines and huge caches (which in hindsight were big blows for SIMD and MIMD).
It would take a paltry amount of money, in the low millions of dollars, to design real (general purpose) multicore processors that deliver orders of magnitude better performance than what we have today. But unfortunately lawmakers are for the most part technologically illiterate, and technologists are unduly skeptical of any type of programming outside the mainstream.
So my dream of a sub-$1000, 1000+ core CPU with a modest amount of RAM per core (between 1 MB and 1 GB) that can be programmed with existing tools like Erlang/Go/MATLAB/Julia and even Docker is just never gonna happen. And without that, there is no viable road to really experiment with stuff like AI, physics simulations etc without renting time in the cloud. We have the impression that progress is being made on these endeavors today, but things look a little different to me, watching them play out at a glacial pace, at mind boggling expense, over 3-4 decades. I mourn what might have been.
If the money required "to design real (general purpose) multicore processors that deliver orders of magnitude better performance than what we have today" is in low millions of dollars and technical challenge isn't too daunting, why haven't VCs invested in such ventures?
I do NOT believe that you can deliver "orders of magnitude better performance" general purpose multicore processors for low millions of dollars!
The salary for the verification engineers would already probably exceed low millions of dollars after 3 years. Not to mention licensing cost for EDA tools you need to tame billions of transistors.
I will give you low millions of dollars if you have a viable path to orders of magnitude better performance general purpose processors.
> It would take a paltry amount of money, in the low millions of dollars, to design real (general purpose) multicore processors that deliver orders of magnitude better performance than what we have today. But unfortunately lawmakers are for the most part technologically illiterate, and technologists are unduly skeptical of any type of programming outside the mainstream.
>
> So my dream of a sub-$1000, 1000+ core CPU with a modest amount of RAM per core (between 1 MB and 1 GB) that can be programmed with existing tools like Erlang/Go/MATLAB/Julia and even Docker is just never gonna happen. And without that, there is no viable road to really experiment with stuff like AI, physics simulations etc without renting time in the cloud. We have the impression that progress is being made on these endeavors today, but things look a little different to me, watching them play out at a glacial pace, at mind boggling expense, over 3-4 decades. I mourn what might have been.
I'm really curious what specifically you mean by this. I see similar issues on the software side (my degree is in CS). Software is incredibly bloated and horrible at interoperability. Unix had pipes back in the early 70s, and somehow with GUIs and then mobile "apps," we've regressed. Identity-based security has failed time and again. And only rarely has software design progressed meaningfully beyond structured programming from the late 70s (not to mention the languages). Moore's law has given software developers around over 100M x improvement over the past 40 years, yet ordinary people would scarcely notice.
TL;DR: I see a lot of the same flaws in software, dominated by fads and popularity only of what is mainstream.
I'd really like to hear a dissident point of view from the hardware side.
Ya I hear you, I started with C++ and dabbled in 68000 assembly back in the early 90s. The biggest problems back then was the main loop and that a program could only get to a million lines before it was too unstable and crashed. Even just the protected memory of Java, or protected memory in general, felt like a distant dream.
Now we have event-based apps but we're also stuck in the purgatory of async hell. Hundreds of classes got replaced with hundreds of factories and having to endlessly learn DSLs. Compilers mutated into handwritten unit tests. I feel a heaviness in my chest just writing this, because one thought leads to another and it's hard to articulate the root of the discontent. I still believe that the web way is better than bare metal, but I'm saddened to see it reinventing the bad habits that we abandoned 25 years ago.
For me, what's really going on is that computers have not gotten appreciably faster since about the time that PowerPC iMacs were running OS X, roughly the year 2000. Before that, computers were getting 100 times faster every decade, and then it just kinda.. stopped. Only video games kept going, the only tradeoff being that we have to use someone else's 3D library rather than just writing ray tracers in a few pages of code (if only we had general-purpose multicore chips).
And that made programmers desperate, because they were still focusing on performance instead of stepping back and seeing the high-level abstractions that were largely understood by the 1980s. Everyone is so used to being compute-bound that we can't even think about solutions outside of that reality.
My "idea" to fix all this, bluntly, is to forget about improving single-threaded performance and start giving people the raw computing power they need to get back to work again. To keep up with Moore's Law, that's a computer with 10,000 parallel threads running at least 1 GHz, for $1000. Or 100 times the cores every decade. My initial mention of 1000 cores was perhaps conservative.
Pretty much all of the problems we deal with today are embarrassingly parallel. A synchronous blocking PHP page is, when served to thousands of users. DSP is. Neural nets, genetic algorithms, stocks, Bitcoin..
So our desktop machines should really be thousands of Docker containers with a total capacity of like 1000000%. No program would ever block another program, or get out of its sandbox. Programs would sometimes run across the internet. I picture it kind of like this big Minecraft Disneyland where you're in VR but processing stuff in the background and forgetting it's there. Maybe you'd devote 50% to an AI agent like J.A.R.V.I.S. that sits around all day backing up its best self and evolving its subprocesses to be even better. Not being compute-bound is like being able to throw processing power at problems declaratively and never having to solve anything menial again. I've been daydreaming about all this since like 1999 hahaha.
The math is all there, I've written about it at length in previous comments. You basically take an old processor like MIPS that was about as optimized for single-threaded performance as one can get, without getting mired in the evolutionary dead end of long pipelines and huge caches. That or the PowerPC 601 or DEC Alpha had on the order of 1-3 million transistors. Looks like the Apple M1 has 16 billion. So the raw numbers do suggest 10,000 of last-century's best cores. Then spend another 10 billion transistors for about 1-10 GB of RAM, or 1 MB of ram in-core.
Yes, memory routing is a pain, but you just use content-addressable memory and treat the interconnect just like any other network on the internet. The cores use caching, compression and copy-on-write to combine the best aspects of Erlang, Lisp, and Clojure. We'd write code in a Javascript-like language that's identical to the ideas from Immer and Immutable.js, but natively. Since everything is read-only, it statically compiles ahead to the best of its ability, running through a monad only when processing mutable state, and then going back to static. When you're not compute-bound, the static stuff processes instantly. It basically inverts the logic, so the only slow part of your code is the IO. My terminology isn't exact here, but it would basically transpile a subset of Javascript to Lisp and then run the embarrassingly parallel stuff 10,000 times faster than we're used to, rivaling the speed of video cards.
To do this as a hobby project, it might be fun to see how many early ARM cores and small RAMs could fit on a chip with a billion transistors. Then see how hard it is to add the content-addressable networking to the OS. Then finally get 1000 Docker containers running with, say, Debian. I used to daydream about doing it on an FPGA, but haven't kept up as closely as I'd like. Also I feel like there is industry pressure to keep FPGAs down, because they haven't kept up with Moore's law either, and never went fully open source like they should have.
I feel kind of weary about all this because I've been thinking about it for so long, and have a lot of regrets about not using my degree more. I'm still just writing CRUD apps like everyone else. It's so tedious, and takes so much code to do so little visible work, that I've lost seasons.
Serious question: Why is the EU so far behind in tech company influence/leadership compared to the US and Asia? Europe has successful tech enterprises, but surely is capable of so much more on a global scale.
Why do you think EU is behind in tech? As pointed out elsewhere in this thread, the lithography machines used by all state of the art IC nodes is designed in Europe. It’s one of the most complex machines on the planet.
Then there’s mega projects like LHC and ITER (international projects, but it’s not pure chance that they’re located in Europe) and Wendelstein 7-X.
My pet example is Nordic Semiconductor, which has an insanely good position in the Bluetooth LE device market. What’s also interesting is that two of the major competitors also design their chips in Norway. Although those companies do illustrate one problem in Norway (and perhaps Europe in general): the lack of capital at certain stages. In the IC businesses it seems most companies are acquired by US companies eventually.
Let’s look at EVs. Europe doesn’t have Tesla. But seems like most European car makers are doing OK with EVs. Arguably better than US incumbent car makers. VWs new platform is one of the most promising right now, although this project has shown that VW has a problem with software engineering. But so does most other older car companies in the world. There are also some interesting start ups that’s more focused on designing/supplying components, such as Rimac and Kreisel. Rimac seems to go toe-to-toe with Tesla on extreme performance.
I believe a lot of robots used in advanced manufacturing is German as well?
In general I have the impression that Europe is very strong in designing/making components and manufacturing machines and such. Things that the end consumer never hears about. Very few have heard about ASML, but everyone has heard about Intel. So maybe that contributes to the impression that EU is behind on tech.
Europe has also been ahead of the US in adopting tech on the consumer side in several areas. The US was in the stone age for a long time when it came to banking and payment for instance.
Why people have this perception seems pretty clear to me. Just comparing Europe to the US:
The US has both the major desktop/laptop CPU designers, as well as both desktop/laptop GPU designers. Of the three major desktop/laptop OSes, two are American, and the last doesn't belong to any particular country, but the primary creator moved from Europe to the US permanently.
The two major smartphone OSes are made by American companies. Two biggest browsers, again, Americans. Maybe three, if you count Mozilla (though Samsung is probably around there as well).
Huge internet/software tech companies that consumers interact with? Facebook, Microsoft, Amazon, Google, Apple are all American. Europe has no equivalent to these, all they can boast is a few smaller ones like Spotify, or business facing giants like SAP (equivalent to that in the US would probably be like Oracle or IBM).
While obviously Europe doesn't have a complete dearth of local software, in terms of major consumer hits, especially the kind that get play outside of the region they originated in -- not much of that going on.
Also, I work at Google Munich, and it's pretty telling how rare it is for people here to get 'poached' by other local tech companies. It happened to a few people I knew...to go to Lyft's Munich office. Other than that, I can't think of any. When it comes to enticing engineers, there just aren't any German tech companies that play in the same league as Google.
The market defines behind "ahead/behind" by market value. None of the top 5 market caps in Europe are in tech. They are Nestle, Roche, Total SA, Novartis, and LVMH. They are tiny in comparison to the US tech giants.
All the anecdotal evidence you provide is nice, but is not represented in the market.
An example you give, Nordic Semiconductor, has a market cap of $3B.
Here's a good list of the worlds largest tech companies. The first European entry is #14, ASML:
Allowing companies to grow to the size of Facebook/Apple etc. is more and more being clearly demonstrated to be a bad thing.
The last time the relative size of US tech giants to EU companies was brought up here, a commentator replied that EU law is designed to prevent companies growing to this kind of outlandish size. I have no idea if that's true or not, but if so, it seems like a prudent approach even if we miss out on brownie points of getting to claim "ours is biggest". As others have pointed out here, the EU is not behind technologically. All we're behind on is company size, and I'm ok with that.
I can't speak for the entirety of the Europe but from my experience with certain countries in the EU, there is a pervasive culture of avoiding risk at all costs in favor of stability. The culture extends from the government to investors and even employees.
Government has no appetite for creative destruction and pushes policy favoring large incumbents over upstarts. Investors have no appetite for risk and only seek conservative investments. The best minds (that don't leave the EU) would rather work for large companies, schools, government, etc. than at smaller, riskier organizations that may not be around in a few years.
My family in Europe thought I was a loser and/or crazy for leaving a job as an adjunct professor to work at a 100-person startup. It makes no sense to us but it's understandable to someone who views landing a lifetime cushy bureaucratic job as the gold standard.
That's a deep question that is asked nowhere near enough. And when it is asked, my experience has been it's mostly been Americans doing the asking.
Here's a story. I was once visiting Silicon Valley for work and getting dinner with a friend who lives there. I'm a Brit who lives in central Europe. On the way over I'd bought a copy of Der Spiegel, which likes to write tabloid-esque articles about the Power Of Tech Firms. The front cover this particular week was one such article and I had found it kind of funny, so I was showing it to my friend and we were discussing it.
Next to us in the restaurant was another table with an elderly gentlemen dining alone. Suddenly he leaned over and joined our conversation. It turned out he was some sort of economics academic and one of his 'research interests' was this question of why the EU doesn't generate tech firms. He had a lot of insight and I've never forgotten that discussion: it has influenced my thoughts about how to set up my own software firm.
One of the points he made is that outside the USA there's no real culture of granting early employees equity, whereas in the US tech industry that's standard. ARM is apparently one of the few exceptions, in which the co-founders did in fact hand out equity early on. The incentivising effect this produces is profound. I've felt it myself - when I joined a startup, having an ownership stake as well as a salary made the difference between doing the work, and genuinely caring about the company, being willing to get into arguments and fight for what was important, etc. So a culture gap with respect to ownership is perhaps one reason.
The man made other points that were more commonly observed, like the different approaches to regulation. A few days ago people were surprised to discover that the UK/EU Brexit treaty mandates SHA-1 for some obscure data interchange format. This is typical for the EU. In the US people at least pretend to care about the innovation-harming impact of regulation, even on the left. There's zero culture of that in the EU. The EU views more regulation as inherently good, and anything that isn't caked in hundreds of pages of regulations as being merely on the TODO list. It also brooks no dissent: one of the EU's "red lines" in the negotiations was that they didn't want the UK to undercut their "standards", defined as regulation. Any country that attempts to deregulate gets taken to court by the EU Commission itself, in its own courts, which almost always rule in favour of the Commission regardless of what the law actually says. This creates a one-way ratchet of ever more convoluted and obsolete rules, which in turn imposes a thicket of complexity costs on companies that have other things to focus on. Many of these rules are justified on the grounds of making trade easier but often have the opposite effect.
Finally there are the very real cultural aspects. The US/Valley culture practically celebrates failure. This isn't necessarily good - failure is still failure, but family and friends at least seem to be pretty supportive of entrepreneurs in general and "failure" is very flexibly defined. For instance creating a company that never makes money isn't a problem in the US thanks to a mix of this culture and bottomless VC money. Whereas that would be perceived as failure by family and friends in Europe.
> It also brooks no dissent: one of the EU's "red lines" in the negotiations was that they didn't want the UK to undercut their "standards", defined as regulation. Any country that attempts to deregulate gets taken to court by the EU Commission itself, in its own courts, which almost always rule in favour of the Commission regardless of what the law actually says.
This is standard practice is almost any trading agreement. No trading entity wants to enter a tariff free agreement with another entity which operates lower standards, and thus makes it easy for that partner to undercut their local market.
It’s the entire reason why the US and EU hold tariffs against each other. They don’t want the subsidies or differences in standards to allow one to undercut the other.
The US has similar terms in all their trading agreements, its just that historically the US has sought to export its copyright, tax and drug laws. Hence why most of the western world has drug laws and copyright laws that are almost a copy paste of US drug and copyright laws. Indeed it’s why weed is still technically illegal in Amsterdam. It’s also how the US gets foreign banks to enforce FATCA.
Finally if you want to see some really repugnant trade agreement terms, look up Investor-state Dispute Settlement agreements that the US likes to put in their trade deals [1]
The USA is also one country, one culture, one language, 300 million people as an initial market and a continent. Each of these lower the barrier to entry. The last point point about being a continent is that I can ship across the USA for far less than I can ship from one side of the EU to the other. The USA has economies of scale that Europe still does not have.
>The last point point about being a continent is that I can ship across the USA for far less than I can ship from one side of the EU to the other.
I sell on eBay and Amazon. We Americans have no idea how good we have it in terms of shipping options.
I can ship via USPS a videogame that is, including the padded envelope, 4 oz or less in weight for ~$3 to anywhere in the US (even AK, HI, and PR and other territories).
I can ship as much as fits into a USPS-provided free padded Priority Mail envelope for $7.75, and reasonably expect that it will arrive anywhere in the US in two to three days.
After FedEx ended its relationship with Amazon, it gave eBay Amazon's previous steep discount. In many cases, FedEx 2Day through eBay is by far the cheapest way to get a package from one US coast to the other, even cheaper than USPS Priority Mail and Priority Mail Cubic. This is guaranteed two days or less, as opposed to Priority Mail; think SLA versus lack of same.
Such a discount is available to others, of course. I've written before about how I a month ago made $1700 in profit in three days by dropshipping a popular video game-related accessory from its manufacturer to dozens of customers around the country. I leveraged the manufacturer offering free FedEx shipping to fulfill my orders.
Regarding the expensive shipping in the EU point.
That really depends on the country one is shipping from.
Shipping from Germany is extremely cheap - even internationally (even cheaper than the rates you mentioned).
But shipping the same thing the opposite direction can easily cost many multiples more.
> The USA has economies of scale that Europe still does not have.
If anything Europe has larger economies of scale. EU population alone is 446 million and that's not including countries that chose not to be part of it.
Translating your product into 30 different languages is pretty expensive, as is finding local representatives who know their markets and can advertise efficiently. Americans are much more culturally alike to one another than they are willing to admit.
And from the standpoint of e-commerce, shipping charges across Europe are expensive compared to the US. We do not have any common, reasonably priced service similar to US Post. Sending a package to Spain will cost me more than twice as much than sending it within borders of my own country, and the delivery will take several days.
> For instance creating a company that never makes money isn't a problem in the US thanks to a mix of this culture and bottomless VC money. Whereas that would be perceived as failure by family and friends in Europe.
I guess that's related to the US dept culture too.
Not having money but borrowing it for all kinds of things and with that stacking dept upon dept is quite normal in the US while over here at the continent you usually want to pay it back asap.
So not having money or working for a company which doesn't generate any must feel much better in the US.
I would be terrified. I also wouldn't work for some startup which won't pay be but instead preach something about family values for example.
Earning money and owning stuff that I buy feels great. Wouldn't want to miss it.
Interestingly, in German the word for debt - “schuld” - is the same as the word for guilt.
Having lived in Germany for 7+ years, I noticed there’s a strong sentiment against owing money in general. Odd, considering the crazy high real-state prices these days.
People also seem to save a lot, and consume much less than in other western nations I’ve lived at, or visited.
This may be causing broad economic issues as the money is there, it’s just not moving around as much [1].
True but there is a difference between "jemandem etwas schulden" and a actual credit for a house or something:
Owing someone you know money is probably the worst. You want to get rid of that "Schuld" asap. Even if it's an Euro you borrowed for an Einkaufswagen.
Than there is the "credit" for things you should actually pay from money you have or otherwise not buy at all. Like a fridge or a TV or something like that. You usually don't go around and tell other people that you did that. You pretend that you actually paid for it and that it's yours. This is also where US debt-culture comes into Europe though. You can see for years now that shops encourage going into debt for those kind of products. They try to normalize it because it's easy to hide and pretend.
Third are really big investments like a house or a business. Taking a credit there and discussing those with your friends and relatives is nothing that is frowned upon. Nobody expects you to have that kind of money (and if you had, you'd probably not admit to it).
Well I can certainly say one thing, thanks to EU regulation I don't have to eat chlorinated chicken, the air is clean and I have reasonable working hours and holiday protected by law. You seem to suggest that regulation is always bad, I think a lot of people would disagree.
I visited the UK and the first thing I noticed when I was walking around the cities and towns as how much they stunk of diesel. Air quality made even the worst of US cities look good..
Not sure, if anywhere other than London is moving away really. Especially considering bad public transport outside London, many people has to stick driving to city centres with cheap diesels. My manager was paying £30 road tax for his old diesel whereas my ULEZ compliant car costs above £330.
diesel particulate emissions as a direct result of the EU legislation protecting EU industry cause about tens of thousands of deaths a year, mostly in Europe
No. Diesel, compared to petrol, is worst for short-term air pollution and better for CO2 emissions. And, ultimately, climate change is the biggest danger.
The latter two are perhaps good for employees but are definitely a problem for startup founders who need everyone to give 110% of the company is to survive at all.
As for chlorinated chicken, the EU likes to come up with bogus safety issues to protect French farmers, this is no news. It also has banned GM food, although the health problems Americans have aren't related to chlorinated chicken nor GM foods. The air one has been tackled by others already.
Well, the current European culture is deeply shaped by a immense counter reaction to those times when daring and enterprising men blew up the world twice.
That's why consensus building and failure avoidance are common in Europe. People want good enough without moonshots.
> The EU views more regulation as inherently good, and anything that isn't caked in hundreds of pages of regulations as being merely on the TODO list
One of the best examples of this are the digital tachograph design documents, which are hundreds of pages of legal gibberish mixed with a convoluted tech spec. 100% design by comitee. No wonder the top digital tachograph supplier is VDO and one if the lesser players, Stoneridge, has a much better designed and executed product.
In contrast with this, the US ELD is an 125 page document standardising functionality and the data output of the device.
Yes. Here you can find all the associated documents but I'm talking about Regulation EU 2016/799 and Electronic Logging Device Final Rule specifically.
I run a tech company in the Netherlands. I can corroborate most of this.
Giving employees equity in the Netherlands is nearly impossible without getting taxed to death. The position of the tax authority is that the sole reason you get equity, is because of your relationship as employee, and therefore the "gift of equity" is actually a form of salary, and therefore salary tax must be paid based on the value of the equity. In the Netherlands, this tax is around 50%.
Worse: depending on the exact legal implementation of the equity, you may end up having to pay the tax, based on its value on paper, before actually selling the equity, whose actual market price may be far lower. One could end up losing money just by having equity.
In the Netherlands, having a bankruptcy on your name makes you an ecomonic pariah. The process of going through a bankruptcy is not pleasant and comes with many responsibilities. Starting another company will be difficult. You will not be able to get a loan anymore. Oh, and your phone bill counts as a loan.
There is also a very weak culture of venture capital investment. There are very few such investors, and where they exist, the amounts they offer is tiny (like 10x lower) compared to US VCs, even though they ask the same amount of equity.
I am also not very impressed with the amount of advice/expertise VCs can offer over here.
The Dutch government likes to talk about how much they stimulate the tech and startup scenes. But when capital is concerned, their default answer is that you're supposed to get a loan. Lenders, unlike venture capitalists, are risk-averse (which they have to by law), meaning that they MUST get their loan paid back no matter what, which means that your business plan MUST be profitable, guaranteed, and that you must provide some sort of personal collateral, such as your savings or your house.
The sort of companies the government is thinking of, is for example a factory, where you need capital up front in order to buy machinery. The demand is known, so you know what profit you will roughly make. But this sort of thinking doesn't work for areas with high risk or a high degree of unknown.
For example let's say that you want to make a Twitter. You need money to pay for developers' salaries. But what will your profit be in year 3? It could be 1 million, or 0 (because nobody wants it). When banks hear this, they want a collateral equal to the loan amount. Why would I even get a loan then?
The best thing I can say about the Netherlands is the WBSO subsidy. When you do tech research and development on an area with risk (where risk is defined as being risky to you, e.g. because you have no experience with a particular topic or technology), then the government provides a subsidy for the amount of man-hours spent on this R&D. R&D includes software development too. This subsidy is implemented as a salary tax break.
Plus, when it turns out that your WBSO-subsidized product actually generates profit, then you get a corporate income tax break on the profits generated by that product. This is called the Innovatiebox.
WBSO and Innovatiebox are really nice once you have initial capital and have taken off. They won't help you when you start with near €0.
I"ll echo VC scarcity in NL as a main problem. Coming from Israel I really notice in NL bootstrapped Dutch companies of high quality that are quite happy serving the local market and maybe Belgium and that's about it. No expansion planned, or if one is planned it could take years and years. I read once its due to lack of ambition by Dutch entrepreneurs, but that isn't it. Without VC money its simply realistic to stay local; how are you gonna compete with U.S companies without money? Even the big names in NL like WeTransfer, Mollie, Bux, Bunq etc would have raised way more in Israel or the US. It's quite enough to raise a sizable 1st round in Israel, use connections + acquire traffic and customers to show growth, and then raise enormous subsequent rounds because you showed growth. I'm sure many Dutch entreprenuers could have done the same thing but it isn't possible for them without funding. So they "dream" small.
There are probably a lot of missed chances in NL. On the other hand if the tech VC market implodes again Dutch companies won't be hurt as bad.
>The position of the tax authority is that the sole reason you get equity, is because of your relationship as employee, and therefore the "gift of equity" is actually a form of salary
But they are correct in saying this. You wouldn't give equity to random people would you? And is it not worth money? You might not agree with the tax rate but the two reasons you mentioned are irrefutably true.
Do you really have a problem of obtaining good devs? Seems to me you can get good personnel in a bargain price in NL. It's also super easy to bring people from outside the EU. That's the main reason I think software devs are so cheap in the EU.
Partly we are all hopelessly impressed by American salesmanship.
For example our businesses ignored things like the Acorn Archimedes and bought PCs from IBM instead.
Good news. Yes, as with all government money, there is some pork barreling involved, but there is a long history of such government initiatives laying the starting seed for high tech industry development. It means money is invested in Europe tied to a certain purpose. Giving talented engineers a job perspective and companies a field in which they can invest into.
there is a long history of such government initiatives laying the starting seed for high tech industry development
However, not in the EU. The EU has been engaging in massive subsidisation for decades and has little to show for it. In some places it seems to have led to a hollowed out society in which companies that are supposedly startups spend all their time chasing grant money instead of building real products.
VC investment is hard work. The EU isn't a well run VC firm even though it deploys more capital than such firms do, and it shows: they don't really care what the money gets spent on as long as there's a paper trail they can use to do ass-covering if it turns out the money was lost to fraud. So it creates this USSR-like culture of zombie firms that can't really survive independent of state funding.
It’s almost become normal now that bureaucrats get to decide which social group to spend money on, or which region to renovate buildings in, but the arrogance of thinking you can spend your way to the most cutting edge of current technology is just the next level of bureaucratic arrogance.
That's how we got to the current cutting edge. Research of most important technological inventions of the past century was funded by beaurocrats. Market is only good at figuring out how to make things cheaper and in volume. Both very important things. But true scientific breakthroughs that push the business over next decades happen on taxpayers bill as distributed by beaurocrats.
It sucks a bit that it's this way but if you are profit driven, you can't gamble 140 billion of your own money in hopes of developing new tech.
Yep, this cannot be repeated enough. Government funding is how a lot of innovations happen, but it's not as visible as a private company bringing that innovation to market.
To put in optimization terms, private companies are good at following the gradient. Government funding is necessary to escape the well and find new minimas.
Very well put. Take AI as an example - foundational research in deep learning and reinforcement learning was first done in academia. Everyone knows the story of how long neural networks languished in the shadows, before its time. Even commercial research labs only really took note after the potential of these methods was discovered.
Government funding is a good thing, but it’d be even better would be if we could harness the free market. One solution could be to equip research institutions with the means to capture value from IP that follows on from basic research.
I was thinking in a similar direction. What about an adaptive patent law? Where the duration of the protection in a particular area of interest can be set by e.g. a committee (with a strict ruleset and a big time constant of course). So when there is not much progress in a certain area (e.g. cancer or nuclear fusion) the patent protection is increased to incentivise investments.
A problem with this approach are obviously the unknown unknowns, which might prevent this system from incentivising inventions like the transistor. So this approach can probably only help with problem driven areas and not in cases where the tech innovation gives rise to new problems/solutions
> Government funding is how a lot of innovations happen, but it's not as visible as a private company bringing that innovation to market.
A recent example of 'basic' research coming to fruition in a practical fashion (eventually):
> "S glycoprotein signal peptide (extended leader sequence), which guides translocation of the nascent polypeptide chain into the endoplasmic reticulum" - part of the BioNTech/Pfizer vaccine. I don't ever want to hear anyone question fundamental science again. 1/2
> The level of control and understanding we now have over our biology came from literally millions of person-years spent working on things that at the time were obscure and "useless". And now? We can leverage all this into a 95% efficient vaccine _at the first try_. 2/2
We have no way of knowing ahead of time what knowledge will be needed or "useful" in the future, so in some ways it is prudent to try to acquire as much knowledge of the natural world as possible and sort it out later.
Government funding is extremely wasteful and will generally go into the pockets of the well connected. The problem is this game has been played for a long time and it has diminishing returns. The players have had decades to get the exploitation down.
Yes sillicon valley exists because of government money. But that was like 70 years ago. The world has changed and corruption is more severe. You will get no such bang for your government grant buck now.
Well maybe because in government grants waste and fraud are the rule, while in private startups they are the exception.
And it is the investors problem when a startup fails, and they are aware of it. But with governments, it is OUR money squandered away by politicians and their friends.
Then by your own definition, and the statement issued by the EU commission, this is a bad investment.
I've worked for the large, sclerotic organisations that once put man on the moon. They will take your 100bn, crush it in to dust, and outsource the production of 1 million pages of documentation in 32 languages detailing the workings of something your never asked for. All in the blink of an eye.
Yes. It's bad investment for the one who pays. Possibly great for everybody else and humanity in general.
If efficiency is your thing go into business. The smaller the better. But if you want to have a chance at literal moonshot stay in your job and swallow inefficiencies that come from size, ample capital, and no expectation of monetary profit.
Even if I agreed with you, we are talking about the cutting edge of optimisation, of driving down costs, of doing things in volume. The exact things you also say a market is needed for.
We aren't talking about a military research project like packet switching, or getting to the moon for the first time.
Research of most important technological inventions of the past century was funded by beaurocrats
Important defined how?
The car wasn't. The mobile phone wasn't. Computers in their post-WW2 form basically weren't, for the last half decade if not more it's all been private sector. Yes, DARPA did some very early work on packet switching networks and their work became widely adopted mostly because it was free: nice. But the moment these inventions started to matter, all R&D was taken over by the private sector.
Governments spray so much money at things that I'm sure for almost any broad category of thing, you can find something they funded. But that's no evidence that stuff would never have been researched anyway, given the enormous and long term R&D efforts routinely mounted by non governmental entities. Look at AI: government funded institutions are constantly lagging behind.
It sucks a bit that it's this way but if you are profit driven, you can't gamble 140 billion of your own money in hopes of developing new tech.
Alphabet alone spends something like $21 billion on R&D per year. It doesn't take many years of that to reach $140 billion, and Alphabet is not the only company doing basic research.
Having spent many years reading research papers coming out of both academia and industry, my conclusion has been that the best papers are always those with corporate funding - some academic teams receive partly corporate funding and these tend to be in the middle, pure corporate labs tend to do the most exciting work. The bureaucrat-distributed money often gets allocated for decades to intellectual dead ends nobody cares about, purely through inertia and lack of institutional incentives to maximise ROI.
I don't think that's true. If you look at the computing industry, virtually all basic research is done by companies or academics who are grant funded by companies.
AI? Basically all funded by the private sector and has been for a decade. Universities try to keep up but complain they can't.
Chip design? When was the last time academia contributed much to that? Probably RISC in the 80s? There have been tons of breakthroughs in basic research in silicon throughout my entire lifetime, all of them privately funded. For example look at the recent Optane DIMM tech (based on new chalcogenide chemistry).
Compilers? No, the most advanced compiler in the world is Graal, which is more or less funded by grants from Oracle. The second most is LLVM, which was originally written by Chris Lattner as his master's thesis i.e. he paid for it with his own student debt. Apple pretty quickly saw that it was good work and took over the funding of it.
PL design? Here, academia has indeed done a lot of basic research into various ML derived languages like Haskell. But this has largely been reviewed carefully and then ignored by the languages people actually use - it was basic research into ideas that didn't work well and not many people really care about. All new languages that have got popular for real-world usage in the past 10 years are imperative languages that trace their heritage all the way back to C i.e. Bell Labs (Rust, Kotlin, Swift, Go, etc).
The reality is, the computer industry demonstrates that you don't need government funding of basic research. Industries will certainly accept such research if it happens to be useful because they were taxed to pay for it regardless, but they don't need it.
Companies do plenty of research, just not basic, since they don’t need to: the government funds it instead. With money taxed from said companies, so...
Just like the NASA bureaucrats thought they could make a dent in rocketry - how foolish of them.
Seriously though, some projects are just too expensive and risky for a privately funded venture. That's why public-private partnerships are created - it's always been like this and there doesn't appear to be an alternative.
The US recently spent their way into a cutting edge private space launch provider industry, and that seems like a roaring success. What makes you think it doesn't work?
How much of that was really private? My guess is the NASA launch facilities, former employees, and potential for future contracts were a big part of the picture.
While that's probably correct that without NASA support SpaceX may not survive 10 years ago, on the way to becoming the innovator it is today. Financially speaking however NASA has spent less to buy launch capability from SpaceX than it would have to otherwise.
From the R&D perspective NASA doesn't really have any say in how Starship/Superheavy are developed, which is the cutting edge of space launch. Nor does it dictate the timeline or milestones of the program. Not the same compared to the EU's initiative.
In fact, SpaceX's success shows a different path: let the private sector innovate, provide support in terms of know-how, credibility and potential contracts.
Seem's like though we're still stuck in the Goddard age and most of the resources go towards pursuing such techniques (with a few private orgs that have the lions share of support with public funds that even go towards such ends) of getting into LEO as if there couldn't possibly be any other way worth pursing… how long will we be stuck optimizing Goddard paperclips above all else?
It's also quite funny considering that Goddard himself had to do a lot of work alone, fight public opinion and face the lack of support from the American government, military and academia, all failing to understand the value of the rocket to study the atmosphere and near space, and for military applications, over I'm sure other public-private endeavors that had the blessing at the time (perhaps all the atomic research that provided more strategic benefits?)
SpaceX was almost completely privately invested and private risk. Once they had shown that they were serious, NASA awarded them contracts, because it was a great deal for NASA, compared to what they would pay otherwise.
Its sad to see these kind of attempts to trash talk the SpaceX achievements.
And of course the market. The supply contract for the ISS gave SpaceX the necessary money to grow, without public money no ISS, and as a consequence, no supply contract.
This isn't trash talking the SpaceX achievements but stating the fact that government money played a huge role in developing a space industry which was the base for SpaceX becoming reality.
It's always been normal in the EU. There is little innovation here based on private risk taking, almost no venture capital, and huge barrieres for banks to lend money to innovators.
Hint: it's going to end up with the same results as European AI - a bunch of inept large companies getting money without any results. Top-down approach from basic MBAs down to engineers never worked.
USA entrepreneur: I need to start a company that will attract VC money. Damn, that means a company with huge potential. I better start working.
EU entrepreneur: I need to start a company that can access these juicy governmental funds. Let’s see, what exactly do these bureaucrats want? Hmm, sounds complicated, who do I know in the approval committee? I better start calling.
The world starts realising all the processors that everyone depends on is mainly from Taiwan. I just wrote an article[1] about the importance of processors and talking about key players such that help the semis industry such ASML, and why it's not that simple to get into the game.
. It's not as easy as pouring money into some companies. Sourcing trusted partners + years (decades?) of R&D might be needed to achieve what TSMC did in Taiwan
I hope governments, including EU, will realize that and help (commercially, diplomatically and of course militarily) Taiwan not being invaded by its greedy neighbor.
Ariane has / had a similar reputation to Airbus, the only problem with it is that SpaceX lapped everyone. There were some really bad European projects in IT though, like that big search engine project, Quaero, that didn't deliver any end-user product in eight years and was then cancelled.
If 50% of this is loans and 50% are grants, and if all of the grants are over 3 years, then that's 145/(2*3) = 24.17 billion Euros in grants per year, or $29.33 billion dollars per year. By contrast, in the US, US National Science Foundation (NSF) is the grant-giving agency for most basic science/math research in the US, except biology which is under a different agency (NIH) (also I think DOE funds some energy-related research)) total budget is $8.3 billion per year. So if these assumptions are correct, then this initiative alone is over 3.5x the total US NSF budget.
This is not completely an apples-to-apples comparison because this is obviously applied rather than basic research.
Sweden missing from here is a surprise. We have Ericsson who still design their own chips for telecom devices - one of the few companies left in Europe to do so. And Volvo and Scania might be interested for self-driving cars.
Article says this is for 2-3 years? Seems crazy. Semi-conductor R&D is something where I would expect commitments to be 10 years or more, not just a couple of years...
It's not like we're starting from scratch though, we already have companies and people with ample experience in this field. Not to say that it's not a huge bar to clear or that I don't expect massive delays but I think it's a good thing overall.
And there are still a lot of relevant European companies. ASML, STMicroelectronics (which is Swiss, but is spread across many EU countries as well), NXP, Infineon, Bosch (sensors & semiconductors), etc.
Just pork. Commitment is irrelevant because no real results are expected. Also, election terms make any real commitment unlikely, because results will only come for your successor in office.
Even ignoring specific criticism of RISC-V - the ISA means fuck all if you can't build the actual uarch that implements it. We are probably going to see x86 struggle because of issue-width (although Jim Keller seriously hinted something enormous when he was still at Intel), but the ISA itself (to 1*) isn't much of a CPU
Most precompetitive research in the semi industry also happens at Imec in Belgium.
The ASML litho machines are a single step in even just the wafer production process, there are several companies involved in making and processing masks, doing the etching, cleaning solutions, etc.
As many industries, it's a highly globalized supply chain, with many companies distributed around the world specializing and leading different aspects. And yes, several of them are in the EU.
As to why the governments would do this, well it's geopolitics. The EU has some big players in the industry, but other parts of the supply chain are elsewhere. When all big geopolitical powers are interdependent, then no player will move to block another off at risk of hurting themselves. Now, both China and the US are shoveling billions into developing a higher independence (even before the trade war). Likely, the EU feels it is now forced to follow suit, or risk having e.g. the access to high-volume fabs to be a bargaining chip in future trade negotiations.
Aside from that I'd expected chip designers like ARM (+licensees), Bull Atos (would you call that an OEM?) and related software companies to take part in this.
Yes, there are. One of our project partners (in a different EU project) has a fab for large structures. I don't know what I can legally share beyond that, and also don't want to put wrong info here since I don't know the hardware details well enough (did software work higher up the stack and only have to care for the ISA) ;)
And these three are only the largest pure-semiconductor companies. There are many dozens of smaller companies and quite some fabs. A lot of automotive electronics is done by European companies. Also, many international semiconductor companies have development sites in Europe.
STM was originally Italo-French; it is a public company these days, whose headquartier is in Switzerland (as a neutral territory I guess), but the major shareholder (which is incorporated in Nederland) is still jointly owned directly by the Italian and French governments, and major production and reasearch sites are still in these countries. So, it is complicated
As someone who worked in HPC Projects in the EU, I'd say the vast majority of the grants is wasted. E.g. on
- obscure software and programming paradigms/libraries
- one-off's
- projects that create only reports, papers and recommendations
- endless recreations of the same software over the years and decades
- plain dumb projects
- attempts at recreating other people's software (e.g. U.S.)
There is also a large amount of overlap in work/content between projects, and lots of time is appropriated for unrelated work e.g. employees working on their PhDs.
On the other hand the industry takes a lot more money and plays similar games.
Project partners do not take the right path, because it's not conducive to fulfilling a grant, getting the next grant or increasing your citation count. The incentives are wrong.
EU’s decreasing GDP share in the world shows that EU is wasting lots of money by trying to pick winners. Just having low tax for small tech companies like in Shanghai would incentivize people to work on new great ideas, but I don’t see it happening.
The EU spends less time picking winners than countries did back in the pre-EU days. If you take that evidence at face value, it suggests that the EU isn't trying to pick enough winners.
Technology is always pushed by states, not small companies. Small companies can figure out how to market and reduce costs, but have never successfully created new, advanced technology.
No, that's a great example of what I'm saying. The vaccine is payed for by states - they had a 100% guaranteed worldwide market. Whether they invested their own money (like BioNTech) or were explicitly financed by a state (like Moderna and Pfizer), the money for that research will ultimately be payed almost entirely by the state.
Guaranteed wealthy clients are equivalent to investors. They're actually better, because you don't have to pay them back.
One of the main ways that states fund technological advances is exactly by promising to buy the results. This was one of the most important things in early IT - the fact that the US army was buying it at all. If the companies in that space would have had to live by selling their tech on the free market, no one would have been crazy enough to invest in it.
Guaranteed wealthy clients and investors exist in free markets too. That doesn’t make them Tech creators, that merit is still reserved to the startup itself.
Both Moderna and BioNTech were funded and working on the mRNA technology before governments came with large orders for the vaccines.
If you have guaranteed clients, you're not selling on a free market. This is one of the reasons why you can't have have (healthy) free markets in medicine in general.
And yes, while BioNTech and Moderna had been investing in mRNA before this, governments had been investing in mRNA research for many years. BioNTech itself has received significant investments from the EU, at least since 2019.
States are making monopolies with their militaries. I don't need a state to buy the vaccine, actually I signed up for a private vaccination, and I would pay significantly more than the states, but states are given priority because of their power.
That's irrelevant, because whoever you are, you have much less money than the US and the EU and the UK and [...].
Not to mention, there is no way to take this vaccine without specialized medical care, so even if people could buy it, they would still need medical care as well, which most people in most of the world get from the state anyway.
I can't decide if this is comical or depressing. The EU realizes they need to own the ability to manufacture processors. Meanwhile here in the US we've got hedge fund managers trying to gut Intel, national security be damned:
I always find these discussion around the business of chip production interesting and since there's always many knowledgeable people on these I wanted to ask if anyone has a good recommendations for books on the business of chip production?
Such a tiresome and self-defeating mindset. If the EU does nothing it's useless, if it does something it's just corruption.
Of course politics and lobbying will play a role when we're talking about hundreds of billions of euros, but that doesn't mean that it can't end up being a net positive for the union.
Ask for transparency and keep tabs, don't assume that it's already lost.
Can you name examples of EU initiatives on that level that delivered the desired results?
EDIT: I am asking because I seriously want to know. I haven’t made up my mind yet what to think about the whole thing. I am not familiar with successful EU initiatives. I’m open in believing this can work if there were successful examples in the past.
> I am not familiar with successful EU initiative.
The EU Cohesion Fund is one. Since 2007, ~133 billion € got invested in the poorer countries of the EU to improve trans-european traffic infrastructure (TEN, aka road, rail, waterways) and environmental projects (e.g. villages hooked up to proper sewage pipes with treatment plants at the end, instead of dumping sewage to the groundwater / into rivers and seas).
Even if that’s true (which I wouldn’t know), I don’t see how that can be sufficient to declare a project that aims to improve things a failure.
Let’s assume that project was for the poorest 10% of the EU. That would be 44 million people. €133 billion divided by 44 million is about €3000 per inhabitant.
I don’t think one can expect such an amount to bring roads, rails, bridges, and sewage treatment systems up to standards of the richest parts of the EU.
I don’t know how much the EU spent, but over here EU money payed for a frankly crazy amount of fiber optic cable. Completely common for a house far from any urban centre to have fiber internet.
That is the intentional result of Helmut Kohl's government many decades ago. Kohl wanted cable TV instead of fibre... because cable TV could be used to broadcast programs that were not "left mainstream". Wish I was joking, private TV stations in Germany are a thing only because the state TV was too left (in reality: not right-wing enough) for the freshly appointed Conservative chancellor.
I've visited several small towns in Romania, and all plumbing was in good order. It's not like a country stuck in 15th century. Are you talking about 'villages' of like 5 people?
In Croatia, they did, just saw a big sign in the hood when I went there for a funeral in the summer (which is what actually inspired me to write this comment).
EU funds for improving infrastructure is the only money that actually is not mostly money down the drain. Unfortunately programmes that don’t have such concrete outcomes (like this one) are entirely different.
I think the Erasmus initiative is an outstanding EU programme, which helped collaboration between EU universities and to build a EU identity for young educated students. It's not an economic initiative per se, and it's hard to measure its effective results objectively, but I believe it's been an absolute net positive for the EU.
Airbus is the obvious one; successfully broke a foreign near-monopoly. TSMC would be playing the role of Boeing, here.
I'm not sure if this will work, but I do think that something needs to be done by _someone_, even if not Europe. TSMC having a global near-monopoly on high-end fab is obviously not long-term viable. That's a bad situation for _everyone_.
You mean that resource wasting shop, that is sending huge airplane parts all across Europe for political reasons? I don’t even want to start about the subsidies considered illegal by the wto...
Isn’t that the kind of outcome you would expect from such a monopoly (/duopoly)? Even if a company could be more efficient it would not make sense for them to try to compete
Almost any "federal government" branch in any national or transnational entity works that way. They still get results good enough to push technology forward by encouraging parallel private investments.
I mean the whole USA tech sector was basically bootstrapped by federal money/grants/investments given in no different way of what EU is doing right now.
And even earlier, in chemical and advanced manufacturing space - just how many of the well-known US companies started as small shops that got their hands on government grants during WWII?
Seems like we're missing some "proper" motivation/focus/constraints now like war on this scale can provide… not just the EU, but this kind of diktat-innovation is increasingly more present everywhere…
Probably goes hand in hand with the ever present bailout olympics for those deemed TBTF…
I used to believe the "proper motivation" - like winning the war - mattered. Then I read "War Is a Racket", a 1935 short book by US general Smedley Darlington Butler, which in many places argues that even during an active war, companies will happily steal and squander the war funding. So now I'm not sure how much you can expect from such motivation.
Probably it's best to assume that some amount of graft will always happen, just dump the money, and hope something good comes out of it...
Well i'm not sure gunboat diplomacy and banana/global policing wars provide sufficient motivation compared to total wars… can only steal and squander so much before your factories get bombed and supply chains crippled.
I would agree if only the money dumps stopped ending up going mostly in the same places… lol
> USA tech sector was basically bootstrapped by federal money/grants/investments given in no different way of what EU is doing right now
There are MANY different ways to channel money into business or non-profit R&D. I doubt you can ignore all the differences and declare that what the US and the EU do or did is the same.
I am not saying it doesn’t exist, but I am personally not aware of any similar multibillion declaration made by the US.
Reporting corruption only works if there's someone to report it to who has both the power and the political will to actually do something about it. That simply does not exist within the EU as an institution. I don't think it's possible to easily explain exactly what's wrong with the EU's accountability and anti-corruption structures; endless column inches have been spent on the problems, mostly in somewhat niche publications and read mainly by people deeply interested in EU politics. (Which may also be part of the problem. Even before Brexit, few cared, and the political polarization around Brexit has pushed the idea that the EU has structural problems outside the realm of mainstream discourse. Take a look at the comments in this HN discussion for example!)
To me it looks more like they're trying to get more technological independence. Right now they're at the mercy of the US and China in many areas and as the result are target to political pressure. Reducing one's dependency does not hurt.
the SURE are bonds, not grants, idk why are you putting these on the table, from the tax payer pov bonds are just temporary transfers, it's the grants that will 'disappear'
Covid requres just one vaccine and a bit of time and disrupts mostly businesses that produce just human powered entertainment (and health services which is the worst thing about it).
While making the whole new generation of most important machines and landing beyond current cutting edge seem like both pricey and worthwhile endeavor.
Why? Europe already produces EUV lithography machines, and while I'm not that familiar with the field, I'm pretty sure ASML and TSMC are already working on 2nm lithography.
now a consortium of runner ups not only hopes to catch up, but plans a parallel release of a new node size, while starting later, while starting with less know how.
I'd like to see more government investment into domestic industries, however I believe that the semiconductor manufacturing market is already heavily saturated. R&D is welcome but beyond ensuring independence from foreign manufacturing there are not that many benefits that you would expect from this example of government stimulus. This industry primarily hires high skilled workers but unless they also directly fund the education of those high skilled workers it's not going to result in less underemployment.
I mean come on, the existing semiconductor industry in the EU has found it's niche. It's already well developed. If there really was a shortage of domestic semiconductor products then these companies would have been able to make a killing with their local fabs because corona related shipping restrictions resulted in a lack of supply from foreign nations. They wouldn't need the government stimulus and stand on their own.
It would make more sense to use this government stimulus on reducing CO2 emissions because most nations do not have economic incentives for reducing CO2 emissions. With our current economic models environmentalism amounts to charity and charity is one thing the government is very good at. The reason why I bring up CO2 reductions is because they are inherently domestic. You cannot put CO2 or electricity on a container ship and move the problem to a different country. A lot of the work also involves simple manual labor which helps with the underemployment problem for low skilled workers.
Not to mention the current supply issues for gaming console chips and GPUs - unless it's a very temporary blip it looks like insufficient production of the most cutting edge chips & all that on top of the TSMC monopoly.
ASML is the world's largest photolithography systems manufacturer and the only one producing extreme ultraviolet lithography machines. These EUV scanners are expensive as hell. Last years model costs $120 million per piece and you need 10-15 of them for TSMC gigafactory.
TWINSCAN NXE:3400C (7 and 5 nm nodes, >170 wafers per hour) is probably the most expensive machine in the world.