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Computer chip sanctions against Russia

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Avatar for Geri
Written by   99
1 month ago

Last year i already have written an article about the situation in Ukraine. I thought there will be no point to discuss this issue further, but i have decided to write a small analyzis on the chip sanctions against Russia. These sanctions and the effects of these sanctions are not properly discussed in the international media, because the western world doesn't really understands the market of the East.

In this article, first i will explain the user behavior of a typical Russian end-user, and then i will list the sanctions, and explain, why and how they will (not) be effective in the intended way. In this article, i will not discuss the military situation itself, or the situation in Ukraine in any ways, so don't expect me to write an analyzis about that.

Typical Russian user before the conflict

For content consuming and casual gaming, a typical Russian geek uses a Core2Duo or an Athlon64 x2 based computer. These chips and motherboards were made about 15 years ago. Even a lot of westerners still use these older computers. This is possible, because the hardware development slowed down, and stalled more for a decade ago. After the first dual core and quad-core processors were made, the computers barely got faster. Some software became more bloated, however, the majority of essential software will work properly even on old computers.

What computer a typical Russian household uses

A typical Russian geek uses a dual-core desktop computer with 2 or 4 GByte of memory. This is enough to run all of the software required for watching movies, listening to music, using office-type software, browsing the internet, or writing programs.

Typical Russian users have cheap laptops with dual core processors as well, with 2 or 4 GByte of memory. The same usability applies for these as well.

A typical Russian (or any East European) user uses cheap chinese smart phones with two cores, such as Xiaomi or Huawei. This is enough to make calls, make pictures and videos in 720p or sometimes even in full HD, run navigation software, and run third party software and games on them.

Russians typically buy these second-hand. Of course there is always a rich elite in everywhere, who orders them brand new. There are hardcore gamers, who will buy the latest video cards and processors - no matter what. The wide market is however, different. Statistics of Intel and AMD shows, that Russia only bought 0.5% of chips and IT devices brand new in the previous years. The logical explanation of this is clear: they rarely upgrade their hardware, and if they do, they just buy something cheap, second hand.

Typical Russian corporations

A 20 years old computer can act as a mail or web server without too much issues, when its configured properly. A 20 year old computer can run an ERP system, can control CNC machines, manufacturing appliances, or allows office-type of usage without any problems. Realistically speaking, there are only very few companies who need high-performance servers and computing power - such as banks, cloud service providers. Even so, high-polygon modeling, SQL database implementations, network routing, and other formerly high-demanding tasks are running fine on decade old computers if they are configured properly.

Russians barely upgrade computers

As we can see, in reality there are no scenarios, where a $2 second hand Core2Duo or Athlon64 x2 chip from 2006 can not perform perfectly in any real world task. The real draw-back of these chips are the power consumption, as they consume 45-120W to reach the performance of modern 6W-15W chips. And of course, gamers will be sad, as these chips lack a few instruction set extensions required to start up some newer video games.

Russian chips

Russia not just blindly buys chips from external sources, it also designs its very own hardware. Russia has two major chip design companies, and two factories to produce them. The factories are producing 90nm chips. One is for memory, and the another one is designed for processors. The capacity of these plants together are around 1 million chips per year. They producing chips for military, government and civil usage as well.

Elbrus

Elbrus designs 64 bit x86 processors, scaling from 300 MHz to 2 GHz. Elbrus designs are interally using a VLIW instruction set, which is different from the western RISC-style internals. Western processors - such as Intel and AMD - building RISC-based cores. RISC processors using simplified instruction sets (internally). They translating x86 bytecode to these internal instructions to execute standard programs compiled as x86 binaries.

The Russian approach differs from this. The VLIW processors internally executing large, bucketed instruction buffers, and the contects of these buckets are executed parallelly. The VLIW approach died out on the west (for example Intel Itanium, Transmeta company), but for some reason, Russian state kept the conception alive for their chips.

Baikal

Baikal is another Russian chip company, producing MIPS and ARM chips. Unlike the x86 architecture, MIPS and ARM can be licensed from the license holders, so companies can build their own processors using these chips. ARM is a British CPU design company, which is currently owned by Japanese investors. MIPS is currently owned by China. Manufacturers of ARM and MIPS chips usually manufacturing unmodified chips based on the IP they license, meanwhile x86 chip manufacturers creating their own designs from ground-up.

source: Baikal Electronics

The first wave of sanctions

Most of the sanctions against Russia (i would say 99% of them) can be considered a joke. Exiting fast-food chains and closing luxury latex-glove shops will not stop the Russian army. The sanctions on banking and bank transfers are far more serious, but the sanctions in the IT field can be considered a far more serious threat, as these can have an impact of the Russian economy or on the russian arms manufacturing as a whole.

Intel and AMD stops selling chips

The American government forced Intel and AMD to stop selling chips to Russia. The answer of Russia was simply legalizing grey-import of hardware. The previously mentioned few-dollar worth of dual-core machines, which are being used by the overwhelming majority of Russians, already arriving in the form of second-hand trade. This is simply beyond the scope and the control of the sales of AMD and Intel, as qute a few dozens of them simply fits in the backseat of a tourist, and then he spent less on it than on his dinner. This can only hinder the market of high-end servers and HEDT, but there are no real danger in it for the Russian economy or the military as a whole. Its important to note, there are Chinese desktop computer chip manufacturers as well, such as Zhaoxin (which makes 4-8 core x86.64 chips at 1.1 to 3 GHz) which can be bought brand new in Russia.

Sanctions by TSMC

The Taiwanese TSMC company has the most modern chip manufacturing plants on the world. TSMC manufactures chips on 14, 7, 5 and 3nm manufacturing lines, makes the processors and graphics chips for AMD, nVidia, Apple, Qualcomm and for hundreds of other companies worldwide. They also manufactured the newer 8 core chips for the Russian Elbrus processor company. After TSMC stopped the contracts with Russian companies, Elbrus can't access modern manufacturing lines beyond the old Russian 90 fabs.

Chip manufacturing lines in Russia

The two Russian chip manufacturing company produces memory chips, and dual core 32 and 64 bit processors. Those processors are being used in rockets for the military, anti-air systems, submarines. Obviously losing the ability to manufacture the 8 core Elbrus8C chip is a loss for Russia, but it is not going to cripple the economy or the military in any ways.

Internet devices, routers, modems

The previously mentioned manufacturing lines are building the dual core Elbrus2C chip not just for the military, but also for civil usage. Various manufacturers introduced sanctions against selling routers, cable modems, and other communication hardware to Russia. As Russia is already capable of manufacturing its own memory chips, routers, internet modems, network switches based on their old Elbrus 2C chip which they can manufacture in Russia, there is absolutely no danger for Russia due to these sanctions. The western companies losing more on this than Russia itself.

Banning Russian users and companies from Github, Youtube, Netflix, american online video sites

First of all, i have no clue what Netflix is (besides the fact its some online movie rental service), so i don't think a lot of people know it in the region. Banning certain Russian persons and companies from sending patches to American and western projects (!!!) doesn't sounds like something that would hurt Russia in any way. If it hurts something, then those are the western opensource projects which will lose a lot of masterminds. At this point of the sanctions, these companies clearly lost their connections with reality (for example, thinking the world revolves around their online tv channel). These moves are also PR disasters for them. They don't just fail to hinder the Russian economy, but giving up market share for new Russian platforms to arise for free.

Banning Russian companies from using ARM licenses

No further loss for the Russian IT economy, as they already got stripped from western CPU fabs. This could be problem for a Russian company, if it is about to manufacture an ARM based processor elsewhere. State-owned chinese factories, however, already expressed their will to manufacture chips for russian orders. Such as the state owned chinese SMIC, which has 14nm manufacturing lines, and manufactures processors for Huawei/Hisilicon, which is a company that also got stripped from ARM license.

Summary

The Russian army will not stop because they don't have Netflix. Russian people will not go out to overthrow the regime just because they only have dual core computers. The few 10000 Russian hardcore gamer will not organize a coup-detat just because they have to use old video cards. The sanctions hurts for Russia. Just like when someone uses a slingshot to shoot chesnuts to a bear. The impact will hurt, but it will not injure the bear. It will make the bear more angry. West Europeans and Americans don't understand it just yet: the bear is not a toy.

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Avatar for Geri
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1 month ago
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Comments

Excellent description explaining what I am facing now. My aging laptop needs replacing so I am looking. What the local market here inside an old USSR satellite matches well what you described: Ancient laptops with chips almost a decade old predominate. On investigation I see the old chips in these machines are still very well suited for normal tasks. I am considering buying an ancient (9year old) behemoth that still outclasses my (10year old laptop) by an order of magnitude. Thanks for clarifying what we face in navigating the techmarkets here inside what was once described as being behind an "iron curtain".

$ 0.01
2 weeks ago

Excellent article @Geri. Don't mind about the negative comments. The commentor is using ad-hominem attacks and I much prefer your analysis over his comments "elect a dictator and warmonger like Putin." Phrases like this shows that he doesn't understand much and as you say, falls for the propaganda.

I think you wrote it super well, focusing on the technology. Your articles always show a lot of research and I respect that. Also I agree with you 100%. Those sanctions hurt but will not cause "real" damage. And the world is changing. Russia will survive without Western technology.

$ 0.01
2 weeks ago

Thankyou. Its very hard to stay unbiased in situations like this.

$ 0.00
2 weeks ago

The fact that you haven't heard of Netflix only shows your ignorance. Netflix has subscribers all over the world, including in Hungary.

https://www.comparitech.com/tv-streaming/netflix-subscribers/

In Russia it was almost 200k.

Btw, the Russians will be able to live without Netflix, the Russian economy without Western technology will not. The Russian chips are a joke compared to Intel and AMD.

$ 0.00
1 month ago

I think your comment shows the true reason why russia can occupy more and more land all over the world from the netflix-type people.

Because the true ignorance is when you don't have a life, and you are addicted to a tv service on your smart tv which people end up registering into, and thinking its some kind of new global paradigm just because you are unable to view the world from the perspective of other people.

If - instead of trying to throw tantrums - you would have read the data you personally have linked, you would have noticed that the revenues of this service (not just in russia, but in hungary as well) are insignificantly small to the extent it probably couldn't even enough to pay a local datacenter to store and pay the bandwidth of the streaming. A company like this would have a hard time to even feed a sockpuppet from this.

Sad to see that even a smart person, like you, gets manipulated into the war propaganda - of other states, not even your own state - against your own interest, and thinking the bombs will magically stop falling because people in russia will not able to play a video game in 4k, but maybe its not the russian technology which is a joke, and they will take peaces of your country as well.

$ 0.01
1 month ago

Russians are a smart and hardy people. They have a long history of surviving stuff and inventing their own, especially during Soviet times.

In fact, I hope they'll create an alternative to all the unreliable Western trash.

$ 0.02
1 month ago

If the Russians were a smart and hardy people, they would not elect a dictator and warmonger like Putin.

$ 0.00
1 month ago
  1. Putin is neither a dictator nor a warmonger. He's a democratically elected leader who is standing up for his country's interests.
  2. And even if he was both of those things, by "Russians are smart and hardy" I meant them being a people that can survive and invent themselves through harsh adversities.
$ 0.02
1 month ago
  1. Putin is neither a dictator nor a warmonger. He's a democratically elected leader who is standing up for his country's interests.

So was Hitler. By the way, they are not the interests of his country. They are Putins interests. A country has no interests at all. A country has forests, fields, mountains, rivers and lakes.

2 And even if he was both of those things, by "Russians are smart and hardy" I meant them being a people that can survive and invent themselves through harsh adversities.

Only the future will tell. I am very sceptical about Russia's future. Hitler led Germany to its downfall. I fear that Putin will do the same with Russia. Both are blinded by power and both are megalomaniacs.

But at some point, after the collapse of Putin's Russia, the Russians will certainly will survive in another, probably much smaller country.

$ 0.00
1 month ago

They are Putins interest

Tell that to the Russians living in the Donbass or Crimea. They were persecuted by the Ukrainian government, so Russia decided to step in. I wish that my Hungary did the same for the persecuted Hungarians of Transcarpathia.

But at some point, after the collapse of Putin's Russia, the Russians will certainly will survive in another, probably much smaller country.

Keep on dreaming, buddy. Keep on consuming the copium. I'm sure Putin will spontaneously die if you keep repeating the mantra long enough and loud enough.

$ 0.01
1 month ago

so Russia decided to step in

Not Russia, Putin decided. Putin is not Russia, Putin is Russias greatest enemy. Putin is not only persecuting Ukrainians, Putin is also persecuting Russians. At some point, Russians will understand, just as Germans have understood that Hitler was Germany's greatest enemy. West Germany was lucky after the Second World War that the USA helped to rebuilt it. Russia will not be so lucky. Russia is a poor country. Before the war, Russia's economy was as big as South Korea's, yet South Korea has only a third of Russia's population. Russia will become a third world country after the war and will become China's vassal state. Russia will become (cheap) labour and raw material supplier for China and becomes totally dependent on China. Anyone with some knowledge of economics and history can see that. I am sorry to write this, but remember in a few years what I have written.

By the way, the Russian leadership has a lot of experience in deploying its army in foreign countries, such as in your Hungary in 1956. If I were you, I would not be happy if Russia annexed Ukraine and there were Russian soldiers on the Hungarian border again.

$ 0.00
1 month ago

Really well said. Is Putin perfect? No, absolutely not. But no world leader is perfect. And in my eyes, he is above many current world leaders. He is standing up proudly for his people and his people love him for that. I watched all of the Putin interviews made by Oliver Stone. Two brilliant mans having a discussion. It's worth watching.

$ 0.00
2 weeks ago

He is standing up proudly for his people and his people love him for that.

It was the same with Hitler.

$ 0.00
1 week ago