Summary

• In commentary provided to the U.S. Department of Commerce, Infineon suggested that the semiconductor industry should create a platform for anonymous sharing of demand data.
• This is, of course, something Palantir specializes in. Palantir has already built robust capabilities for both the handling of complex supply chain data and the sharing of sensitive data.
• This suggestion matches a broader U.S. Government objective to drive greater collaboration in the semiconductor industry. Such a platform could be an important first step.
• We are going to jump in at an intermediate level here.

It's no secret at this point that a shortage of semiconductors, chips that make up the central nervous system of the modern economy, has created a minor crisis. In the auto industry alone, the effects of this shortage have ranged from BMW pulling features from cars to Ford halting production on certain models. Any gaming enthusiast who has tried to purchase a graphics card from Nvidia (NVDA) in the last year understands their pain.

This crisis has been exacerbated by the fact that Intel (INTC), which once unequivocally dominated the industry with the help of Microsoft (MSFT), has fallen significantly behind TSMC (NYSE:TSM) and Samsung (OTC:SSNLF) in semiconductor manufacturing technology. This has created a new competitive dynamic where Intel's competitors are able to leverage this manufacturing technology, leveling the industry playing fall.

The result has been a disaster for Intel, but a windfall for TSMC and customers such as Nvidia, Apple (AAPL), and AMD (AMD). Taiwan's TSMC is now the world's 8th most valuable publicly traded company, trailing just behind Nvidia. Apple is #1. As this symbiotic relationship between manufacturer and designer strengthens, the resulting more powerful chips increase demand as new capabilities become within reach, further compounding the problems.