The two hardest things to obtain this spring are coronavirus vaccine appointments and game consoles. After Microsoft launched their newest Xbox consoles in early November, followed shortly by Sony’s release of the PlayStation 5, the gaming industry struggled to meet demand amid a global semiconductor crisis. This shortage has upended the global manufacturing of everything from automobiles to game systems to smartphones. President Biden signed an executive order in February ordering a 100-day review of supply chains. In early April, he sat down with business executives at the White House to discuss a plan to bolster chip production and find ways to assist major manufacturers recover production capacity. Each quarter-sized silicone chip holds billions of transistors and is the operating brain in every electronically powered system. Without it, the technology we rely on in our day-to-day lives would cease to function.
The United States remains the leader in the semiconductor market but has faced several production challenges in recent years. Major producers in Europe and Asia have also suffered. According to the Semiconductor Industry Association, “Following record sales of $468.8 billion in 2018, the global market decreased by 12 percent in 2019, and the outlook for 2020 has been negatively affected by the COVID-19 pandemic.” The shortage began after the global pandemic hit because factory shutdowns delayed chip supply. Companies around the world suffered a significant blow to revenue due to decreased manufacturing during the pandemic. According to Sangho Park, associate professor of computer electronics and graphic technology at Central Connecticut State University, “There is a higher demand than usual. Many kinds of electronic devices share fundamental components. Like memory, memory is needed in every gadget.”
Along with businesses temporarily closing down, people’s habits changed as they were forced to stay inside for quarantine. Computer and internet screen time increased significantly due to online schooling and adults working from home. This led to an increase in recreational screen time as well. Many people sought new diversions to keep them occupied at home as a way to cope with drastic changes in everyday life and fight off boredom. According to a study published by Joseph Johnson, a research expert covering internet use, “As of June 2020, 62 percent of parents to U.S. teens aged 14 to 17 years stated that their kids were spending more than four hours per day on electronic devices since the start of the COVID-19 pandemic. Only 32 percent of responding parents stated that their teens had used electronic devices daily for more than four hours before the COVID-19 pandemic.”
By the end of 2020, gamers were excited about the long-anticipated launch of the Xbox and PlayStation consoles. Days after the systems were released worldwide, many gamers were met with a sad reality: they might not get their hands on these devices for quite a while. Because such high demand was met with decreased supply, the gaming industry could not manufacture consoles to meet consumer demand.
“There is a higher demand than usual. Many kinds of electronic devices share fundamental components. Like memory, memory is needed in every gadget.”
The pandemic is not the only reason for the chip shortage. Everything from natural disasters to freak accidents to constraints in the global transportation system have been major factors in semiconductor production delays. “Several global locations had different kinds of problems that all summed up to this semiconductor shortage,” says Park. For example, the 2021 Texas power crisis forced a Samsung factory to halt production completely. In February 2021, an earthquake in Japan caused factory output to fall significantly. In March 2021, a factory fire in Taiwan completely damaged equipment needed for production. In addition to a halt in production, it takes a significant amount of time to produce a single chip. “Usually, the semiconductor production process requires fine control of the products in process. Once this is stopped, it takes several months at least to restart,” Park explained.
Carmakers, phone companies, and gaming producers are suffering an immense blow due to decreased production. Sony released a statement to consumers explaining, “We have not been able to fully meet the high level of demand from customers [but] we continue to do everything in our power to ship as many units as possible to customers who are waiting for a PS5.” Consumers around the country have expressed frustration with their inability to purchase the new gaming devices. “They’re like gold right now. It took me four months to successfully order a PlayStation 5. I would find one available, and in the time it took me to fill out my payment info, it was gone. I’m one of the lucky ones, though. Most of my friends are still trying,” says Turner Rodman, twenty-three, whose first game console was the PlayStation 2 in 2000.
The increased popularity of console scalping has made it even harder for regular gamers to get their hands on the systems. According to writer and gamer Sohame De, “Scalpers are people that buy up an item, limiting or removing its stock from retailers, and then resell it at extortionate prices. Though this isn’t a new phenomenon, the launch of the Playstation 5 and Xbox Series X has brought significant notoriety to people who practice scalping.” Data engineer Michael Driscoll estimates that scalpers have made an overall profit of $43.2 million from resale of PlayStation 5 consoles alone. As if the inability to produce enough game systems wasn’t challenging enough already for manufacturers, the rising surge of scalpers in recent months poses another threat to their efforts to satisfy consumers.
As the US economy rebounds and consumer spending increases, the technology companies continue to struggle with delayed production. It is difficult to tell for sure when production will be back to normal. President Biden’s attention to the crisis shows that real effort is being taken to combat the devastating chip shortage to US manufacturing. But there are limits to his influence. In early April, White House press secretary Jen Psaki told reporters, “This isn’t a meeting [that] we expect a decision or an announcement to come out of, but a part of our ongoing engagement and discussion about how to best address this issue over the long term, but also over the short term.” The problems that threaten the current state of the tech industry can only be solved with time. Let’s hope it’s not being kept on a digital clock.
Julia Rodman is a staff writer for the Blue Muse Magazine
Header Photo Credit: Pixabay.com