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The old saying of 'It never rains but it pours' couldn't be more apt when it comes to describing the current state of computer manufacturing. Alongside shortages of DRAM, NAND flash, processors, and copper, it turns out that there is yet another vital component that's in high demand, short supply, and with significant price hikes.
It's a very simple little thing called an MLCC (multilayer ceramic capacitor), and if you grab any CPU, graphics card, or motherboard, you'll see hundreds of them all over the place. They're used for various kinds of roles, but in these instances, they're implemented as part of voltage control and noise filtering, and according to a report by DigiTimes, the supply of them is being significantly affected by—you guessed it—AI.
Taiwan-based Holy Stone is a supplier of multilayer ceramic capacitors, and its chairman, Bill Tang, recently told investors that the situation is so tight that it's taking more than 20 weeks for products to be shipped out after receiving an order, and that this is likely to get even worse over the remainder of this and next year. That's even with output expansions of up to 30% and 40% across the next two financial years.
Thousands of MLCCs are required for just a single AI server board (up to ten times more than a standard server), let alone the power supply units to operate a whole rack of them, and just as with memory, the demand for the tiny capacitors is so big that the industry as a whole has been struggling to keep up.
The world's largest manufacturer of MLCCs, Murata Manufacturing, increased prices by 15% to 35% last month, because of it all. However, while it might seem like it's yet another nail in the coffin that is being a PC enthusiast, the AI industry only needs very specific types of MLCCs, and these aren't necessarily used for common or garden PC components. Or if they are, they're not required in any great quantity.
That said, neither is HBM (high bandwidth memory), but the rampant demand for that is so high that memory manufacturers are favouring that stuff over the production of standard DRAM, which is why it's all so ridiculously expensive right now. With the level of investment in AI servers showing no signs of slowing down, it wouldn't be a surprise if the MLCC industry altered its production lines to chase after the money.
Anyone who's been a PC gamer for many years will know that the industry as a whole has gone through many cycles of component shortages and price hikes (cryptomining and Covid being the most recent). At their worst times, it felt like things would never return to normal, and it sure feels that way with AI.
How long we'll have to wait for the light at the end of the tunnel is anyone's guess, but with another component shortage to deal with, it looks like the smelly ol' sewer is going to keep stretching on for a good while yet.
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