Analyst firm states global chip shortage may turn into oversupply by 2023

From one extreme to another

While a global chip shortage is causing significant supply issues for all sorts of electronic devices, one analyst firm has said that the industry will potentially reach overcapacity by 2023.

International Data Corporation (IDC) has stated that despite the dire chip shortages this year, the industry will return to normal “by the middle of 2022” and potentially become over-saturated in 2023 (thanks, The Register).

The report states that although demand for semiconductors will continue, associated shortages should “continue easing” through the end of 2021 as “capacity additions accelerate”.


Foundries dedicated entirely to production of these chips have been allocated all through 2021 and almost 100 per cent of production capacity is being utilised. Although “front-end capacity remains tight”, IDC notes that “fabless suppliers are getting the production they need from their foundry partner”.

Front-end providers are apparently starting to meet demand already, though this does not mean an immediate solution to the shortage as “larger issues and shortages will remain in back-end manufacturing and materials”.

Semiconductor shortages have lead to significant knock-on shortages of current-gen gaming consoles, as well as graphics cards and even cars. While IDC has stated that the situation is improving, signs from the German GPU market suggest that graphics cards – which have been hit particularly hard by chip shortages – are going to become more expensive and even harder to find.

Last month, STMicro CEO Jean-Marc Chery said that while “things will improve in 2022 gradually”, normal product availability won’t return “before the first half of 2023”. Similarly, Toshiba has warned that shortages in gaming consoles will likely last until at least 2022, and in some cases even 2023.

In other news, EA has acquired Playdemic – the studio behind Golf Clash – for over £1billion, in a major cash deal. EA CEO Andrew Wilson stated that the acquisition “not only adds to the strength of our mobile teams globally, it also continues our expansion and investment in UK-based talent”.

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