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2 Top Tech Stocks to Buy During a Recession – The Motley Fool

Just about every company feels the impact of a recession, or slowdown in the economy, in some way. They can plan for it, but they can't avoid it. Similarly, it's not realistic to structure your stock portfolio to avoid all losses during a bear market. Even Warren Buffett's portfolio takes a hit in some way when a bear market comes along. The best you can do is adopt a long-term attitude toward the investments you make.

For long-term investors, what's more important than stock performance is the performance of the underlying business. A business that can still grow revenue in a tough economy is obviously one you should want to invest in for the long term. It will likely perform that much better in a booming economy and generate market-beating returns, even in a bull market.

Here are two tech stocks you might want to consider buying if the stock market falls over a recession.

Owning shares of businesses that generate recurring, year-round revenue from subscription services is ideal in a recession. It's even better when you invest in a subscription-based business that is delivering high growth in annual revenue. This is why investors looking for a top tech stock to hold in an uncertain economy should consider CrowdStrike (CRWD -2.13%), a leader in cybersecurity software.

Despite all the disruptions the economy faced over the last few years with inflation, supply chain bottlenecks, and rising interest rates, CrowdStrike grew revenue from $481 billion in fiscal 2020 to $2.2 billion through fiscal 2023. Cybersecurity is a must-have, especially as organizations migrate their data systems to cloud servers. Cloud computing brings a lot of efficiencies for companies, but the downside is it exposes company data to cyber-attacks. This growing threat is driving demand for cybersecurity solutions.

CrowdStrike is becoming the go-to choice in this market. Its cloud-based Falcon platform uses artificial intelligence (AI) to protect against threats across endpoint devices, cloud workloads, and data. It posted a 37% year-over-year increase in revenue last quarter. Management is landing large deals with major organizations across financial services, technology, retail, and manufacturing. Wall Street analysts expect full-year revenue to grow 35% to $3.04 billion, consistent with company guidance.

The stock price has climbed 67% year to date, but it's not too late for investors to jump on board. CrowdStrike is seeing an expanding growth opportunity as it launches new services on its platform. Management sees its addressable market being worth $158 billion by 2026, so the company should be able to grow at high rates for several more years and fuel market-beating gains for investors.

Microsoft (MSFT -3.75%) has changed a lot over the last decade. It no longer depends on selling individual software products for every device its customers use. It now sells its flagship Office software, and many other services for consumers and businesses, as a subscription. The strength of the Microsoft brand and subscription-based business strategy make the stock a solid investment for any economic environment.

High-margin revenue streams from software services have made Microsoft a financial fortress. Over the last 10 years, it grew revenue and earnings per share at 10% and 14% per year, respectively. On a trailing 12-month basis, Microsoft generated a whopping $59 billion of annual free cash flow on $211 billion in revenue, and it should continue to grow. The ongoing shift from licensed product sales to subscriptions appears to still have legs for long-term growth, as it drove a 13% year-over-year increase in revenue for Office 365 last year.

Microsoft is also continuing to post strong growth across its offering of commercial cloud services, with Microsoft Azure ranking as the second-largest provider behind Amazon Web Services. Microsoft Cloud revenue grew 22% last year to $111 billion, comprising most of its total revenue.

Solid growth prospects in productivity software and cloud services have pushed the stock price up 37% this year, but Microsoft is using its cash resources to further widen its advantage. Following its investments in ChatGPT creator OpenAI, Microsoft has started to introduce new AI tools across its software offerings, which should lead to more growth and ultimately benefit the stock for years to come.

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. John Ballard has positions in Amazon.com. The Motley Fool has positions in and recommends Amazon.com, CrowdStrike, and Microsoft. The Motley Fool has a disclosure policy.

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Everything New in iOS 17.2 – Lifehacker

You may have just updated your iPhone to iOS 17.1, but Apples already hard at work the next big iOS update. The company is currently beta testing iOS 17.2, which might just offer the biggest changes since...well, iOS 17.0.

Heres whats new:

One headliner this time around is Journal, Apples first-party journaling app. The company announced Journal during its WWDC iOS 17 presentation, but it didnt make the final cut for iOS 17.0 or iOS 17.1.

Apple differentiates Journal from other similar apps by intelligently pulling from things you did on your iPhone that day to create entires. For example, Journal takes photos you snapped, places you visited, music you listened to, and workouts you did, and automatically adds those to generate a journal entry. From there, you can journal away, either with Apples prompts, or with whatever you want to write.

The new update also brings iMessage Contact Key Verification to the iPhone. Apple previously teased this feature too. For those who face extraordinary digital threats (think journalists and politicians who are hacking targets), this feature confirms whether the person theyre iMessaging is really who they say they are. If your iPhone detects an unrecognized device has breached the cloud servers and infiltrated your conversation, youll receive an alert. Theres even a code you can use to confirm the other persons identity.

Those updating to iOS 17.2 will find two key playlist features in Music. Now, you can collaborate with others on playlists, so a group of you running iOS 17.2 can all contribute to the list of songs, including what order they play in. In addition, iOS 17.1's Favorites, which replaces the useless Love function, are now added to a new Favorites playlist. It finally makes revisiting the songs you marked as a favorite easy.

The new update now gives you the option to disable Apple Music listening history for any given Focus. So, if youre listening to ambient music while you have a Work Focus enabled but you dont want it added to your history, none of that playback will be recorded to your account.

Your iPhone 15 Pros Action Button is cool, and can be used in a host of different ways. Now, you can add translation to that list: If you choose the Translate option in iOS 17.2, you can use the Action Button to quickly pull up the Translate app.

This ones another delayed iOS 17 feature: In addition to the usual Tapback reactions you can use, iOS 17.2 lets you react with either an emoji or a sticker. And, since iOS 17 lets you turn just about anything into a sticker, you can react to messages with just about anything.

You now have three new Weather widget options to choose from: Details, Daily Forecast, and Sunrise & Sunset. Theres also now a digital clock widget.

There are also a couple of smaller features Apple added to iOS 17.2. You now have a rainbow text option when making a Contact Poster, and Apple Books has a new Fast Fade feature when turning pages.

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China rushes to swap Western tech with domestic options as U.S. … – Reuters

BEIJING, Oct 26 (Reuters) - China has stepped up spending to replace Western-made technology with domestic alternatives as Washington tightens curbs on high-tech exports to its rival, according to government tenders, research documents and four people familiar with the matter.

Reuters is reporting for the first time details of tenders from the government, military and state-linked entities, which show an acceleration in domestic substitution since last year.

China has spent heavily on replacing computer equipment, and the telecom and financial sectors are probably the next target, said two people familiar with the industries. State-backed researchers also identified digital payments as particularly vulnerable to possible Western hacking, according to a review of their work, making a push to indigenize such technology likely.

The number of tenders from state-owned enterprises (SOEs), government and military bodies to nationalize equipment doubled to 235 from 119 in the 12 months after September 2022, according to a finance ministry database seen by Reuters.

In the same period, the value of awarded projects listed on the database totaled 156.9 million yuan, or more than triple the previous year.

While the database represents only a fraction of tender bids nationwide, it is the largest collection of state tenders publicly available and mirrors third-party data. China spent 1.4 trillion yuan ($191 billion) replacing foreign hardware and software in 2022, marking a year-on-year increase of 16.2%, according to IT research firm First New Voice.

But Beijing's lack of advanced chip-manufacturing capabilities prevents it from completely substituting products with alternatives that are entirely locally made, analysts say.

Previous domestic substitution efforts stalled because China did not have the "technical chops to pull off localization until now, and to a certain extent they still kind of don't," said Kendra Schaefer, head of tech policy research at Beijing-based consultancy Trivium China.

SOEs were instructed last year to replace office software systems with domestic products by 2027, the first time such specific deadlines were imposed, according to five brokerage firms that cited a September 2022 order from China's state asset regulator. Reuters could not independently verify the order.

Domestic replacement projects this year have targeted markedly sensitive infrastructure, the tenders show.

One partially redacted tender for a "certain government department in Gansu province" assigned 4.4 million yuan to replace an intelligence-gathering system's equipment, without providing specifics.

People's Liberation Army units in the northeastern city of Harbin and Xiamen in the south last December meanwhile issued tenders to replace foreign-made computers.

Tech researchers such as Mo Jianlei of the Chinese Academy of Sciences, the country's largest state-run research organization, said the Chinese government was increasingly concerned about Western equipment being hacked by foreign powers.

The state asset regulator did not return a request for comment.

Over the past year, state-linked researchers also called on Beijing to strengthen anti-hacking defences in its financial infrastructure due to geopolitical concerns.

One March research paper highlighted the dependence of China's UnionPay credit card system on U.S software firm BMC for settlements.

"Beware of security vulnerabilities in hardware and software set by the U.S. side ... build a financial security 'firewall'," the researchers wrote.

BMC declined to comment.

An article published this year in the journal Cyberspace Security by researchers from the state-run China Telecommunications Corporation concluded the country was overdependent on chips made by U.S. giant Qualcomm (QCOM.O) for back-end management, as well as on the iOS and Android systems.

"(They) are all firmly controlled by American companies," the researchers wrote.

As China has not signed World Trade Organization clauses governing public procurement, the substitution effort does not appear to violate international accords, according to the U.S. Treasury. The U.S. has implemented similar rules barring Chinese companies from public sector bids.

Qualcomm, Google (GOOGL.O) and Apple (AAPL.O) did not immediately return requests for comment.

China's effort to build an independent computing system dates back to at least its 2006 five-year plan for science and technology development, which listed the semiconductor and software systems sectors as national priorities.

This effort spawned state-owned companies that are increasingly winning major contracts. Two firms awarded the Harbin tenders were subsidiaries of China Electronics Corporation and China Electronics Technology Group Corporation - both heavily targeted by U.S. sanctions.

The state regulator's 2022 order pushed SOEs away from U.S. companies such as Microsoft (MSFT.O) and Adobe (ADBE.O), according to an employee of a Beijing-based firm that develops domestic office-processing software

China Tobacco, for example, in July began switching some subsidiaries from Microsoft Windows to Huawei's EulerOS, according to an employee of a software vendor that services the state-owned manufacturer.

The people spoke on condition of anonymity because they were not authorized to discuss clients and competitors.

For years, Western tech companies have shared their source code and entered into partnerships with domestic firms to address Beijing's concerns, but prominent computer scientists such as Ni Guangnan of the Chinese Academy of Engineering have said such measures are not sufficient for China's security needs.

China Tobacco, Microsoft and Adobe did not respond to requests for comment.

In September, Reuters and other outlets reported that some employees of central government agencies were banned from using iPhones at work.

"In certain sectors, customers ... are opting for domestic suppliers, with foreign suppliers frequently facing informal barriers," the European Union Chamber of Commerce in Beijing said in response to Reuters questions.

In a 2023 American Chamber of Commerce (AmCham) in Shanghai report, 89% of the organization's tech business members named procurement practices favoring domestic competitors as a regulatory obstacle. It was the highest percentage of any sector.

AmCham Shanghai President Eric Zheng acknowledged China's national security concerns but said he hoped "normal procurement procedures will not be politicized so that US companies can compete fairly and pursue commercial opportunities ... to benefit both countries."

The U.S. Department of Commerce, China Electronics Corporation and China Electronics Technology Group Corporation did not return requests for comment.

Chinese tech conglomerate Huawei has emerged as the leading firm in this replacement cycle, according to three people familiar with China's enterprise tech industry, who spoke on condition of anonymity given the sensitivity of the issue.

In 2022, Huawei's enterprise business, which includes software and cloud computing operations, reported 133 billion yuan in sales, up 30% on the previous year.

One of the people said privately-held Huawei was seen as more nimble than state-owned groups in rolling out products and executing projects.

The other two sources highlighted Huawei's broad product suite - spanning chips to software - as an advantage.

Clients also prize Huawei for its ability to process data on internal company servers and external cloud networks, as well as its wide offering of cybersecurity products, according to the employee of a China Tobacco tech supplier.

Huawei declined to comment.

The replacement drive has re-drawn entire sub-sectors of the software industry. The combined China market share held by five major foreign makers of database management systems the majority of which are American - dropped from 57.3% in 2018 to 27.3% by the end of 2022, according to industry group IDC.

Despite heavy spending on domestic substitution, however, foreign firms are still dominant suppliers for banking and telecoms database management. Non-Chinese companies held 90% of market share for banking database systems at the end of 2022, according to EqualOcean, a tech consultancy.

Financial institutions are generally reluctant to switch database systems despite government pressure, said one of the industry sources, adding that they have higher stability requirements than many other sectors and local players cannot yet match their needs.

Even for personal computers, banks that switch from an international brand to China's dominant supplier Lenovo (0992.HK) would still be reliant on critical chip components provided by Western firms, one of the industry sources said.

($1 = 7.3165 Chinese yuan)

Reporting by Beijing newsroom; Editing by Brenda Goh and Katerina Ang

Our Standards: The Thomson Reuters Trust Principles.

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Securing Data Collection and Analysis at the Edge – Solutions Review

Solutions Reviews Contributed Content Series is a collection of contributed articles written by thought leaders in enterprise tech. In this feature, Rockwell Automations Albina Ortiz offers commentary on securing data collection and analysis at the edge.

Despite being around since the 1990s, manufacturers have only recently adopted edge computing, driven by the advance of digital transformation and the expansion of Internet of Things (IoT) device connectivity to enterprise networks. This dispersed computing model brings computation and data storage closer to the networks data source or edge (hence the name) rather than relying solely on centralized cloud servers. Its ability to bring storage and computation closer to machines and locations that need it is now proving its worth to C-level executives.

While edge computing offers numerous advantages, it also raises significant security concerns. Securing data collection and analysis at the edge is crucial in todays connected world, especially as more devices and sensors are deployed in remote or distributed environments and may be more vulnerable to physical attacks or unauthorized access. In this article, we will explore why edge computing is both a blessing and a challenge from a cybersecurity perspective, why securing a distributed network requires careful consideration, and how manufacturers can help protect themselves from breaches.

From a cybersecurity perspective, edge computing has many beneficial attributes for enterprises, including improved response time, bandwidth optimization, and decreased security concerns. Lets highlight some of the main benefits:

By moving security applications closer to the data and devices they are protecting, edge computing reduces latency, improving their performance and making it easier to detect and respond to threats in real time. Edge computing also reduces bandwidth utilization and brings data storage and processing closer to the user, delivering quicker response times than cloud computing and improving performance. By processing data closer to where its generated, applications can respond more quickly, making it ideal for real-time and latency-sensitive applications such as IoT devices, autonomous vehicles, high-quality live video streaming, and augmented reality (AR).

Edge computing helps improve the overall security posture by distributing security controls throughout the network, making it more difficult for attackers to gain a foothold and compromise the entire system. In addition, deploying real-time threat detection and response systems using edge computing can identify and block attacks before they reach central data centers. With data no longer being sent over long distances, edge computing aids in security enhancements, shielding sensitive data from potential cyber threats and reducing the risk of data breaches. Edge computing can also authenticate and authorize devices before they are allowed to connect to the network, helping prevent unauthorized devices from accessing sensitive data and systems.

Computing at the edge can help improve data privacy by reducing the amount of data that needs to be transmitted to central data centers and encrypting the data sent, making it more difficult for threat actors to steal or intercept sensitive data. Enhancing data privacy and security through edge computing keeps sensitive data localized, reducing the need to transmit it over public networks. This is crucial for industries like healthcare and finance, which handle sensitive information.

Edge computing can help reduce an organizations attack surface by offloading some processing and storage from central data centers. This can make it more difficult for attackers to find and exploit vulnerabilities.

Zero-trust security models implemented using edge computing further enhance overall security by verifying all users and devices identities and authorization before granting access to resources. This can help prevent attackers from gaining access to sensitive data and systems, even if they have compromised a users account or device.

The flip side of edge computing is that it introduces several security risks that enterprises must consider and address. These risks stem from edge networks distributed nature, edge devices diversity, and the potentially remote and less secure environments where these devices may be deployed. Lets take a close look at these challenges:

The nature of edge computing involves distributing devices and applications to the edge of the network, which can make them more challenging to secure and manage. The diverse range of devices, from simple sensors to powerful servers, can make it difficult to develop and implement effective and adequate security controls for all devices.

Achieving interoperability and maintaining data consistency across distributed edge nodes, devices, and platforms is also a challenge. Ensuring that all nodes have access to the most up-to-date information without introducing conflicts is complex, so making sure that different devices and protocols can work together seamlessly is an ongoing concern.

Edge devices typically have limited computational power, memory, and storage compared to cloud servers. This constraint can make it challenging to run resource-intensive applications, handle large datasets at the edge, and difficult to deploy robust security measures like intrusion detection systems or complex encryption algorithms.

Additionally, edge devices may not receive timely security patches or updates due to their remote locations or constrained resources, so vulnerabilities may persist longer on these devices, making them attractive targets for attackers. Edge devices, especially personal devices, can often be misconfigured, creating additional potential security vulnerabilities.

Often located in remote or unsecured locations, edge devices can be more vulnerable to physical attacks. Edge devices exposed to extreme weather conditions, power fluctuations, or other environmental factors can impact their security and reliability. The increased number of secured devices and data points that edge computing facilitates raises the chance of security breaches. Moreover, weak authentication and authorization mechanisms can allow unauthorized users or devices to access and manipulate data or control edge devices, so proper identity and access management are critical.

Managing a distributed network of edge devices can be more complex than a centralized cloud infrastructure, creating new attack vectors and additional entry points for attackers. Threat actors can exploit those devices vulnerabilities to gain network access or steal data.

Edge computing can include a higher up-front cost for the initial acquisition of additional hardware and software, in addition to potential training required to manage and maintain a new solution, despite the savings over the longer term.

The businesss specific needs must be considered when securing a distributed network. For example, a company that relies on real-time data processing may need to implement stricter security controls to help protect against data breaches and denial-of-service attacks. Securing a distributed network presents a unique set of challenges and vulnerabilities that differ from those of traditional centralized networks and require careful consideration.

Why is this? In short, complexity, the variety of devices with different operating systems and security vulnerabilities, the demand for compliance, and network visibility.

Distributed networks are complex and have no central point of control or authority. They involve several technologies, vendors, locations, and, often, multiple perimeters and consist of various devices, nodes, or endpoints with different operating systems and inherent security vulnerabilities. Remote devices, such as laptops and mobile devices, can be more challenging to secure than devices on-premises. This extensive attack surface provides attackers with more opportunities to exploit weaknesses, and decentralization can make it harder to enforce security policies, monitor network activity, and respond to threats in a coordinated manner. Securing each component and the channels between them is an essential consideration.

The dynamic nature of distributed networks means they are constantly changing, making it difficult to maintain visibility into all aspects of a distributed network, keep up with security risks, and ensure that security controls are adequate. Enterprises need to be conscious of these dynamics when considering security.

Distributed networks often handle sensitive data, and many industries have regulatory requirements (e.g., GDPR, HIPAA) that mandate strict data protection measures. Achieving and maintaining compliance across a distributed network can be complex and demanding. Meeting these regulatory requirements is a crucial consideration for securing a distribution network.

Securing a distributed network effectively and providing protection from security breaches requires a comprehensive security strategy that identifies specific security risks and implements appropriate controls to mitigate those risks. The security strategy requires regular reviews and updates to remain effective. Below are some key elements that form part of a robust cybersecurity strategy for edge computing networks.

A zero-trust security model verifies the identity and authorization of all users and devices before granting access to resources. This can help to prevent attackers from gaining access to sensitive data and systems, even if they have compromised a users account or device.

Strong authentication and authorization mechanisms verify the identity of edge devices and users accessing them. These controls help prevent unauthorized users and devices from accessing sensitive data and systems and can include certificates, keys, or biometric authentication. Using role-based access control (RBAC) to define and manage permissions for devices and users limits access to only what is necessary for each entity.

Implementing security segmentation to isolate different parts of the network and edge devices from critical systems can limit the damage caused by a successful attack and help prevent attackers from moving laterally through the network if they can compromise one device or application. Installing firewalls and intrusion detection systems (IDS) enables monitoring and controlling traffic between segments.

Encrypting data at rest and in transit can help to protect it from being intercepted or stolen. It is crucial to ensure that data is encrypted and transmitted between edge devices and data storage or processing centers using secure protocols like MQTT, CoAP, and AMQP. Encrypting data stored on edge devices, especially with persistent storage, using encryption algorithms and keys that meet industry standards, helping protect data in place.

Developing a robust patch management process to keep edge devices up to date with the latest security patches and firmware to address known vulnerabilities is essential for managing them as they are discovered and making it more difficult for attackers to exploit them. Hardware-based security features such as Trusted Platform Modules (TPMs) can store encryption keys and help ensure the devices integrity.

Implementing data integrity checks, such as hash functions, can ensure that data hasnt been tampered with during transmission or storage while validating data at the edge filters out potentially malicious or erroneous data before analysis. Defining clear data retention and disposal policies at the edge helps ensure that data is not stored longer than necessary to reduce the risk of unauthorized access.

Implementing real-time monitoring of edge devices and networks helps detect and respond to security incidents quickly and effectively. Using intrusion detection systems and anomaly detection can identify suspicious activity while maintaining detailed logs of device and network activities that can be analyzed for security incidents and breaches. Its essential to have a well-defined incident response plan to address security breaches promptly, including procedures for identifying, containing, mitigating, and recovering from security incidents.

Employee awareness of security best practices and the importance of data security is vital to understanding potential threats. It can help users avoid making mistakes that could lead to security breaches. Training employees and personnel working with edge devices and data is essential to an enterprises security strategy.

Staying informed about relevant data privacy and security regulations, such as GDPR, HIPAA, or industry-specific standards, is another crucial element of a security strategy to ensure compliance with these regulations in edge computing environments.

Edge computing offers enterprises many benefits, including increased data processing and speed, reduced latency, improved data privacy, and bandwidth optimization. It also brings unique security challenges that must be addressed to protect sensitive data.

Securing a distributed network is a complex task due to its expansive and diverse nature and the need to address various technical, operational, and compliance challenges. Securing data collection and analysis at the edge is an ongoing process that requires a proactive approach, especially as more devices and sensors are deployed in remote or distributed environments.

To mitigate security risks in edge computing environments, organizations should adopt a comprehensive security strategy that includes strong authentication, encryption, intrusion detection, regular patching, secure device provisioning, and continuous monitoring. Additionally, security best practices should be integrated into the design and deployment of edge solutions to minimize vulnerabilities and safeguard critical assets and data. Collaboration with experts in cybersecurity and regular security audits can also help ensure the effectiveness of security measures.

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Best VPS Hosting Providers According to Reddit Users – Eye On Annapolis

VPS hosting may have a steeper learning curve than normal shared hosting, but if you ask any web developer, theyd tell you its well worth the effort and money to invest in VPS hosting.

A virtual private server (VPS) gives you dedicated computing resources (CPU and memory), alongside a completely isolated server environment that allows you to install and customize your own operating system, web server software, security systems, and any other software you need for your website or application.

But finding a reliable VPS provider can be an overwhelming task for a beginner given the countless recommendations presented on review websites. And most of those arent as objective as they may claim to be.

One of the places where you can find many helpful first-hand reviews of web hosting providers is Reddit. In this article, were on a mission to find out which VPS hosts top the list of recommendations within the Reddit community.

The following are five of thebest VPS hostingproviders according to dozens of Reddit user reviews collected in 2023.

DigitalOcean is one of the top cloud VPS providers that developers on Reddit recommend. This company offers cloud server instances called Droplets, which come in different types intended for different purposes.

The Basic Droplets from DigitalOcean provide solid performance at a low price. For example, a Basic Droplet with 1 GB RAM, 1 vCPU and 25 GB SSD storage will only cost you $6 per month. You can optionally choose a premium version of the same Droplet, which is slightly more expensive but comes with improved processing capacity.

If you dont have the technical skills to manage your own virtual server at DigitalOcean, you can pay a little extra to get a fully managed VPS instance from Cloudways. Their platform and UI are much simpler, allowing you to launch a preconfigured virtual server within minutes.

Cloudwaysmakes it very easy and straightforward to host your VPS server instance at DigitalOcean, AWS or Google Cloud Platform. The last two providers are more costly than DigitalOcean.

You can host any PHP application or content management system on your Cloudways managed VPS server. Each plan includes several useful built-in features, such as advanced caching, Cloudflare CDN, staging, and others.

Cloudways is one of the most commonlyrecommended WordPress hosts on Redditbecause of the easy setup and scaling process compared to more complex cloud platforms like AWS.

KnownHost has more traditional VPS hosting services offered at competitive prices. These range from regular SSD VPS servers to high-frequency NVMe VPS servers, which are both available in managed and unmanaged plans.

If your use case requires high CPU or high disk I/O performance, such as hosting a WooCommerce website, youll be able to achieve better performance and speed by choosing one of the NVMe VPS plans available at KnownHost.

The reason that many Redditors vouch for KnownHost, besides the solid performance, is their prompt support service and skilled staff. In case you buy a managed VPS server, they will help you install and configure any third-party software you need to run on your server.

Hetzner is a German company that offers a diverse selection of cloud virtual servers as well as fully dedicated servers. Their cloud servers are available across different data center locations in Europe and the USA.

The cloud hosting instances at Hetzner come in two types: shared CPU and dedicated CPU. The cheaper option is obviously shared CPU, which gives you decent performance for sites or apps that receive low to medium traffic.

If your server will be handling high amounts of traffic or if your application requires high processing power, you should opt for a cloud instance with dedicated CPU.

Contabo is another German VPS hosting company that numerous developers on Reddit recommend. They offer cheap VPS hosting with a lot of RAM, plenty of CPU cores, and a fair amount of NVMe SSD storage.

Contabos VPS hosting is self-managed so it should only be used by those who have experience with Linux systems and server administration. During initial setup, you will have the option to select an OS image to be installed on your newly created server.

Basic server management is available as a paid add-on, but it comes with limited support hours and its very costly compared to other managed VPS hosting services.

In this article, we looked at five VPS hosting providers that have plenty of positive reviews on Reddit. These are: DigitalOcean, Cloudways, KnownHost, Hetzner and Contabo.

DigitalOcean and Hetzner specialize in cost-effective cloud computing instances for development and app hosting purposes. Contabo also has very affordable VPS plans, but performance may fall a little short compared to other providers because of Contabos more crowded servers and resource sharing policy.

And finally, if you are looking for managed VPS hosting for a production website, especially a WordPress or WooCommerce website, two of the best providers to consider according to Reddit users are Cloudways and KnownHost. Cloudways offers better scalability, but KnownHost comes out on top in terms of technical support.

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Industry Voices: Making Data Actionable with Edge AI – Design News

Edge AI and machine learning have become increasingly important in industrial technology settings. With the rise of IoT sensors and smart devices, there is a growing need for edge AI solutions to process data locally and make real-time decisions without relying on cloud services.

TDKs Qeexo AutoML platform was designed to help developers and companies easily implement AI solutions at the edge without the need for extensive machine learning expertise. The goal is to provide a user-friendly interface and automated feature engineering. According to TDK, Qeexo AutoML can significantly reduce the time and resources needed to develop and deploy edge AI applications.

The need for privacy and security is also important for data processing in industrial applications. With edge AI, data is processed locally without being transmitted to a remote server, ensuring better protection for sensitive data.

Edge AI can improve efficiency and reduce latency in various industries such as manufacturing, healthcare, and transportation. By bringing intelligence closer to the source of data, edge AI enables faster decision-making and real-time monitoring. Altogether, edge AI solutions can help reduce costs and improve performance.

We caught up with Sang Lee, CEO of TDK Qeexo, to dig deeper into the issues and advantages of using edge AI.

Sang Lee: The adoption of Edge AI faces two primary challenges: first, it creates high-performance models that can run efficiently on edge hardware, and second, it can address the mass deployment challenges associated with customizing and localizing models for optimal performance in diverse environments.

Sang Lee: Artificial intelligence is vital for IoT and smart devices because it transforms data into actionable insights, enabling real-time decision-making, predictive maintenance, enhanced security, energy efficiency, and personalized user experiences. AI's automation and scalability benefits make IoT devices smarter, more efficient, and adaptable, driving cost savings and reducing environmental impact. It's the cornerstone for realizing the full potential of the IoT ecosystem, revolutionizing industries, and improving the way we interact with our connected environments.

Sang Lee: Edge AI refers to the deployment of AI algorithms and models directly on edge devices, such as IoT devices, rather than relying on a centralized cloud server for processing. It helps in making real-time decisions by bringing AI capabilities closer to the data source, where data is generated, and decisions need to be made.

Sang Lee: Qeexo AutoML streamlines machine learning workflows by automating the most labor-intensive tasks, including data cleaning, sensor and feature selection, model choice, hyperparameter optimization, model validation, conversion, and deployment. This automated process enhances efficiency and saves valuable time, as it evaluates numerous options behind the scenes, identifying the most suitable models for your data.

Sang Lee: Processing AI on the edge device allows for immediate handling of all raw sensor data at the source, eliminating the need to transmit raw data to a remote server for processing. This results in enhanced power efficiency and reduced latency.

Sang Lee: Edge AI can process sensitive data locally, without sending it to external servers. This enhances data privacy and security, which is crucial for applications like surveillance and healthcare.

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POWER OF AI: Methane satellites proliferate, turning to AI to handle … – S&P Global

This feature, which begins to explore some of the main natural gas sector impacts, is part of a longer series that addresses AI in several important areas of the energy industry.

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Also read: POWER OF AI: AI's big promises start to deliver for miners adopting new tech

In early 2024, a new satellite known as MethaneSAT will beam its first megabyte of data to Earth where scientists stand ready with advanced modeling and machine learning -- artificial intelligence -- to pinpoint and measure emissions from leaking oil and gas production sites worldwide.

Around the same time, a coalition of partners led by the non-profit Carbon Mapper project will launch the first of two satellites with the urgent mission to capture high-resolution imagery of methane escaping from oil and gas facilities, as well as strong point sources such as landfills or agricultural operations. Carbon Mapper's data will be used to inform actions to reduce these potent greenhouse gases as well as support initiatives like Climate TRACE, a collaboration of academic and private-sector players who are training artificial intelligence to analyze and calculate greenhouse gas emission sources.

High-tech methane detection is gathering pace against the backdrop of ESG imperatives and energy transition, which have bolstered renewable energy and drawn increasing scrutiny to fossil fuels. Declining costs to launch monitoring satellites, as well as artificial intelligence (AI), which makes parsing terabytes of emissions data feasible, have given the oil and gas industry an emerging tool for environmental stewardship.

"Over the past five years, and I definitely anticipate that over just the next 12 months alone, there are a lot of satellites that we're kind of keeping our tabs on that are expected to go into orbit," Emmanuel Corral, senior emissions analyst for the Center of Emissions Excellence at S&P Global Commodity Insights said in an interview. "There are a few more within the next couple of months, so the landscape is really just constantly changing and evolving as more and more technology goes up in space."

Increasingly, timely satellite images of methane plumes visible on dashboards and publicly available emissions data are also giving the finance sector critical information, proponents of the technology say.

"Knowing who's a better operator, who's the worst operator, who's leaking a lot -- I think that becomes very material to [investors]," said Deborah Gordon, a senior principal with RMI, a nonprofit that leads the modeling of emissions from the oil and gas sector for Climate TRACE. "The other party that's been very interested in this is the insurance and reinsurance industry."

Companies are spending at different rates on machine learning for emissions management, but there is immense interest in utilizing AI to cut emissions and maximize efficiency, according to interviews and public remarks of various industry players.

At the same time, some question the wisdom of spending billions on satellites and cloud computing to try to solve a problem that has been known and largely neglected for decades.

"Intelligence by itself, whether human or artificial, doesn't create a commitment to fix a problem," Clark Williams-Derry, an analyst with the Institute for Energy Economics and Financial Analysis, said in an email. "Knowledge isn't the same thing as a will to act. There's a risk that we'll pretend that AI will 'fix' a problem, when all it will do is give us yet another source of information that we'll collectively choose to neglect."

Leak detection is a necessary component of methane mitigation, but measurement alone does not equal emissions reductions, agreed Erin Tullos, a senior advisor to the United Nations' Oil and Gas Methane Partnership.

"What you want to do is ensure that your measurements are sufficiently accurate to inform your mitigation strategies," Tullos said in a May 2023 report about methane mitigation published by the Industrial Decarbonization Network. "You could try and accurately measure everything. The problem with that scenario is that it might just create a lot of cost and measurement for the sake of measurement."

Some also question the wisdom of spending potentially billions to track methane leaks from space. How far the satellite-AI field goes in pursuit of methane reductions also depends on public funding and private investment, observers say.

GHGSat, a company with nine satellites in orbit serving the oil and gas industry is the first of its kind in the US. The company in 2022 received a $7 million, five-year federal grant to support NASA with methane data, but federal funding for such projects has been largely absent.

With AI, powerful computers can process and analyze huge amounts of data in a matter of a few days, work that used to take weeks or months, said Ritesh Gautam, a lead senior scientist with the team working to launch MethaneSAT. The automation also reduces the risk of human error, he said.

The satellite is a project of the Environmental Defense Fund, which has long pushed for reining in methane gas. The group is planning an advocacy campaign around MethaneSAT and expects to use the data the satellite collects to spur action among industry operators and regulators.

"That's why very, very high-quality data has to be produced that can withstand scrutiny of really anyone who wants to track mitigation... and the commitments made by the oil and gas industry and governments around the world," Gautam said.

More robust data on emissions -- produced from more accurate measurement -- could lend credibility to the argument that fugitive methane emissions need to be mitigated, for the sake of the environment as well as for improved production economics.

The raw satellite data is transmitted to an earth station and can then be found on cloud servers where Gautam and the rest of the MethaneSAT mission operations team compute and calibrate the data with the help of AI.

The team had already built a database of existing oil and gas infrastructure down to individual facilities on which the AI technology is trained and validated. The plan is to be able to link emissions shown on a satellite image to a particular site.

Importantly, the team will be the first in the industry to convert the satellite methane data, which is described as parts per billion, to emissions expressed as kilos of methane released every hour from a larger facility or a cluster of small sites, Gautam said.

Using AI to ferret out methane pollution is a nascent field that may be on the cusp of taking off.

Duke Energy in 2022 pioneered a methane monitoring platform that uses satellites, ground-level sensors, AI and cloud computing to detect leaks and measure methane emissions from its natural gas distribution system in "near real-time."

The project, a collaboration with Accenture and Microsoft, recently received $1 million from the US Department of Energy to extend the platform to the Transco pipeline owned by Duke Energy supplier Williams.

In January, the United Nations Environment Programme partnered with French satellite imaging company Kayrros to detect and track methane leaks in the US and other nations that signed the Global Methane Pledge.

At the same time, satellites tasked with other jobs are finding they can also transmit images of methane sources from oil and gas fields, further broadening the field. A NASA mission launched in July 2022 to measure earth dust from the International Space Station, for example, found that it could also detect dozens of methane "super-emitter" events in a matter of a few months.

"It turns out that different satellites are designed to do different things well, so it really takes a constellation of these satellites to tell the whole story," Gordon said. "The more satellites you put up the more things you can do."

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POWER OF AI: Wild predictions of power demand from AI put industry on edge

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BIS Strengthens Export Controls on Advanced Computing Items … – Sanctions & Export Controls Update –

On October 17, 2023, the US Department of Commerces Bureau of Industry and Security (BIS) released two interim final rules (collectively, the October 2023 IFRs available here and here) amending the Export Administration Regulations (the EAR) to further strengthen export controls on advanced computing items, semiconductor manufacturing equipment, and items that can support end uses related to the development and production of supercomputers, advanced-node integrated circuits and semiconductor manufacturing equipment. The long-awaited October 2023 IFRs come more than one year after BIS issued rules on October 7, 2022 (the October 2022 IFR) targeting Chinas advanced computing and semiconductor sectors and update, expand and clarify those rules in several key ways. Our previous blog post on the October 2022 IFR can be found here. BIS also issued a final rule adding two Chinese entities and their affiliates (13 Chinese entities in total) involved in the development of AI-capable advanced computing chips to the Entity List with a footnote 4 designation (the Entity List FR).

According to the BIS press release and the preambles to the October 2023 IFRs and the Entity List FR, the latest changes are intended to address the national security and foreign policy concerns in countering Chinas military-civil fusion strategy and the development of advanced or frontier AI capabilities that can lead to improved weapons of mass destruction (WMD) and advanced conventional weaponry while minimizing unintended impact on trade flows.

The updates and clarifications in the October 2023 IFRs are extensive and also include BIS responses to the many comments on the October 2022 IFR that provide noteworthy guidance and interpretation on several topics, including quite expansive jurisdictional interpretations with respect to semiconductor supply chains in the context of the end-use controls of EAR 744.23 and the scope of the Entity List Foreign-Direct Product (FDP) rules. A detailed review of all the comments is beyond the scope of this post, but should be a priority for all US and non-US participants in the semiconductor and supercomputer industries.

The October 2023 IFRs take effect on November 17, 2023 (except for a temporary general license which is effective on October 25, 2023). Note that BIS is seeking public comments on certain topics that have not been fully addressed by the October 2023 IFRs, including with respect to access to cloud/infrastructure-as-a-service (IaaS) to develop AI foundation models and deemed exports/reexports. The comment period ends on December 18, 2023.

I. Background

The earlier October 2022 IFR focused on: (i) item-based and end-use-based controls for certain advanced computing integrated circuits (ICs), commodities incorporating such advanced ICs, and supercomputers; and (ii) item-based controls for certain semiconductor manufacturing equipment (SME) and end-use-based controls related to the development and production of SME. The October 2023 IFRs expand and clarify these through an Advanced Computing/Supercomputing IFR (the AC/S IFR) and a Semiconductor Manufacturing Equipment IFR (the SME IFR).

II. Key Changes in the October 2023 IFRs

The AC/S IFR creates a new structure and updates the technical parameters used for identifying items controlled under ECCN 3A090 to ensure ICs for AI training are controlled. Structurally, the revised 3A090 replaces former paragraphs .a.1 through a.4 with a simplified paragraph .a (for the most powerful data center ICs) and a new paragraph .b (covering additional, less powerful but still advanced ICs that could be used to train large-scale AI systems). Substantively, the revised entry removes interconnect bandwidth as a technical parameter and adds performance density as a new parameter. These changes are intended to counter workarounds to the former controls involving the use of a larger number of smaller data center AI chips containing the same power as one restricted chip.

Most importantly, the AC/S IFR (i) excludes certain non-datacenter ICs from control (e.g., certain high end gaming chips) and (ii) replaces bits x TOPS with Total processing performance (TPP) values, defining clear, objective criteria that can be used to calculate the TPP value. The AC/S IFR further refines the scope of control through the addition of new notes to 3A090 and revisions of the technical notes.

The October 2022 IFR used the catch-all criteria or identified elsewhere on the CCL that meet or exceed the performance parameters of ECCNs 3A090 or 4A090 in describing the scope of certain controls (e.g., 742.6(a)(6)). BIS received comments raising concerns that this type of language is confusing, creates potentially dual ECCNs, and makes compliance burdensome.

To address these concerns, the AC/S IFR creates new .z paragraphs for nine ECCNs to affirmatively capture items that BIS has determined have performance characteristics or functions that meet or exceed the relevant performance parameters. The nine ECCNs are 3A001.z, 4A003.z, 4A004.z, 4A005.z, 5A002.z, 5A004.z, 5A992.z, 5D002.z, and 5D992.z.

The AC/S IFR also requires exporters to identify .z items at the items level classification in the electronic export information filing in the Automated Export System and, in certain cases, on the commercial invoice for export clearance.

The SME IFR removes ECCN 3B090. Controls on SME formerly under ECCN 3B090 are expanded and placed under ECCNs 3B001 and 3B002 (with a view to these being controlled multilaterally in the future). A number of additional types of SME and equipment for manufacturing SME are now controlled, including: certain equipment designed for silicon (Si), carbon doped silicon, silicon germanium (SiGe), or carbon doped SiGE epitaxial growth; certain equipment designed for coating, depositing, baking or developing photoresist formulated for EUV lithography; semiconductor wafer fabrication cleaning and removal equipment; and inspection equipment designed for EUV mask blanks or EUV patterned masks, amongst others. These revisions to ECCNs 3B001 and 3B002 also prompted conforming changes to ECCNs 3D001, 3D002, and 3E001. For software and technology related to newly controlled SME described under 3B001, Regional Security (RS) and National Security (NS) controls have been added. The newly controlled equipment and related software/technology have been determined by BIS only to be used (with limited exceptions) for fabricating logic ICs with non-planar transistor architecture or with a production technology node of 16/14 nanometers or less. Companies should carefully review the new and revised ECCNs.

The SME IFR states that BIS licenses for equipment classified under ECCN 3B090 remain valid until expiration, unless suspended or revoked. At the same time, exporters are required to list the new ECCNs on any export clearance documentation filed after November 17, 2023.

The SME IFR provides that there will be no de minimis level for certain foreign-made lithography equipment (and specially designed parts) that are now classified under ECCN 3B001.f.1.b.2.b when destined for use in the development or production of advanced-node integrated circuits (Advanced-node ICs), except if the country from which the foreign-made item was originally exported also controls the item (currently only Japan). This means that otherwise any amount of US origin content will make a foreign-made lithography equipment subject to the EAR under this ECCN.

The AC/S IFR broadens the country scope with respect to the advanced computing FDP rule to Country Group D:1, D:4, and D:5 countries that are not also specified in Country Groups A:5 or A:6 (currently, countries that fall within both Country Groups D:1, D:4, and D:5 as well as Country Groups A:5 and A:6 include only Cyprus and Israel). The country group for this rule is further expanded to be worldwide when the foreign-made direct product is for an entity headquartered in, or whose ultimate parent entity is headquartered in, either Macau or a D:5 country.

The AC/S IFR clarifies that the model certificate published in the October 22 IFR and which appears in supplement no. 1 to part 734 of the EAR may be used for all FDP rules. The AC/S IFR clarifies that the model certificate may be provided by anyone in a supply chain and flows both forward and backward in a supply chain (e.g., from the exporter, reexporter, or transferor to another entity in the supply chain or from a consignee back to an exporter, reexporter, or transferor).

The October 2023 IFRs expand the list of countries for which licenses are required for National Security (NS) and Regional Stability (RS) reasons. This is apparently intended to close a loophole in exports to offshore affiliates of Chinese/Macau companies.

Specifically, under the revised controls in 742.4 and 742.6, a license requirement now extends to:

Applications that involve transactions falling under categories (i) and (ii) above will be reviewed consistent with license review policies in EAR 744.23(d), except applications will be reviewed on a case-by-case basis if no license would be required under part 744 of the EAR rule. For applications falling under category (iii) above, if the items are for Macau or a D:5 country, then the applicable license review policy is a presumption of denial; if the items are for non-D:5 countries, the applicable license review policy is generally a presumption of approval, unless to an entity headquartered in, or whose ultimate parent entity is headquartered in, either Macau or a D:5 country, in which case the applications will be reviewed under a presumption of denial policy.

Consistent with the October 2022 IFR, the license requirements above do not apply to deemed exports/reexports (although BIS seeks comments on this.)

The AC/S IFR expands the scope of the end-use controls in EAR 744.23 by adding two new advanced computing end-use controls under new EAR 744.23(a)(3) that impose a license requirement on:

The AC/S IFR also expanded the country/destination scope of the supercomputer end-use controls and Advanced-node IC end-use controls to Macau and any D:5 country (not limited to China).

The SME IFR further reorganizes and simplifies the end-use controls adopted in the October 2022 IFR. The changes are shown in the below table included in the SME IFR.

We note the following key takeaways from the changes to 744.23 :

The October 2023 IFRs reformat, revise and clarify the US Person restrictions under EAR 744.6(c), incorporating guidance provided by BIS under FAQs issued since the October 2022 IFR, as follows:

In short, US persons are prohibited from knowingly shipping, transmitting, or transferring (in-country), facilitating these activities, or providing services in connection with the following items, end-uses, or end-users:

No license exceptions apply to these prohibitions. The AC/S IFR creates new sections to supplement no. 2 to part 748 of the EAR with guidance on how to apply for a license under the US person restrictions.

License applications will be reviewed with a presumption of denial for Macau and D:5 countries, except activities involving a foreign-made item not subject to the EAR that performs the same function as an item subject to the EAR which will be reviewed with a presumption of approval. All other applications will be reviewed with a license review policy of case-by-case.

The October 2023 IFRs create two new TGLs as follows:

This AC/S IFR TGL overcomes the new RS controls in EAR 742.6(a)(6)(iii) to authorize the export, reexport, and transfer of certain otherwise controlled items to or within D:1, D:4, or D:5 countries (excluding countries also specified in Country Group A:5 or A:6) where the recipient is located in Macau or a D:5 country but is not headquartered in and whose ultimate parent entity is not headquartered in Macau or a D:5 country to continue or engage in integration, assembly, inspection, testing, quality assurance, and distribution of items covered by the product scope of the TGL, provided for the ultimate end use outside of a D:1, D:4, or D:5 country (excluding countries also specified in Country Group A:5 or A:6) by entities that are not headquartered in or whose ultimate parent company is not headquartered in Macau or a D:5 country.

The AC/S IFR TGL does not overcome the license requirements triggered by the involvement of a party on the Entity List or the Military End-User List or knowledge of any other prohibited end-use or end-user (with some exceptions under 744.23).

The AC/S IFR TGL is valid for two years and expires on December 31, 2025.

This SME TGL authorizes the export, reexport, or transfer (in-country) of (i) non-EAR99 items subject to the EAR and controlled only for AT reasons, (ii) to manufacturing facilities in a D:5 country or Macau, (iii) for the development or production of parts, components, or equipment of certain Category 3B ECCNs specified in EAR 744.23(a)(4), provided (iv) at the direction of companies headquartered in the United States or an A:5 or A:6 country and not majority-owned by an entity headquartered in, or whose ultimate parent entity is headquartered in, either Macau or a D:5 country.

According to the SME IFR, this TGL is intended to give SME manufacturers in the United States and A:5 and A:6 countries additional time to identify alternative sources of supply outside of restricted countries or to obtain BIS licenses to continue manufacturing front-end IC production equipment.

The SME TGL cannot be used for the indigenous development or production of Category 3B tools or parts in a D:5 country or Macau at the direction of an entity headquartered in, or whose ultimate parent entity is headquartered in, either Macau or a D:5 country. This TGL also does not overcome the license requirements triggered by the involvement of a party on the Entity List or the Military End-User List or knowledge of any other prohibited end-use or end-user.

The SME TGL is effective immediately, valid for two years and expires on December 31, 2025.

The AC/S IFR creates a new License Exception NAC (at EAR 740.8) authorizing exports, reexports, and transfers of (1) certain less powerful but still advanced ICs under the new ECCN 3A090.b and (2) certain 3A090.a commodities that are not for data centers but do have a TPP of 4800 or more. License Exception NAC cannot be used for ECCN 3A090.a data center ICs and, with limited exceptions, is generally not available for transactions that are subject to a license requirement under Parts 744 or 746 of the EAR or for transactions involving a military end-use/user.

For exports and reexports (excluding in-country transfers) to Macau or a D:5 (arms embargoed) country, prior notification of 25 calendar days must be provided to BIS via STELA prior to the first export or reexport. Notification requirements do not apply for transfers (in-country) within D:1 or D:4 countries. This notification requirement is intended to enable the US Government to collect information about the export of less advanced ICs. BIS will publish a further notice when STELA is ready to accept License Exception NAC notifications.

The October 2023 IFRs make commodities classified under ECCNs 3A991.p and 4A991.l eligible for License Exception Consumer Communications Devices (CCD), add eligibility for License Exception TMP for temporary exports of advanced computing items under 3A090 and 4A090 for inspection, test, calibration and repair, make other adjustments to various license exceptions related to the new .z ECCN paragraphs, amongst other changes.

The SME IFR introduces two newly defined terms: advanced-node ICs and extreme ultraviolet.

These two terms are used in the US person restrictions in EAR 744.6, the end-use controls in EAR 744.23, and various ECCNs.

In response to comments to the October 2022 IFR, the AC/S IFR adds five new red flags to the Know Your Customer Guidance in supplement no. 3 to part 732 of the EAR to help the public ensure compliance with the new rules. These include a red flag for knowledge of future intent to develop or produce restricted supercomputers or advanced ICs. Additional due diligence may be required to address and resolve these red flags before proceeding with a transaction.

III. Entity List FR

BIS added two Chinese entities and their affiliates (13 Chinese entities in total) to the Entity List with a footnote 4 designation for their involvement in the development of large AI models and AI chips for defense purposes.

The Entity List FR includes a savings clause that exempts shipments from the new license requirements associated with the Entity List party that were en route aboard a carrier to a port of export, reexport, or transfer (in-country) on October 17, 2023, pursuant to actual orders.

***

Despite some simplifications, the new restrictions remain extensive, highly complex and technical. Companies in the advanced computing, semiconductor manufacturing equipment and supercomputer sectors should carefully review the new October IFRs to assess the impact on their operations. We will continue to monitor developments and are available to answer questions.

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TSMC Makes The Best Of A Tough Chip Situation – The Next Platform

If you had to sum up the second half of 2022 and the first half of 2023 from the perspective of the semiconductor industry, it would be that we made too many CPUs for PCs, smartphones, and servers and we didnt make enough GPUs for the datacenter. Or rather, Taiwan Semiconductor Manufacturing Co, the worlds largest and most important chip foundry, didnt.

The world would probably buy somewhere between 1 million and 2 million datacenter GPUs this year, but apparently Nvidia could only make on the order of 500,000 of its most advanced Hopper H100 devices this year, and that was limited by the availability of the Chip on Wafer on Substrate (CoWoS) 2.5D packaging technique that has been in use along with HBM stacked memory for GPUs and other kinds of compute for the past decade.

And so, TSMC has had to make the best of the situation even as revenues and earnings remain in a slump and the cost of each successive manufacturing process node gets more and more expensive.

In the third quarter ended in September, TSMCs revenues were down 14.6 percent to $17.28 billion and net income fell by 28.1 percent to $6.66 billion. The various IT channels are still burning off their capacity of CPUs and GPUs for client devices, and the hyperscalers and cloud builders are also digesting the tens of billions of dollars in servers and storage that they acquired in 2022 and only buying what they need now as they await the next generation of devices and another heavy investment cycle that could start next year.

Everyone is shifting some of their server, storage, and switching budgets in the datacenter to higher cost and more strategically important AI training and inference systems as the generative AI boom is well underway and there is no sign of that boom stopping anytime soon after a period of hyperinflation this year. And so, GPUs and anything that can do matrix math like a GPU are almost worth their weight in gold as companies try to figure out how to weave generative AI capabilities into their applications during a period of intense demand and limited supply.

In these cases, TSMC can charge more for its advanced chip etching and packaging capacity, but not enough to offset the declines in other parts of its business. Unlike, say, Nvidia, which can pretty much charge whatever it wants for any GPU that it can get out of the factories. Its financials will continue to defy gravity for a while. But eventually, as capacity constraints ease supply will catch up with demand and prices will normalize. But not this year, not even as Nvidia doubles its CoWoS capacity and seeks to increase it further through 2024.

TSMC has to cope with a lot of tensions in its line of work, and one of them is that it has to do a lot of research, development, and capital investment to make sure it can keep advancing the state of the art in semiconductors. And when business slows, as it has in recent quarters for reasons sometimes out of its control and sometimes because it is difficult to plan for booms like the one that took off for GenAI in late 2022, the company has to make a lot of calls about when to curtail capital spending and still not leave itself flatfooted. Thats because TSMCs customers can benefit much more from supply shortages and high demand than it can. Again, Nvidia is the illustrative case in point.

In the September quarter, TSMC really pulled back on the capital investment reins, spending only $7.1 billion, a decrease of 18.9 percent compared to the year ago period and also representing a 13.1 percent sequential increase from the $8.17 billion the company spent on factories, etching equipment, and so forth in Q2 2023. Wendell Huang, chief financial officer at TSMC, said on a call with Wall Street analysts that TSMC was expecting to spend only $32 billion for capital expenses in all of 2023, with 70 percent being for advanced chip making gear at the smallest nodes (5 nanometers and lower these days), 20 percent for specialty technologies that tend to be at larger nodes (12 nanometers up to 28 nanometers), and about 10 percent on packaging, testing, and mask making gear. That means capital expenses in Q4 2023 will be around $6.8 billion, a drop of 32.7 percent.

This is as the ramp for 3 nanometer processes is well under way and 2 nanometer technologies are building momentum towards ramp.

The third quarter was the first where TSMC sold products based on 3 nanometer processes, and this node already accounted for 6 percent of revenues, or just over $1 billion out of the chute. Chips etched with 5 nanometer processes drove $6.39 billion in revenues, or 37 percent of the total, while 7 nanometer processes still drive 16 percent of revenues, or $2.76 billion. All other processes, ranging from 12 nanometers all the way up to 250 nanometers drove the remaining $7.08 billion in sales. All of those older nodes have plenty of use a lesson that Intel forgot because it was a foundry with only one customer, and one that always needed to be at the bleeding edge to compete in CPUs.

N3 is already in volume production with good yield and we are seeing a strong ramp in the second half of this year, supported by both HPC and smartphone applications, explained CC Wei, chief executive officer at TSMC, on the call. We reaffirm N3 will contribute mid-single-digit percentage of our total wafer revenue in 2023, and we expect a much higher percentage in 2024 supported by robust demand from multiple customers.

Remember that when TSMC says HPC it means any kind of high performance silicon, which can be a PC or server CPU or GPU or a networking ASIC. TSMC does not mean ASICs dedicated to HPC simulation and modeling or AI training or inference although these certainly are within the scope of TSMCs HPC definition. The 3 nanometer node will be a long-lasting one, with an N3E crank having just passed qualification further enhancements in the N3P and N3X processes in the works. The N5 node has been in production since Q3 2020, just to give you a sense of how long these nodes can be in the field, and it has only just become the dominant revenue generator. The N7 nodes are on the wane, of course, but will also be in the portfolio for a long, long time.

Like Intel 18A, TSMC N2 will employ a nanosheet transistor structure and will drive both transistor density and power efficiency. For smartphone and HPC applications, which drive the business, Wei said that interest in N2 is at or higher than it has been for N3 at the same point in their development and production cycles. The backside power rail adjunct technology for N2 will be available in the second half of 2025 and put into production in 2026.

As for who will have the lead in process in 2025, Wei is having none of the smack talk of Intel 18A versus TSMC N2.

We do not underestimate any of our competitors or take them lightly, Wei said. Having said that, our internal assessment shows that our N3P now I repeat again, our N3P technology demonstrates comparable PPA to 18A, my competitors technology, but with an earlier time to market, better technology maturity, and much better cost. In fact let me repeat again our 2 nanometer technology without backside power is more advanced than both N3P and 18A and will be semiconductor industrys most advanced technology when it is introduced in 2025.

Your move, Pat.

Last thing. TSMC did not divulge how much of its revenues were being driven by AI training and inference workloads, as it did during its Q2 2023 conference call. But if the ratio between AI revenues and TSMC HPC revenues is consistent, then it should have been just shy of $1 billion. That seems low to us, but it might just be an indication of how much profits companies like Nvidia and AMD can extract from GPU sales these days.

If you can make a compute engine for an Nvidia or an AMD a few hundred bucks and add HBM memory for a few thousand bucks and then an Nvidia or an AMD can sell the complete device $30,000 and then maybe get another 2X factor in sales turning those compute engines into a system with lots of CPU compute, CPU memory, flash storage, and networking, this becomes a very big business. So that $1 billion in AI training and inference chip sales for TSMC can balloon up to tens of billions of dollars in hardware spending at the end user level even if those end users are hyperscalers and cloud builders among the Super 8 or Top 10 or whatever who get steep volume discounts from companies like Nvidia and AMD.

Maybe TSMC and its downstream chip partners and further downstream partners could adopt a new short-term strategy: The more you buy, the even more you should pay. At this point, it is just as logical to say that those who need 20,000 GPUs should pay more per unit than someone who needs only 200 or even 2,000 as it is logical to say they should be paying less, as the IT market seems to have believed for decades.

Right?

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Google’s Gen-AI models are coming to more Android phones with … – Android Authority

TL;DR

Google and Qualcomm have partnered to bring powerful generative AI experiences to Android phones. The two companies announced their tie-up to bring more on-device AI to Android devices during the Snapdragon 8 Gen 3 launch. Googles state-of-the-art foundation AI models will run on Qualcomms Hexagon NPU. These are likely the same foundation models that also run on the Pixel 8 Pro and power AI features like on-device recorder summaries, Smart Reply in Gboard, and the upcoming Video Boost feature.

With Googles AI models running on-device on the Snapdragon 8 Gen 3, more Android phones will be able to perform on-device AI tasks, making way for new features, performance improvements, and power savings.

Among the first generative AI models you see running on Snapdragon will come from none other than Google. Over the past few months, researchers at Google have been working to take their massive next-generation large language models and distill them to fit on a mobile device. Soon, youll be able to do more on-device with Google applications than ever before, said Alex Katouzian, SVP and GM of Mobile, Compute, and XR at Qualcomm.

Googles VP of engineering for Android, Dave Burke, also joined the conversation on stage during the Snapdragon 8 Gen 3 launch to confirm that the companys partnership with Qualcomm will enable complex AI models to run on-device on upcoming Android flagship phones, removing the need for internet connectivity and round trips to cloud servers.

Simply put, we can now expect smarter and faster AI processing on premium Android phones with the latest Snapdragon chip. The Qualcomm Snapdragon 8 Gen 3 processor supports large language models with over 10 billion parameters running at almost 15 tokens per second. You can read more about the Snapdragon 8 Gen 3 here. Qualcomm also gave us a glimpse at what to expect from its next flagship processor. You can read about the Snapdragon 8 Gen 4 here.

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