Why? Assuming people thinks that China will invade Taiwan just to take over TSMC, then what?
1) TSMC doesn’t build the tools that builds the microchips. In fact, they probably don’t even know how to build it, or even know the optical science to research and develop it. That dubious honor goes to ASML, and some other Japanese companies. But ASML, the euro company is currently in the lead for 5nm. TSMC just knows how to use their machine, and to get better at it. And to be clear, ASML doesn’t know how to manufacture the chips like TSMC can, so both companies need each other, in a symbiotic type of relationship.
2) In the event of war, then the losing side can just bomb TSMC factories. Then everyone is screwed. No more advanced microchips for anyone.
3) If China succeeds in invading Taiwan, then the USA will just force ASML to stop selling their equipment to China, like they already do now. So, China is back at square one. They might have the current technology, but no ability to advance to newer technologies.
The only viable solution for China, is to build their own chip making tools, and fabrication factories. Thus removing ASML and TSMC from the equation completely. Also, they will gain independent Intellectual Property rights and patents to their own indigenous R&D.
The American government is apparently thinking that China doesn’t have the skills to do this.
Also, given how obscenely expensive a war would be, couldn't China save money by just hiring the entirety of TSMC's and ASML's technical staff at 10x the market rate for ten years?
Paying a premium to headhunt technical experts is a tried-and-true method of catching up to a front-runner. In fact, both Taiwan and South Korea did this, poaching underpaid Japanese talent.
Yes. ASML is integrated into the dollar-based global financial system, so it will have to respect American financial sanctions. This is the same way that such sanctions against Iran and North Korea work.
An interesting aspect though: I think the technological superiority of ASML is a big asset in these discussions. e.g. If the US would follow up on a threat of sanctions against ASML (e.g. banning US companies from working with ASML) it would hit the US semiconductor industry quite hard (particularly Intel), while non-US players (e.g. TSMC) could continue producing with euv.
In effect, they would have to go much further to keep some similarity of a level playing field: e.g banning all products containing chips produced on ASML machines. That would hit a lot more companies, many of them US based too. Creating even more reasons for the US Gov to not to take such drastic steps.
Therefore I expect that it is much more likely they'll use pressure on the EU / NL government systems to force the behaviour they want, compared to economic sanctions vs ASML.
> ASML is integrated into the dollar-based global financial system, so it will have to respect American financial sanctions
I'm no expert, but if a company wants to pay ASML in Euros, I'm pretty sure they can accept euros. The dollar is convenient, not a requirement.
The implication is not about accepting payment. The western banking system can and has blackballed firms that took money from people the US didn't like.
Companies rarely exchange money directly, though. They usually have a bank do it on their behalf, and those banks are subject to the laws of the countries they operate in.
You also have to avoid SWIFT, since the US controls that too.
The Europeans just set this up to avoid these issues with Iran:
https://en.wikipedia.org/wiki/Instrument_in_Support_of_Trade...
It took nearly a year and a half between the founding and the first payment.
On one hand, they brag about how a company in China took apart an ASML machine, and replicated every component, but it didn't work.
But I'm sure ASML knows that they'll try again. They have at least a limited interest in keeping their technology from being stolen.
That's assuming those folks would want to move to China and work there. If strategic tensions are increasing to the point where war is feared and China uses this as an alternative, who would want to move there and risk becoming a hostage?
https://asia.nikkei.com/Business/China-tech/Taiwan-loses-3-0...
Netherlands / ASML is subject to Wassenaar Arrangement which US can ultimately trigger to ban dual use tech sales.
Probably doesn't make much of a difference though.
TSMC has investnents in many tool makers, and has own tooling RnD.
How much needed are further advancements? Aren't we reaching the limits of shrinkage and clock speed? Computers can be used for years because there are no more huge increases. It may cost some more energy, but the current technology should be good enough for 10 to 15 years until China has its own knowledge.
Reverse engineering is just working backwards, until you get to parity. Certainly, this will get you far, but you’ll always be a step behind the leader. But what you really need, is to advance and take the lead.
In order to achieve that, you need the scientific process here to understand the fundamental basics. Then you can build on that and expand.
But, what we know is that the Dutch company, ASML, has a tool that can achieve 5nm.
To China, this means that the engineering is possible. They just have to throw more time, money, and people at it. They don’t even need to follow the same techniques as ASML, they just have to get at the same end result, the 5nm. Solve the basic science, and it will allow you to achieve the engineering. Then, they can expand, and target 3nm, or whatever the next technology is. Carbon nanotubes based CPUs?
SMIC is in 14nm risk production, and aggressively working on EUV.
We're still several years from that, but probably not several decades from it.
For instance a great question is if the EU thinks a fab is worth the effort? Probably not in today's climate, and would most likely be a sign of the end of US geopolitical domination if they do feel the need.
Most EU countries have fabs, even small countries like Switzerland and Austria although they're not as cutting edge as TSMC.
Like the Interstate Highway system, basically.
And I'm inclined to believe it: TSMC guaranteeing that PRC would fail to capitalize on their assets if they invaded Taiwan is a primary national security concern for the Republic of China.
On the other hand, perhaps there are other ways to destroy a silicon fab than explosives?
During WW2, a short additional tunnel was dug above the tunnel entrance, to be filled with explosives in order to blow it up. This was so that if Japan invaded, the Japanese military would not be able to use the railway line to help them invade Sydney. The feared Japanese land invasion never came, the explosives were never detonated, but the tunnel dug for the explosives is still there today: https://en.wikipedia.org/wiki/File:Interior_of_World_War_2_d... https://en.wikipedia.org/wiki/File:Interior_of_World_War_2_d...
I wouldn’t be surprised if Taiwan has a similar setup in place.
[0] https://en.m.wikipedia.org/wiki/Stay-behind [1] https://en.m.wikipedia.org/wiki/Operation_Gladio
The author does point out that it will take years for any new replacement to reach TMSC's capacity.
you're implying that the author has violent predispositions?