> TSMC will win.
Absent any geopolitical difficulties... but that's a whole other discussion.
Absent any geopolitical difficulties... but that's a whole other discussion.
Geopolitics have been figured out. TSMC's next 5nm plant will be in Arizona. https://appleinsider.com/articles/21/06/01/tsmc-starts-const...
The current shortage is making countries like the US realise that semiconductors are a critical commodity for the function of their advanced economies.
The US wants fabs back on their soil and will probably be willing to burn money to make it so.
Will the US be satisfied with just having foreign operated fabs on US soil? Or will the US want home growth (and firmly under US control) companies like Intel to have similar capabilities.
Frankly, IMHO things in the long term aren’t looking that great for TSMC. Some of their business is going to get eaten by “local” fabs - even if they can’t do leading edge nodes they will eating into TSMC’s business on the lower end.
There is also the danger of overcapacity destroying any profitability in the fab business altogether - guess who will get bailed out by the US government if that happens; hint: not TSMC.
The boom/bust cycle is nothing new in semiconductors. It's a fairly regular thing. Also, keep in mind that consolidating and repositioning during downturns is how TSMC became TSMC.
In general, if semiconductors become a national security issue, I think there will be a fundamental change in the nature of the business. It will not be business as usual for TSMC.
Maybe, who knows what the future will bring.
But I've heard this before [1] and once recessions hit, and budgets get cut, that kind of thing quickly becomes less tenable.
And then someone realizes that it takes a constant stream of incoming parts to keep the equipment inside any factory running for any meaningful amount of time, and that supply is not protected, and neither are their suppliers...
But I agree, things will not stay as they are. The only thing usual about this business is change.
[1] The US semiconductor manufacturing sector was under serious assault by the Japanese in the 80s. That was my first "trade war" in this industry...
https://www.washingtonpost.com/archive/business/1985/09/22/s...
Semiconductors could end up like the US defense industry, which the US feeds with a continuous amount of money (recession or not) and is not outsourced for obvious reasons - but its products are sold to others; other countries outsource to the US. The US buys military tech on occasion but rarely ever directly buy the hardware in significant numbers - they will manufacture it in-house. It's great if it turns a profit but that's not the point.
Every country has their own defense industry if they can afford it.
That said, it remains to be seen how seriously the US government is about this. The $50 billion USD bill hasn’t passed through Congress yet. But if the US government does decide to make huge moves, things might change in a big way.
TSMC is no doubt pretty worried hence their setting up of fabs in the US now in an attempt to hopefully ward off US government action.
TSMC's Q3 shown bulk of their revenue come from higher end node. 7nm along is at 34%. the only other options for high end node is Samsung and Intel.
I don't see any long term problem for TSMC if they keep going at its current pace.
Not many foundry can do high end. GlobalFoundries vow out at 7nm a long time ago.
https://investor.tsmc.com/english/encrypt/files/encrypt_file...
It takes a lot of water to make the ultra pure water needed to wash the wafers. Without access to lots of water they will too will have issues.
PRC will have enough military strength to attack Taiwan and challenge US Carriers. We don't know if they'd win but... enough strength that they're a real threat... at least near China (with assistance from land-based hypersonic missiles and whatnot). PRC probably doesn't have the military strength to attack Arizona.
China will have a Navy that (by tonnage) rivals the US's Navy in a few short years. US still will have more capital ships but there's big, unanswered questions about what the proper tactics will be in the next great naval battles.
Would we rather have the US's "Supercarrier" strategy? Big ships with lots of money put into each one? Or would China's "little ships" strategy be superior?
Really: one question. Will China's hypersonic missiles truly be a capital-ship killer? If their weapon can truly kill a US Supercarrier, (or more specifically: if China __believes__ it can kill the US Supercarriers) then China will probably attack Taiwan.
China is building a navy for _some_ reason. Taiwan seems like the obvious target.
------
China's increasingly large Navy is a big enough deal that the USA has given away its nuclear submarine secrets to Australia to counter-act the threat. That doesn't really change the picture too much (US always had nuclear-submarines available), but its clearly a degree of saber-rattling going on right now between US and China.
we had an actual intel plant manager who actually ran one of intel's fabs on one of the previous threads about this and HNers of course deigned to tell him his business, as usual. Love it.