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This is quite fascinating. Trump and his cronies are now willing to burn his own house down, and burn everyone else’s house down, in order to not let anyone pl

This is quite fascinating. Trump and his cronies are now willing to burn his own house down, and burn everyone else’s house down, in order to not let anyone play. Blocking TSMC from selling to Huawei, might very well kill TSMC. I don’t know the specifics, but TSMC rely on the sales from Huawei to sustain their R&D and manufacturing investments. This is why it is economical for Apple and Qualcomm to use a contract manufacturer, since only they (TSMC) can sustain the economy of scale. If TSMC falls apart, then where is Apple and Qualcomm going to manufacture their chips? By doing this, Trump has now painted a target on every other Chinese company: DJI, One Plus, Xiaomi, Lenovo, Alibaba. Although I am sure they have already drafted up contingency plans. At some point, if it hasn’t happened already, these companies are going to band together, and create their own platforms and technologies. The Chinese market is massive enough to sustain these companies internally, while they mature and build out their technology, for later export to the rest of the developing world. The key tool here is the photolithography machines from ASML. Once China’s scientists builds a replacement, then there is no further dependence. So if Trump wants to get the maximum effect, then he should pull the trigger on this, right now. Five years ago, a lot of pundits kept saying that Chinese tech companies were only competitive because they had the China government backing them up, and blocking the Chinese market from American domination by Google and Facebook. Well, today, that decision seems prescient. Nobody back then, ever thought that an American President would do such a thing, but today, here we are.

ksec 7y ago
>Blocking TSMC from selling to Huawei, might very well kill TSMC. Um. NO. They either continue to sell Smartphone using chips from TSMC, or they retreat the Smartphone market where other maker will continue to use TSMC's chip.
- blackrock 7y ago
  I think you read my sentence backwards.
totalZero 7y ago
Trump may have some deep problems but even a broken clock tells the right time twice a day. It's about time the U.S. government took China to the mat on its abusive practices in the tech sphere. There's major demand for CPU fabs right now due to a combination of cloud hardware needs and poor execution from Intel on 10nm. If Huawei doesn't get to sit at the table, TSMC'll take a hit temporarily but eventually find someone else to take up the dormant fab capacity. I don't agree with the people who say TSMC will be burnt to a crisp if it turns its back on Huawei; that would hurt all the other Chinese companies that do business with TSMC, and give the US a compelling reason to establish a military base in Taiwan. The best answer to DJI would be US investment in a major quadcopter-based drone program done by a private company, potentially to police the southern border or some other big-ticket national project. DJI's real advantage is in its efficiency and dynamics, which is more a challenge of mechanical engineering and controls than a semiconductor issue. EUV is expensive and there's a backlog of demand for that kind of machinery, but ASML has a lot of institutional knowledge and they also know exactly where all of their machines are bolted to the ground. Not exactly the easiest thing to reverse engineer. It appears that SMIC tried to buy an EUV machine and that was blocked, although ASML has not confirmed the identity of the company. Chinese tech companies skirt IP law, steal trade secrets, and have the Chinese government backing them up. It's about time the U.S. government backed up American silicon companies.
- blackrock 7y ago
  > give the US a compelling reason to establish a military base in Taiwan Now this is just crazy talk. This is just begging for WW3. You might as well launch the nukes right now, and see who survives afterwards to pick up the pieces. I don’t think the fine people of San Francisco or New York City wants to be in the crosshairs of a thermonuclear ICBM. Some people are going to have a very bad sunburn on that day. Although it would make for a great Instagram selfie: Check out that #mushroomcloud behind me! The point being, is that we need to walk a fine line here, and not risk escalating this to something kinetic. Because once those bullets and missiles start flying, then both sides are going to look deep into the abyss, and not see the bottom. In the past, wiser men have avoided starting a war between the two countries. Today, we need those sensible leadership more than ever.

ksec 7y ago

>Blocking TSMC from selling to Huawei, might very well kill TSMC. Um. NO. They either continue to sell Smartphone using chips from TSMC, or they retreat the Smartphone market where other maker will continue to use TSMC's chip.

blackrock 7y ago
I think you read my sentence backwards.

totalZero 7y ago

Trump may have some deep problems but even a broken clock tells the right time twice a day. It's about time the U.S. government took China to the mat on its abusive practices in the tech sphere. There's major demand for CPU fabs right now due to a combination of cloud hardware needs and poor execution from Intel on 10nm. If Huawei doesn't get to sit at the table, TSMC'll take a hit temporarily but eventually find someone else to take up the dormant fab capacity. I don't agree with the people who say TSMC will be burnt to a crisp if it turns its back on Huawei; that would hurt all the other Chinese companies that do business with TSMC, and give the US a compelling reason to establish a military base in Taiwan. The best answer to DJI would be US investment in a major quadcopter-based drone program done by a private company, potentially to police the southern border or some other big-ticket national project. DJI's real advantage is in its efficiency and dynamics, which is more a challenge of mechanical engineering and controls than a semiconductor issue. EUV is expensive and there's a backlog of demand for that kind of machinery, but ASML has a lot of institutional knowledge and they also know exactly where all of their machines are bolted to the ground. Not exactly the easiest thing to reverse engineer. It appears that SMIC tried to buy an EUV machine and that was blocked, although ASML has not confirmed the identity of the company. Chinese tech companies skirt IP law, steal trade secrets, and have the Chinese government backing them up. It's about time the U.S. government backed up American silicon companies.

blackrock 7y ago
> give the US a compelling reason to establish a military base in Taiwan Now this is just crazy talk. This is just begging for WW3. You might as well launch the nukes right now, and see who survives afterwards to pick up the pieces. I don’t think the fine people of San Francisco or New York City wants to be in the crosshairs of a thermonuclear ICBM. Some people are going to have a very bad sunburn on that day. Although it would make for a great Instagram selfie: Check out that #mushroomcloud behind me! The point being, is that we need to walk a fine line here, and not risk escalating this to something kinetic. Because once those bullets and missiles start flying, then both sides are going to look deep into the abyss, and not see the bottom. In the past, wiser men have avoided starting a war between the two countries. Today, we need those sensible leadership more than ever.