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TSMC plans to halt chip supplies to Huawei in 2 months
- singhrac 6y agoDoesn't seem to worry them too much: https://www.thestreet.com/investing/tsmc-posts-record-q2-profit-sees-robust-chip-demand-in-2020 https://www.thestreet.com/investing/tsmc-posts-record-q2-pro...
- kurthr 6y agoWe do seem to be in a secular upswing in semiconductor demand, while TSMC remains the last foundry standing at the 7nm node. It seems like Samsung and Intel alternatives are bit too captive (internally competitive) for a large mobile phone producer. I don't think it's about actual 5G chips themselves, it's about ARM processors and mobile SoCs. It's doubtful to me that UMC and Global Foundries will catch up, but I do wonder at the long term effects. There are many billions of Yuan to spend on solving this problem. In the past they could get enough of the right people to move to China as they did with OLED.
- trevyn 6y agoBut you see, money can’t buy love.
- mytailorisrich 6y ago> In the past they could get enough of the right people to move to China as they did with OLED. TSMC was founded by a "returnee" as well. Obviously he and his family were rather anti-communist (his father was a ROC official) so he fled from mainland China to Hongkong then the US during the Chinese Civil War. He built a career at TI then returned to China (Taiwan) and founded TSMC when the government was investing in the development of hitech industries. [1] There are quite a few similar examples on both sides (communists and nationalists). For example, and that's quite a twist of history, the 'father' of the PRC missile and space program was an MIT professor, Caltech professor, co-founder of JPL and was even involved in project Manhattan... Then he returned to mainland China in 1955 [2]. These days there are many more mainland Chinese in the West and Taiwan who work in the semiconductor industry and it's not uncommon for them to return to mainland China to take key positions. There is no doubt that they'll catch up. The only question is how fast. [1] https://en.wikipedia.org/wiki/Morris_Chang https://en.wikipedia.org/wiki/Morris_Chang [2] https://en.wikipedia.org/wiki/Qian_Xuesen https://en.wikipedia.org/wiki/Qian_Xuesen
- knzhou 6y ago> Then he returned to mainland China in 1955. It's worth remembering that he did that because he was pushed out, during the Red Scare.
- dragonelite 6y agoYou already see the same happening under the Yellow peril banner.
- DiogenesKynikos 6y agoQian Xuesen was stripped of his security clearance in 1950, as a result of the Red Scare, meaning he couldn't work on his areas of expertise any more. He tried to leave the US, but was arrested on his way out and kept under house arrest for 5 years. That's the thanks he got for helping found the US rocketry program, so when he was released, he founded China's rocketry program.
- ttul 6y agoThe next shoe to drop will be if ASML cuts off Chinese chipmakers. ASML absolutely dominates fab tech.
- xxpor 6y agoOr the Dutch government bows to pressure from the US and makes the decision for them.
- mytailorisrich 6y agoThey already have. https://www.reuters.com/article/us-asml-holding-usa-china-insight/trump-administration-pressed-dutch-hard-to-cancel-china-chip-equipment-sale-sources-idUSKBN1Z50HN https://www.reuters.com/article/us-asml-holding-usa-china-in...
- jacquesm 6y agoOr maybe they did it by themselves because they are capable of independent decision making. Just the other day someone here was loudly proclaiming we shouldn't be interested in US politics from overseas because it doesn't affect us. HN should make up its mind about this in a well reasoned way.
- caycep 6y agoThat's what I am wondering about. Is ASML the weak point? Would a US, Taiwan, or other company be able to develop and manufacture comparable lithography or EUV machines, or do they essentially have a chokehold on the market for now?
- ttul 6y agoYou can't fast-track the technology developed by ASML. We're talking about a company with 4,000 engineers (correct me if I'm wrong btw) who have been working on lithography magic for decades. EUV took decades of dedicated research to finally become a reality just in the past few years. They literally vaporize tin into a plasma in order to create the EUV light, which then has to pass through incredibly complex optics on its way to the mask. 97% of the light is lost on its way to the target... This thing consumes megawatts. It's literally magic.
- ajross 6y agoYeah, exactly. TSMC has the premier process right now and is at capacity making chips for Apple, Qualcomm and other high margin (i.e. well-paying) customers. Cutting off the oddball folks for PR reasons costs them nothing at the moment.
- sudosysgen 6y agoHuawei is bigger than Apple. It's not exactly an oddball.
- rgbrenner 6y agoBy what measure? They have less than half the revenue, and only 9b in profits last year.
- sudosysgen 6y agoTotal phone sales, in number of units, which is what matters when figuring out how many chips to make, as well as market share as a proportion of units.
- threeseed 6y agoYou are also going to need to factor in upcoming Mac sales as well. And for all we know Apple may move to a multi-CPU strategy for its higher end products meaning you will get significantly more volume.
- sudosysgen 6y agoFor all we know Huawei might do so too, plus HiSilicon makes their own modems while Apple buys them from Intel. Mac sales are essentially insignificant compared to phone sales, and nowhere near enough to make up the gap in units between Huawei and Apple.
- ajross 6y agoNot as a TSMC fab customer it isn't, not remotely. The overwhelming bulk of Huawei's revenue remains in device manufacturing. They're a very recent entrant into the SoC market, and not moving a lot of product there.
- nimbius 6y agoarticle conveniently doesnt mention the fact that huawei's 5g chip isnt sourced from an American design, rather its the Balong 5000 which has been around since january of 2019. the 16 nm chipset can easily be cranked out from Semiconductor Manufacturing International Corporation (SMIC) in mainland china, which is capable of 14nm runs. barring that, GlobalFoundries as they havent expressed any serious interest in Americas trade war witch hunt masquerading as a security concern.
- amaranth 6y agoGlobalFoundries is a US company, no extra leverage needed to block them from doing business with Huawei.
- 0xy 6y agoAccording to the US DoJ they use technology which was stolen from US companies, so it's at least partially American design.
- zolosa 6y ago5G design stolen from America..sure
- 0xy 6y agoHuawei had an encrypted email address explicitly for stolen trade secrets and offered bonuses up to employees who delivered stolen tech and secrets. [1] [1] https://www.justice.gov/opa/pr/chinese-telecommunications-device-manufacturer-and-its-us-affiliate-indicted-theft-trade https://www.justice.gov/opa/pr/chinese-telecommunications-de...
- ArkVark 6y agoWhy does this feel like the USA cutting Japan off from metal and oil shipments months before WW2?
- sambull 6y agoIf foundations of geopolitics is anything real, then pitting the US vs China would be the ultimate best outcome. The book believes China is the true threat to Russia and "must, to the maximum degree possible, be dismantled". As secondary goal would be the disruption of the US which also has been propping China up. https://en.wikipedia.org/wiki/Foundations_of_Geopolitics#Content https://en.wikipedia.org/wiki/Foundations_of_Geopolitics#Con...
- starfallg 6y agoYeah, but Russia is so isolated these days that pitting anything non-Russian vs. something else non-Russian is almost guaranteed to be advantageous to Russia. That also doesn't change the fact that long term, China is the biggest threat to liberal democracies. In terms of geopolitics, Russia is actually quite complementary to China due to its large area having an abundance of resources to feed Chinese factories and both countries being authoritarian governments.
- FooBarWidget 6y agoWhy would China be a threat to liberal democracies? I get that people don't like the fact that China is not democratic, but how does that suddenly turn into a threat?
- knolax 6y agoApparently this is the result of a May 15 rule change[0] to the Export Administration Regulations[1], which affect anything exported from the US. The lesson here is that if you're a foreign company that buys US software and equipment, apparently the US government can tell you who you are and aren't allowed to do business with. [0] https://www.commerce.gov/news/press-releases/2020/05/commerce-addresses-huaweis-efforts-undermine-entity-list-restricts https://www.commerce.gov/news/press-releases/2020/05/commerc... [1] https://en.m.wikipedia.org/wiki/Export_Administration_Regulations https://en.m.wikipedia.org/wiki/Export_Administration_Regula... PS. Some hilarious quotes from the DoC announcement: > "Huawei and its foreign affiliates have stepped-up efforts to undermine these national security-based restrictions through an indigenization effort. However, that effort is still dependent on U.S. technologies,” said Secretary of Commerce Wilbur Ross. “This is not how a responsible global corporate citizen behaves. " Maybe it's just me but the term "global corporate citizen" just seems so absurd and dystopian.
- yannikyeo 6y agoWondering if America government has the power to forbid foreign companies or countries from using open source software such as Go, Rust, React, Kubernetes, Docker, Ubuntu etc especially those with strong stewardship by US corporations.
- phkahler 6y agoThat seems like a "no". Anyone can get access to those things as they are freely downloaded. Access may get restricted but they can keep an old copy indefinitely, and the internet is fairly useful for getting around arbitrary blockages.
- strbean 6y ago> The lesson here is that if you're a foreign company that buys US software and equipment, apparently the US government can tell you who you are and aren't allowed to do business with. Sometimes referred to as sanctions. I don't think this is a revelation for anyone doing business internationally.
- bigpumpkin 6y agoI've heard rumors that MediaTek, another Taiwanese chip company, could be supplying Huawei[1]. How will it get around US sanctions? [1]https://www.androidcentral.com/mediatek-huawei-silicon-savior-tsmc https://www.androidcentral.com/mediatek-huawei-silicon-savio...
- Klinky 6y agoMediaTek is fabless and relies on TSMC. I am sure MediaTek could be pressured as well. Also going from in-house designed SoC/Modem to third-party is still detrimental.
- chvid 6y agoSMIC, the mainland supplier expected to replace TSMC, successfully IPOs with a massive jump: https://www.cnbc.com/2020/07/16/smic-chinas-biggest-chipmaker-surges-in-shanghai-listing.html https://www.cnbc.com/2020/07/16/smic-chinas-biggest-chipmake... JUL 15 2020 SMIC, China’s biggest chipmaker, saw its shares surge 245% at the open on its first day of trade in Shanghai. SMIC issued issuing 1,685,620,000 shares at 27.46 yuan per share, raising 46.28 billion yuan ($6.62 billion). Shares were trading at 95 yuan at the open.
- robert_foss 6y agoSMIC isn't close to the same node as TSMC. A competitive high-end SOC could not be manufacured by them.
- chvid 6y agoI guess time will tell.
- robert_foss 6y agoThe patterning machines used for the leading node isn't exported to China due to export restrictions. Only the Dutch company ASML is able to manufacture these patterning machines.
- bhouston 6y agoIf China didn't hate Taiwan enough...
- m00x 6y agoI'm sure the feeling is reciprocated. Taiwan is being bullied 24/7 by China. They even have Chinese military jets doing "military exercises" in the Taiwan fly zones. https://www.voanews.com/east-asia-pacific/voa-news-china/china-sends-8-military-planes-taiwan-airspace-analysts-see-move https://www.voanews.com/east-asia-pacific/voa-news-china/chi...
- lihan 6y agoThe bully really stems of that some do not recognise "one China", which is not the point of view in Beijing. You cannot say it's bully if Taiwan is part of China. If you have doubt, search "1992 Consensus".
- umanwizard 6y agoEven if you think Taiwan is part of China, it’s perfectly possible to claim that one set of Chinese people (the PRC government) is bullying another set of Chinese people (the Chinese people of Taiwan).
- kwistzhaderach 6y agoSo Taiwan are allowed to fly planes over the PRC without trouble?
- qlk1123 6y agoStop spreading artificial history like "1992 Consensus". It was not even mentioned in the 1992 meeting.
- lihan 6y agoThe real history disagrees, they are widely available on the internet as well as plenty of history references in real libraries.
- Nokinside 6y agoWhat this means is that TSMC stops producing Huawei designed chips. Huawei has to buy third party designed and manufactured chips, most likely MediaTek. Manufactured in TSMC factories but not Huawei designed or Huawei owned IP.
- chasil 6y agoAs I understand it, Huawei has engaged SMIC. https://www.theburnin.com/industry/huawei-new-supply-deal-smic-shanghai-microelectronics-2020-6/ https://www.theburnin.com/industry/huawei-new-supply-deal-sm...
- GekkePrutser 6y agoWouldn't that put Mediatek on the radar of the US for getting similar measures taken against them?
- ytch 6y agoIIRC, if you want to use 5G/4G with MTK chip, you need to pay license fee to QCOM? and US can still ban this.
- 0xFFC 6y agoExcuse my ignorance, why Huawei just does not ditch TSMC (snapdragons) and only improve/use HiSilicon Kirin?
- trsohmers 6y ago"Snapdragon" is a core designed by Qualcomm (based on ARM IP), which is a fabless semiconductor company, and has no relation to Huawei. TSMC is a semiconductor foundry (fab) company that does not design any chips but manufacturers them for other companies. Kirin is currently being manufactured by TSMC for Huawei, but will not be in 2 months.
- 0xFFC 6y agoOkey, why they don’t manufacture Kirin in HiSilicon then?
- deleted 6y ago[deleted]
- slim 6y agoChina will nationalize TSMC
- deleted 6y ago[deleted]
- verdverm 6y agoasml.com/en/company/about-asml/locations
- trsohmers 6y agoAssuming when you say China you mean the UN recognized "China", then they do not have any control over TSMC.
- kevin_b_er 6y agoThis is a threat to Taiwan that China will just invade it and take whatever, including nationalizing TSMC.
- lihan 6y agoIt's an threat in some people's imagination.
- slim 6y agoUN views Taiwan as a province of PRC
- LatteLazy 6y agoI feel bad for the hard working people at huawei. But also, fuck the CCP.
- d33lio 6y agoI don't think TSMC is going to lose much sleep over this one either.
- croes 6y agoGuess who will suffer. The CPC or the people?
- dang 6y agoPlease don't do this here. You may not owe the CCP better, but you owe this community better if you're posting to it. We want curious conversation, not denunciatory rhetoric. Those two are mutually exclusive. The idea is: if you have a substantive point to make, make it thoughtfully; if you don't, please don't comment until you do. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html Here's another way to look at it. When posting, ask this question: what's the expected value of the subthread of which this is the root? If the answer, as in this case, is "poor to destructive", please don't post. https://hn.algolia.com/?dateRange=all&page=0&prefix=true&query=by%3Adang%20%22expected%20value%22&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que...
- LatteLazy 6y agoI'm sorry, maybe I didn't fully explain my point or was too blunt about it? It seems its too late to delete the root comment now so in future I'll try to be a bit more detailed and not just post a one line conclusion...
- AsyncAwait 6y agoAll these things seem like desperate moves from a failing empire. I don't believe for a second the U.S. cares about human rights here. That doesn't mean I think the CCP is 'good', but 2 things can be true at the same time. EDIT: typo
- mclightning 6y agoUS to care about human rights is not necessarily a precursor condition for this set of events to be eventually better for human rights.
- RcouF1uZ4gsC 6y agoExactly. US entry into WWII was mainly for reasons that had little to do with human rights. But the defeat of Nazi German and Imperialist Japan had huge, favorable results for human rights.
- AsyncAwait 6y agoBack then the politics were a lot less polarized and you had sane domestic policy under FDR, these are different times. That was when U.S. understood that you can only attain so much by brute force.
- kick 6y agoLess polarized? Huey Long got shot for FDR to get in, and actual socialism was a thing in the United States. Assassination attempts were regularly made against union busters.
- AsyncAwait 6y agoWhat I meant was that there was a better sense of what left or right actually means on an international scale. Nowdays centre-right presidents like Barack Obama or Biden get called socialist, somebody on the international centre left like Sanders is apparently a communist and Chomsky is an out of his mind, left of Mao crazy person. Pink haired college kids are apparently a serious threat and there's a "culture war" or something. It seems fairly abnormal, especially considering Medicare for All is apparently still crazy, even in the middle of a deadly pandemic the U.S. is currently doing terrible at.
- christophilus 6y agoWhat's to prevent China from re-branding Huawei, or something along those lines? Then, US / UK / Taiwanese companies could say: we're no longer dealing with Huawei. We're dealing with Uawei. It's different? China could do something like that indefinitely, as a workaround, no? Or, China could just have any number of new shell companies order TSMC parts, and then hand them over to Huawei.
- RcouF1uZ4gsC 6y ago> Then, US / UK / Taiwanese companies could say: we're no longer dealing with Huawei. This is one of the big differences between laws and code, and many programmers get this confused. In code, intention does not matter. What code you write, is what the CPU executes. In law intention matters. If you came before a judge and pleaded innocent because Huawei changed their name to Uawei, the judge is going to laugh as they sentence you to the same punishment as supporting Huawei.
- bserge 6y agoHe's downvoted but he's got a point. What if it's not as simple as just changing their name? What if you dismantle Huawei and sell it off to "other" companies, operating independently and/or cooperating with each other? At some point it would be extremely hard to say "this is still Huawei". The US gov should've banned all major Chinese companies, because that seems like a big loophole to me. Even then it still seems like just a temporary measure.
- mlindner 6y agoI think they’re on the way to banning them, just a matter of time.
- shalmanese 6y agoThat's exactly what got Huawei into this mess in the first place. The US placed sanctions on selling telecom equipment to Iran and Huawei went "We aren't selling telecom equipment to Iran, this totally unrelated company 'Skycom Technologies' is" who happen to be comprised of employees who still had Huawei email addresses. Guess how well that turned out.
- nix23 6y agoOh nice they help to make Chinese chip manufacturing stronger...probably not what Taiwan want's.
- bserge 6y agoI'm actually cautiously excited about new competition in high end semiconductor fabrication. Huawei and China won't just sit around twiddling their thumbs, they've got to manufacture chips somehow/somewhere.
- systemvoltage 6y agoWhat you missed is the massive global interconnected supply chain that goes into building the fab (not the building, but the process equipment and software). China’s isolationism will cause massive pains to do it all in house. If they can, we are all fucked.
- bserge 6y agoBut between investing a ton of money into that and negotiating with the US, I can only see China doing the former. They've done it before (quite recently, too), whole tech supply chains inside China. I don't think the CCP would want to be seen as "begging" to lift the bans...
- birdyrooster 6y agoTheir monoculture provides a lower ceiling for capability than the world at large. We aren't remotely fucked.
- nafey 6y agoWhat you are calling monoculture is somewhere around 1/6th population of the world. If you take into the account the inroads that China has made into Africa, Middle East and Eastern Europe we might be seeing ourselves entering another phase of the cold war.
- threeseed 6y agoThose inroads are disintegrating. The quality of the deliverables hasn’t been great, they have been poorly managed and have left many countries either in significant debt or with onerous obligations.
- euix 6y agoThe founder of SMIC on the mainland is actually Taiwanese and a former TSMC executive. Loyalties cut across the strait both ways, westerners overemphasis attachment to values and ideology over bloodlines and ancestry. It's true for some but not for others. There are quite a lot of foreign engineers working on the mainland, especially Taiwanese engineers. If you are a industry vet or got some kind of special talent you can easily 3x your salary by moving to the mainland from Taiwan. For example, Justin Yifu Lin, the former World Bank chief economist was a Taiwanese defector who to swam to Mainland China. Before he defected in the (early 90's I believe) he was a rising star within the establishment in Taiwan. Short term definitively bad for Huawei, but the long term it should help the development of the indigenous semiconductor industry on the mainland. Necessity is the mother of invention and nowhere else is there the capital, political will and now sheer necessity as there is on the Mainland. A lot of "huaqiao" i.e. overseas Chinese that go back to the mainland (I include Taiwanese people here) despite the repressive political atmosphere and bad environmental quality, food safety are motivated by this. In the West you can only go so far, back there, especially if you have specialized technical knowledge, you have a chance to make an impact at scale that would never be possible in the West. I am not sure what the U.S. can really do about this without adopting essentially the same repression as in China. I.E. control the flow of personal. On the mainland if you are a leading expert in this field or that, or belong to specific establishments (such as public security or state security) you cannot exit the country without permission from higher up the food chain. Anyways, my point at the end, is the central point of competitive advantage or a company or nation is human talent. You can restrict technology or natural resources but it's human beings that make a company or a nation competitive. So unless the U.S. finds a way to prevent talent from flowing to the mainland, either from the U.S. and/or other parts of the world it is very hard to prevent another country, especially such a big one from doing what you don't want. And when they eventually do get to that point they will be twice as bitter at you for having tried to stop them.
- themodelplumber 6y agoThe old idea that westerners, particularly Americans, overemphasize values and ideology is a great example of a perspective that leads others to underestimate their competitors. Sure, economic impact and power are huge. And that's far from a settled zone of conflict, I would add. But when a values-based culture leans into its strengths once again, in the famous United sense, one must ask how well its competitors can compete, or if they can compete at all, in that specific arena. The idea that adopting repression is the only recourse here is in effect directly advising against the deployment of established strengths. (By the way, did all those millions of Hong Kongers in the streets suddenly disappear, or...?)
- longliveTrump 6y agoTSMC steals US technology for decades. Time to stop TSMC!
- wef2323tg23 6y agoChina will probably "buy" a lot of chip making experts around the world to catch up. Anyway it's good to have more competition.
- themoviewindow 6y agoIt is hard to feel sorry for them with all the blatant human rights abuse, bullying neighbors and arm twisting weaker countries. As expected, this thread is full of people responding with whataboutism!
- dnprock 6y agoI see this news as a loss for the US. It has to resort to regulations to stop TSMC from doing business with Huawei. When you can't incentivize your ally, that means your opponent's business is still very attractive. Regulations will only cripple your ally. Taiwan may comply on the outside. But inside, they'll cut under-the-table deals with China. They'll find loop holes to skirt regulations. Taiwan seems to be heading to be the next Hong Kong. Their political class is still publicly resistant. But their business leaders are slowly surrendering. At some point, the political class will follow. The US will then need to rely on the activism of the young renegade "colonels" like Joshua Wong. Crippling an ally can buy the US some time. But it is losing ground.
- 0xy 6y agoThe US will defend Taiwan by any means necessary, including nuclear options. If they don't, they've already lost to China. Chip superiority is everything. If the US can't manufacture or source modern chips then it's over for them. US leaders and the military know this to be true. Taiwan is not Hong Kong. The US doesn't need Hong Kong. The US needs Taiwan.
- peteretep 6y ago> The US will defend Taiwan by any means necessary Under a normal president, sure. Under this one, who can’t decide if he hates China or loves Xi? All fucking bets are off
- magnusmagnusson 6y agoThe previous Presidents of United States sold American manufacturing to China and you propose they would have been more willing to defend Taiwan in case of theoretical Chinese takeover? Delusional. Terminal brainrot from politics.
- hajile 6y agoPublic politics and policy are different. All negotiations with Xi the PERSON will get nowhere if you go around insulting and humiliate him publicly. Instead, you have intense private discussions and then smile for the camera and say polite exaggerations or lies. This is politics as usual under ANY administration. The results of those private discussions are shown in public actions against the COUNTRY for failing to act as desired. Trump says nice things about Xi while passing the most restrictive legislation against China that we've seen in decade. Make things against Xi personal and the chances of war skyrocket. His sensitivity and crackdowns about Winnie the Pooh jokes shows that Xi isn't exactly the most stable dictator where his public image is concerned. The fact that bills concerning China make it through both Democrat-controlled House and Republican-controlled Senate (especially as they can't seem to agree on almost anything else) speak volumes as to the importance of what's going on.
- mrtweetyhack 6y agoThey'll just set up dummy companies or buy current companies and get it another way
- yalogin 6y agoTSMC's headquarters is in Taiwan. Wonder if these kinds of issues will make China do to Taiwan what it did to Hongkong.
- thethethethe 6y agoI feel like this plays into China's hand. Now Huawei and China will build up their own microchip design and manufacture capabilities which will, at some point, rival the west. Strictly from a strategic standpoint, it seems like keeping China dependent on US technology is a good way to maintain hegemony
- socialdemocrat 6y agoI don’t like the CCP but I also find it extremely distasteful how the US is always bossing around their smaller allies. Alliance with the US is such a one sided deal. America is a poor role model. Through these actions it is really just telling China that “night is right” It is like saying “When you become as powerful as us, you also get to boss around small countries” I really wish the world was not as dominated by a few hyper powers.
- amelius 6y ago> I also find it extremely distasteful how the US is always bossing around their smaller allies. Imo, you can boss around but only when you're acting like a "father figure" to the rest of the world. Right now, the US is acting more like a grown-up baby.