4 ms·

I have to wonder - how much of the fabs going to Taiwan, Shanghai, SK are due to 1) government support - i.e. the national government saying "we want this sect

by caycep 6y ago

I have to wonder - how much of the fabs going to Taiwan, Shanghai, SK are due to 1) government support - i.e. the national government saying "we want this sector to succeed" and providing funding via grants/loans/subsidies, (or by fiat w/r to PRC) 2) actual labor costs? 3) talent, i.e. American-trained Chinese/Taiwan/Korean talent coming home, then generation 2.0 starting up research at Chineses/Taiwan/korean universities? Assuming a long-term visionary US government wanted to compete; would we have to fund fab research, development, and capital i.e. similar to the pentagon funding Newport News shipyard to keep strategic know-how alive in the US market?

nostrademons 6y ago
Probably all of the above. The founder of TSMC was educated at Harvard/MIT/Stanford, and spent the first 25 years of his career working for Texas Instruments in Silicon Valley. He founded TSMC because the Taiwanese government gave him a large grant to found a nonprofit research institute in Taiwan. He was looking at the competitive landscape and realized that the one way Taiwan could capitalize on its biggest advantage (low labor costs of fairly educated labor, at the time) was to do only manufacturing and outsource the design, IP, and marketing to other countries that were better at it.
tooltalk 6y ago
1) gov't support: TSMC's had plenty of gov't support from the getgo and my understanding is that the govt still has some financial stake in TSMC -- which would be a red flag in the US. Samsung has a big $15B fab in Austin, TX aka, FTZ foreign-trade zone, where Apple's A chips were made until the early 2010's, but after Apple moved to TSMC in Taiwan in 2012-13, it stopped investing in smaller nodes -- now, it's mainly producing memory products (and Tesla's FSD chips). All their latest nodes (< 14nm) are in South Korea. 2) labor cost: probably very insignificant. While they employ high-paying high-tech workers, it's a capital-intensive, not labor-intensive, business. Both TSMC and Samsung spend over $10+B annually on CAPEX. 3) brain drain?: Morris Chang worked for TI for decades before founding TSMC. He pretty much started the outsourcing business in the late 80 single-handedly. Sure. I don't agree with Trump on a lot of things, but he's at least doing something to bring them back.

by caycep 6y ago

nostrademons 6y ago

Probably all of the above. The founder of TSMC was educated at Harvard/MIT/Stanford, and spent the first 25 years of his career working for Texas Instruments in Silicon Valley. He founded TSMC because the Taiwanese government gave him a large grant to found a nonprofit research institute in Taiwan. He was looking at the competitive landscape and realized that the one way Taiwan could capitalize on its biggest advantage (low labor costs of fairly educated labor, at the time) was to do only manufacturing and outsource the design, IP, and marketing to other countries that were better at it.

tooltalk 6y ago

1) gov't support: TSMC's had plenty of gov't support from the getgo and my understanding is that the govt still has some financial stake in TSMC -- which would be a red flag in the US. Samsung has a big $15B fab in Austin, TX aka, FTZ foreign-trade zone, where Apple's A chips were made until the early 2010's, but after Apple moved to TSMC in Taiwan in 2012-13, it stopped investing in smaller nodes -- now, it's mainly producing memory products (and Tesla's FSD chips). All their latest nodes (< 14nm) are in South Korea. 2) labor cost: probably very insignificant. While they employ high-paying high-tech workers, it's a capital-intensive, not labor-intensive, business. Both TSMC and Samsung spend over $10+B annually on CAPEX. 3) brain drain?: Morris Chang worked for TI for decades before founding TSMC. He pretty much started the outsourcing business in the late 80 single-handedly. Sure. I don't agree with Trump on a lot of things, but he's at least doing something to bring them back.