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Current TSMC dominance is shortsighted happenstance that is not in any major power bloc's interest, least of all US. Yes the silicon shield protects TW, and exp

Current TSMC dominance is shortsighted happenstance that is not in any major power bloc's interest, least of all US. Yes the silicon shield protects TW, and exploiting it as silicon lance can inhibit PRC, but ultimately it's better for PRC for TSMC fabs to be within PRC rocket force ranges, on TW soil without explicit US security commitment than say Samsung Fab on SK soil. US could be pressing PRC a lot harder if not for these fabs. There's also the broader consideration of East Asian IC supply chains in general, PRC/TW/JP/SKR accounts for ~75% of global IC capacity. Losing TSMC in war over TW will set the world back 1-2 nodes and 10 years, losing regional fabs in a broader war over TW will knock out decades worth of capex. Global semiconductor industry is 500B market, trillions in terms of industries affected, most of which benefits west. TW GDP is ~600B. TSMC concentrating fabs on TW is more liability than prize in that regard. East Asian semi supply chain in aggregate is more or less IC mutually assured destruction, and everyone of them can be directly threatened / leveraged by PRC if Sino-US competition goes hot. TW losing semi leverage in medium / long term is forgone. The interesting development ahead is whether US will be able to hold on to IP dominance in the space and convince others to block tech to PRC. Recent high level talks in this regard is happening while US is pressuring non-US fabs for supply chain info to direct investments in US for the semi reshore effort. Ultimately goal is to undermine east asian semi industries the same way US killed Japan's semiconductor in the 80s. Right now every party is reshoring fabs while working towards de-americanized supply chains because everyone wants to sell to PRC and fears US sanctions that still gives preferential exemptions to US companies. EU/JP/KR car industry were not happy about TW/TSMC preferencing US companies while barginning for political gains with semi supply. Ergo recent pressuring of TSMC to spread fabs around with carrot and stick. While fabs are raking it during covid due to extreme demand and double booking, that will level off eventually. Latest Semiconductor Industry Association report is guestimating self sufficient local supply chains will cost at least 1T and 35-65% increase in prices. The strategic IC moat is eventually going to exclude a lot of smaller countries. Who will want TW as part of their blocs' supply chain if their fabs are existential risk? Queue Morris Chang.

Jansen312 5y ago
Western countries can build up those bombed facilities in 6mths. The issue is just money which USA has plenty. China such move will doom her to be split apart. Every regional countries want that to happen even both Russia and NK (historical she is also due for such event). It would be incredibily stupid for CCP to do such a thing. It would be like they never read or heard of Sun Tzu. 1 or 2 leaders maybe, entire CCP chain of command?
- dirtyid 5y ago
  Lead time for semi equipment is already years. Supply of qualified labour and expertise is constrained. Money is not the issue. Would take decades to rebuild existing capex. China broke apart meme negates the fact that when united, Chinese dynasties typically last 300 years if they survive first 50. Threatening east Asian supply chain is incredible smart because it resets world to PRC semi levels and forces US to fight within 1st island chain where PRC is strongest. It's massive deterrence to prevent fighting in the first place, per Sun Tzu.
jimmont 5y ago
Do we have the same concerns with Samsung being nestled so close to the mainland and North Korea? I myself don't imagine they'd do so well without US support either. If we're talking geopolitics, if Taiwan falls then frankly I expect Korea, part/all of Japan and the Philippines are next. If that impacts those foundries then I'd be curious how to regard former and current TSMC management's comments at that point in time/circumstance.
- dirtyid 5y ago
  They have explicit US security commitment. Which potentially constrains how much US can respond in TW crisis. Roping in US assets in JP or SKR for TW defense will come with extreme costs. It's a risk US wants to mitigate, hence talk about reshoring entire supply chain even if extremely difficult.

Jansen312 5y ago

Western countries can build up those bombed facilities in 6mths. The issue is just money which USA has plenty. China such move will doom her to be split apart. Every regional countries want that to happen even both Russia and NK (historical she is also due for such event). It would be incredibily stupid for CCP to do such a thing. It would be like they never read or heard of Sun Tzu. 1 or 2 leaders maybe, entire CCP chain of command?

dirtyid 5y ago
Lead time for semi equipment is already years. Supply of qualified labour and expertise is constrained. Money is not the issue. Would take decades to rebuild existing capex. China broke apart meme negates the fact that when united, Chinese dynasties typically last 300 years if they survive first 50. Threatening east Asian supply chain is incredible smart because it resets world to PRC semi levels and forces US to fight within 1st island chain where PRC is strongest. It's massive deterrence to prevent fighting in the first place, per Sun Tzu.

jimmont 5y ago

Do we have the same concerns with Samsung being nestled so close to the mainland and North Korea? I myself don't imagine they'd do so well without US support either. If we're talking geopolitics, if Taiwan falls then frankly I expect Korea, part/all of Japan and the Philippines are next. If that impacts those foundries then I'd be curious how to regard former and current TSMC management's comments at that point in time/circumstance.

dirtyid 5y ago
They have explicit US security commitment. Which potentially constrains how much US can respond in TW crisis. Roping in US assets in JP or SKR for TW defense will come with extreme costs. It's a risk US wants to mitigate, hence talk about reshoring entire supply chain even if extremely difficult.