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Morris Chang founded TSMC, the most valuable company in Asia
- chasil 3y agoHere is an interview with a former vice president of research at TSMC (and later SMIC). I encourage you to read the interview in its entirety. It is illuminating. On the question of of bringing up a new process node: "We all take two years to develop one generation, how come you guys can do it in one or one-and-a-half year?" And they asked if some of your customer transfer technology to you or what not? And I told him, "No," I told him that, "That's not true." I think he probably implied we steal technology from customer, the way he talk. And I say, "I'll tell you why." I said that, "When we develop one node, basically you have some learning cycles. First, you do some simulation. And you have some idea, then you run wafers to prove that. So, you run a group of wafers according to simulation and you have some splits. The wafer runs through the fab, they come out and you measure them, you analyze them, and you try to improve and you run this again. This again, you run. So, this is learning cycle." At that time, "It takes about six learning cycle, roughly, to complete one generation." Of course, you had some short loops and not just one. I said that, "My R&D wafer in the fab run much faster than yours, because my R&D engineer works three shifts and you only work one shift. So, your R&D wafer move eight hours a day, my work/move 24-hours a day. So, my wafers go three times faster, even if you are twice smarter than me, I still beat you up." <laughter> https://www.computerhistory.org/collections/catalog/102792671 https://www.computerhistory.org/collections/catalog/10279267...
- Arubis 3y agoThis is a significantly better read than TFA. I encourage you to submit it.
- 2muchcoffeeman 3y agoThe submitted article is written to give people with no idea what’s happening some understanding of the issues. Different audiences.
- chasil 3y agoOK, I'll submit it. https://news.ycombinator.com/item?id=37185090 https://news.ycombinator.com/item?id=37185090
- chasil 3y agoNow that doesn't make any sense; with 17 up votes, I should still be on the front page.
- arboles 3y agoWhat's illuminating about this? He's just saying his engineers work longer hours, 24 hour a day (hyperbole)
- raincole 3y agoIt's not hyperbole tho. Quite a lot people work in shifts in TSMC.
- adrian_b 3y agoA few decades ago, I have worked for some years in an European semiconductor fab. There the R&D engineers also worked in 3 shifts, to follow experimental wafer batches all day. However, most of the time the R&D engineers worked in the normal shift. By rotation, a few worked in the evening shift and even fewer worked in the night shift, typically only when it was expected that after finishing some process step it will be necessary to measure test structures on the experimental silicon wafers and make decisions about process parameters for the following process steps. So work at least partially in shifts is really expected in such an environment, because it is inefficient and costly to stop the processing of a wafer batch and wait until next morning, when an R&D engineer would come and would decide what to do with the wafers next.
- KirillPanov 3y agoWow, you completely mangled what he said. His engineers work three shifts. They aren't (necessarily) working longer hours. But they're willing to work second and third shift at times, which R&D engineers in bascially every other first-world country refuse to do. If you had a bunch of R&D engineers willing to work 16-hour days every day of the week, as long as they could sleep from midnight to 8am, you still wouldn't be able to keep up with TSMC. It isn't longer hours.
- MichaelZuo 3y agoConsidering how much fabs cost, or so all publications say, it's actually surprising for any R&D departments to not run three shifts 24/7 to maximize utilization. When 1 EUV machine setup and ready is a quarter billion dollars...
- amadeuspagel 3y agoThere's an actual measure of how important companies are and how many want control of it and how much they want, and TSMC is #12: https://companiesmarketcap.com/ https://companiesmarketcap.com/
- yumraj 3y agoMarket cap != “importance” Think of it like this, which would have a bigger impact: 1) if Apple or Google or any of the other companies at the top in that list were to magically vanish tomorrow 2) if TSMC were to magically vanish tomorrow
- tiahura 3y agoApple or Google would have a much bigger impact.
- kaliqt 3y agoBut recoverable quite easily. TSMC? No. Massive shortages. iCloud going bye bye sucks, but you can cut your losses and move. Samsung can't just triple capacity over night, and thus the entire world crashes and burns for a while.
- Dylan16807 3y agoFor the first month or two. Then we start running out of the good chips. Though I'd say a clearer scenario is them disappearing with a couple months of warning. In that case the impact of Apple or Google disappearing would be greatly lessened, while TSMC's impact would be just as enormous.
- yumraj 3y agoIMHO, they would have zero impact. I’m fully in Apple ecosystem, but I can migrate to Linux or Windows computer and Android phones. I don’t use Google for search and have been trying to get off of Gmail anyway. If FB vanishes, I won’t feel anything. Same for most of other companies. But without TSMC, no computers, no mobile devices, every hardware would be impacted and most things would be limited to stock at hand. To have a TSMC size impact numerous of those companies will have to vanish at the same time.
- SnowProblem 3y agoFor more on TSMC's history, Acquired podcast's episode is incredible: https://www.acquired.fm/episodes/tsmc https://www.acquired.fm/episodes/tsmc
- lucasyvas 3y agoDid Buffet actually dump his stake as the article says? He must be completely convinced it will be seized because that seems like a silly investment to walk away from.
- gjsman-1000 3y agoWas news a few months ago. Kind of a bad omen.
- brucethemoose2 3y agoIt doesn't have to be siezed. There is a large incentive to sabotage it, which would effectively weaken Taiwan's independence without a war.
- hn_throwaway_99 3y ago> He must be completely convinced it will be seized If you've listened to Buffett talk about investing, probably not. He got to be the world's greatest investor by understanding risk and probabilities very well. He doesn't need to be "completely convinced", just convinced that the expected value of his shares won't be positive. Suppose he thinks there is, say, 25% chance of a takeover (which is definitely scary but far from 100%) - in that case his shares go to 0. He could easily think that the potential upside just doesn't outweigh that significant chance of a total wipeout.
- quickthrower2 3y agoKelly Criterion too.
- karmicthreat 3y agoIt can be something more than TSMC being seized. It could be that he sees TSMCs share of the market going down over the long term. Which it probably will. Many governments are pretty unhappy with dominance of TSMC. The US in particular is dumping some money out there to onshore chip manufacturing. It reasons that this will probably eventually result in some shifting in the market.
- consumer451 3y agoThe Acquired podcast on TSMC should be listened to, or the transcript read. One thing I learned is that TSMC is a sort of public/private partnership with the Taiwanese government. They put up 50% of the initial capital. > David: 50% by the government and the other 50% were owned by the investors. Morris got nothing. > Ben: And just got to keep his salary. > David: He was a government employee. > Ben: Wow. > David: There by the grace of the government. > Ben: Oh my God. > David: Isn't that unbelievable? This is so the opposite of Silicon Valley. > Ben: How is he worth $3 billion today? > David: Well, what he did—as TSMC started to work—he basically put all of his money into buying. He bought his own shares in the company. I don't know if it was privately. They went public on the Taiwan Stock Exchange in 1994, and then the New York Stock Exchange in 1997. But yeah, he put basically all of his excess cash flow into buying TSMC shares. https://www.acquired.fm/episodes/tsmc https://www.acquired.fm/episodes/tsmc
- raincole 3y agoThe most surprising thing was that during the late 90s, the government sold the absolute majority of its share. They really didn't think it was (going to be) an excellent cooperation.
- bloodyplonker22 3y agoCome on. They were typical politicians that never really understood technology. That does not seem surprising in the least bit.
- flangola7 3y agoTypical? In what sense?
- thinking001001 3y agoGood point! Taiwan is a political anomaly, an accidental offshoot that came about as a result of the rise of the CCP in China (people moved to Taiwan for refuge), and Taiwan has become enormously successful in an organic, unplanned way.
- hn_throwaway_99 3y agoWow, great article! > TSMC pumps out close to 60 per cent of the semiconductor chips used around the world and makes 90 per cent of the most advanced technology used in phones and laptops all the way to missile systems. I knew TSMC was dominant but not that dominant. Couple that with ASML in the Netherlands which makes the chip making machines, and I'm wondering if there has been any time in history when so much of our critical technology in our world has been concentrated in so few producers.
- astrange 3y agoASML has a few more layers of sole suppliers under it IIRC, they just don't get as much credit.
- _hypx 3y agoASML is the only provider of EUV lithographic machines. TSMC is just slightly ahead of Samsung and Intel at utilizing that technology. I honestly can't see how anymore puts TSMC above ASML.
- MichaelZuo 3y agoYeah this story doesn't make much sense. Intel and Samsung are only a few years behind TSMC, recreating ASML and their sole suppliers even within 10 years would be quite a stretch.
- WeylandYutani 3y agoASML is concentrated in a country that has been politically stable and uncontested for 80 years and doesn't seek the media spotlight. It is easy to overlook. Nobody really pays much attention to the Netherlands or it's non existing foreign ambitions and there is no state involvement in ASML. Basically no drama means no journalism.
- Namahanna 3y agoCarl Zeiss makes some amazing optics to allow it all to happen https://www.asianometry.com/p/how-carl-zeiss-crafted-a-house-of https://www.asianometry.com/p/how-carl-zeiss-crafted-a-house... To quote: To make these EUV mirrors, each 2 to 4 nanometer layer of molybdenum and silicon has to be deposited one by one. Fifty times, without fatal defects. After that, each mirror has to be painstakingly polished. The acceptable surface deviation metric is 50 picometers, or 50 trillionths of a meter. That is a staggering number. To put that into perspective. 50 picometers on a mirror that is 450 millimeters wide. If that 450 millimeter mirror was blown up to the size of the United States, 4,500 kilometers or 2,800 miles wide, then 50 picometers would be just 0.5 mm tall.
- ChatGTP 3y ago[flagged]
- qaq 3y agowhat about ASML?
- aeternum 3y agoIt's pretty crazy that this used to be Intel like 15 years ago. Can they not fab GPUs instead of CPUs?
- quickthrower2 3y agoCuda dominance would need to be solved. Or maybe make Cuda compatible chips?
- sudosysgen 3y agoThe chips are not the issue. It's the software. If you could convince NVidia to do it they could make CUDA compatible with their competitors.
- aeternum 3y agoI think there's a lot of truth to this, but from that angle, TSMC really isn't all that important. Much easier to strong-arm/guilt nvidia into licensing software and designs to intel to fab than it is to go to war with china over taiwan/tsmc for example.
- sudosysgen 3y agoAbsolutely, it's a market failure, not a genuine geopolitical issue.
- incompatible 3y agoIt seems unlikely to me, if China invaded, that the TSMC facilities would survive intact.
- CamperBob2 3y agoEven if they did, they certainly wouldn't keep running for long without Western support.
- mekster 3y agoWould the west leave it intact if China is about to take over the island?
- incompatible 3y agoPresumably, whichever side was losing would destroy it, it they were able. I wouldn't be surprised if the US also has a plan to evacuate skilled staff.
- mdp2021 3y agoAccording to Chris Miller (Chip Wars), the TSMC factories will be doomed in case of invasion. Reasons vary from intentional sabotage to disruption of maintenance (which is dramatically high in those factories).
- ggm 3y agoWater shortages in Taiwan. That impacts production. Earthquakes happen in the Taiwan Straights. That impacts production. Taiwan is not the bottom of the supply chain stack. You can guess where I'm going with this.
- mdp2021 3y agoThat machinery requires constant maintenance hence no disruptions... > You can guess where I'm going with this System fragility?
- ggm 3y agoYes. Both america and Europe want TSMC onshore. Oddly the US state winning the beauty contest has .. A water shortage!
- mdp2021 3y ago> Oddly the US state winning the beauty contest has .. A water shortage! Just amazing. But on > Water shortages in Taiwan. That impacts production that I now re-read: to the best of my understanding, water is not simply an impacter on production: it is critical for the survival of the factories, its machinery will break in its absence. It is brought to the factories through trucks, not just the rivers.
- ls612 3y agoImportantly very little water is actually consumed by the process of making semiconductors compared to how much water goes in, almost all of the water can be recycled or released back into the water cycle.
- kaycebasques 3y agoAre there any good resources on the culture of TSMC? What makes it so successful in this space? Or maybe it's not culture but something else?
- quickthrower2 3y agoTMSC makes all the Nvidia AI chips right? Also this made my jaw drop: It's responsible for 5 per cent of Taiwan's GDP, and 7 per cent of its electricity consumption.
- cyber_kinetist 3y agoIf you were surprised about that, note that Samsung is responsible for 20% of the South Korean GDP… (and Samsung Electronics taking up most of the revenue)
- strikelaserclaw 3y agoBut Samsung does so much more than TSMC i'm assuming. When i was in korea, i literally saw buildings with the samsung logo on them.
- futhey 3y agoIn Taiwan it's one of the controversial things that comes up every year when there are electricity shortages or water shortages; whether TSMC should get special treatment, or not.
- hollerith 3y agoTaiwan has electricity shortages? Huh.
- boomboomsubban 3y agoMost places have occasional electricity shortages when some power plant has some short term issue, but have a large connected grid that let's them get power from elsewhere. Ignoring all political difficulties that Taiwan might have doing that, they have a huge population on a tiny island 100 miles from anything else.
- eric-hu 3y agoThey have nuclear power plants but switched them off after Fukushima. Now they use coal and gas plants instead.
- lucubratory 3y agoThis is probably the most commonly repeated myth about a potential westpac war, that the PRC wants to get TSMC and the US wants to preserve access to it, and that's why there's an incentive for war and why there's this constant escalation between the US and China. I don't know why it's so popular among people who don't know the subject matter, but it is. If westpac goes spicy, TSMC as it exists today is toast. The US will bomb the shit out of it if they can't keep it, and probably target any personnel they can't extract from the island; there was recently a big kerfuffle in TW domestic politics over someone in the US saying so publicly. The PRC wants chip independence, but everyone involved in that discussion understands that if the PRC waved a magic wand and gained complete control of TSMC, it doesn't give them ASML, it doesn't give them Zeiss, and a lot of that technology and process won't necessarily be usable until there are domestic equivalents to those technologies, by which time it would probably be out of date. Reverse engineering manufacturing methods from a seized sample is incredibly, unbelievably difficult in the best of times, let alone for atomic precision mirrors and high-throughput miniature factories operated under high vacuum. More importantly, the PRC just isn't willing to go to war over chip independence; their bar for war is a lot higher than that. The reason the PRC wants actual control of Taiwan in 2023 and could credibly go to war to achieve it is the same reason they wanted actual control of the island from the years 1949-2023 inclusive, the same reason that the Taiwan government wanted actual control of the PRC mainland from the years 1949-1990: because they view the territory as rightfully theirs, taken from them by people who they hated, and perceived that there was a decent chance they could get it by force. PRC control over Taiwan would be the final chapter in the civil war that quite literally birthed the PRC - it has immense political and national significance and has been essentially a major goal and organising principle of the PLA and the PRC as a nation ever since the KMT retreated to Taiwan. It is not about trying to get access to new GPUs.
- dang 3y agoRelated ongoing thread: Interview with Shang-Yi Chiang, Former TSMC VP of Research - https://news.ycombinator.com/item?id=37185090 https://news.ycombinator.com/item?id=37185090 - Aug 2023 (4 comments)
- ngc248 3y ago>>> They weren't going to design a perfect microchip. They were going to design the perfect microchip factory. Its the "selling shovels vs digging gold" concept.
- mdp2021 3y agoThe Netherlands are smiling (ref. ASML) Update: sniper, speak up...
- aubanel 3y agoFunny thing I learned is that Taiwan actually needs Typhoons every year. The west coast of the island has many huge water dams (for instance, Baoshan dam), that are critical to sustain life and industry throughout the year. Each typhoon (tropical cyclones are called "typhoons" in West Pacific, and "hurricanes" in the US) that passes in the area brings about torrential rains, thus refilling the dams. And a year without typhoon means the freshwater reserves will go dry. Example of a recent shortage: https://focustaiwan.tw/society/202308070018 https://focustaiwan.tw/society/202308070018
- pfannkuchen 3y agoThey are tuned for this, but would they really have a shortage if the typhoons stopped and they retuned?
- kurthr 3y agoThey have droughts every 3-5 years near Taipei and during those droughts they regularly consider shuttering parts of Hsinchu Science Park where many of the largest fabs are are major users of water. They likely wouldn't turn off the newest fabs and might just run at lower capacity, but it's competing with farming and drinking water allocation. The dams don't hold that much capacity. https://www.npr.org/2023/04/13/1169462995/taiwan-makes-tough-decisions-as-it-faces-its-worst-drought-in-nearly-a-century https://www.npr.org/2023/04/13/1169462995/taiwan-makes-tough... Note that there was also a drought 2 years ago: https://www.nytimes.com/2021/04/08/technology/taiwan-drought-tsmc-semiconductors.html https://www.nytimes.com/2021/04/08/technology/taiwan-drought...