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Devils Advocate: If there is no disruption in Taiwan, and TSMC continues to execute as it has, and Intel continues to execute as is has (not), then Intel might

by shaism 2y ago

Devils Advocate: If there is no disruption in Taiwan, and TSMC continues to execute as it has, and Intel continues to execute as is has (not), then Intel might go to $0 or survive only because of government subsidies and military contracts. NVIDIA, AMD, Apple and other companies seeking cutting edge performance will choose the most advanced node to stay competitive. Being the second best foundry has historically not been good business. This is an extreme scenario, of course.

bradleyjg 2y ago
Does TSMC have sufficient capacity in the works to satisfy all the demand for sota/near sota fabrication? People sometimes wonder why anyone is buying Boeing planes—it’s because it’s that or nothing. Airbus has no spare capacity.
- shaism 2y ago
  TSMC today has more than 60% of the foundry market share, and an estimated 80%+ market share for the leading edge. If you exclude Intel themselves (although they also use TSMC now) and Samsung, TSMC is pretty much the sole supplier to the leading edge. So, yes, TSMC has the capacity. Your Boeing / Airbus analogy hinges on multiple factors. First, Airbus and Boeing have comparable capacity. Second, they have comparable products. Both are not true when you compare Intel and TSMC. NVIDIA is heavily supply constrained. Why haven’t they sourced Intel or Samsung as second source? Historically, there are also many other issues with Intel operating as foundry. Do you think NVIDIA and AMD will be happy to send their CPU and GPU designs to Intel for manufacturing? Independence was one of the main drivers why TSMC was founded. To have an independent supplier who does not compete with its customers.
  - bradleyjg 2y ago
    It was a genuine question, I don’t follow the sector closely. That said to poke at your answer a bit: If nvidia is heavily supply constrained, wildly profitable, and strictly limited to TSMC doesn’t that dynamic lead to other customers being pushed aside? If so, doesn’t that open an opportunity for Intel if they can execute?

by shaism 2y ago

bradleyjg 2y ago

Does TSMC have sufficient capacity in the works to satisfy all the demand for sota/near sota fabrication? People sometimes wonder why anyone is buying Boeing planes—it’s because it’s that or nothing. Airbus has no spare capacity.

shaism 2y ago
TSMC today has more than 60% of the foundry market share, and an estimated 80%+ market share for the leading edge. If you exclude Intel themselves (although they also use TSMC now) and Samsung, TSMC is pretty much the sole supplier to the leading edge. So, yes, TSMC has the capacity. Your Boeing / Airbus analogy hinges on multiple factors. First, Airbus and Boeing have comparable capacity. Second, they have comparable products. Both are not true when you compare Intel and TSMC. NVIDIA is heavily supply constrained. Why haven’t they sourced Intel or Samsung as second source? Historically, there are also many other issues with Intel operating as foundry. Do you think NVIDIA and AMD will be happy to send their CPU and GPU designs to Intel for manufacturing? Independence was one of the main drivers why TSMC was founded. To have an independent supplier who does not compete with its customers.
- bradleyjg 2y ago
  It was a genuine question, I don’t follow the sector closely. That said to poke at your answer a bit: If nvidia is heavily supply constrained, wildly profitable, and strictly limited to TSMC doesn’t that dynamic lead to other customers being pushed aside? If so, doesn’t that open an opportunity for Intel if they can execute?