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> As long as back-channels exist to supply the chips to China, then there's less incentive for China to control Taiwan. The ban exists as good politics (we don'

> As long as back-channels exist to supply the chips to China, then there's less incentive for China to control Taiwan. The ban exists as good politics (we don't ship to our adversaries) while the back-channels ensure they aren't forced into a position no-one wants them to be in. Funny I was just literally thinking about this a few minutes before I opened this thread. I think the TSMC restrictions on China is really bad for Taiwan in the next few years. First, it’s a huge revenue loss for Taiwan. Second, it creates a scenario in which China would take military action on Taiwan if they fall behind too far in AI due to the lack of the most advanced chips. If I’m a Taiwan citizen, I would clamor for the government to negotiate with the US and Chinese government to allow Chinese companies to use TSMC fabs. It’s one sure way to delay military action.

dylan604 2y ago
> First, it’s a huge revenue loss for Taiwan. and whose capacity will be sacrificed to fulfill this lost revenue potential?
- aurareturn 2y ago
  I don’t understand what you mean by capacity.
  - dylan604 2y ago
    Capacity as in the amount of chips they can make. If they are already at max capacity, then which of their customers currently maxing out that capacity will be told no so that they can suddenly start producing chips for other people.
    - aurareturn 2y ago
      More demand will drive up prices. More demand will provide incentives to build even more fabs, which will further increase revenue. Also, TSMC's fabs are not at max capacity. It's only 70-80%.
frankacter 2y ago
>I think the TSMC restrictions on China is really bad for Taiwan in the next few years. First, it’s a huge revenue loss for Taiwan. TSMC sells more than it is capable of producing. This will likely continue to be a limiter for the foreseeable future. No revenue is being lost as a result of limiting export to China. >Second, it creates a scenario in which China would take military action on Taiwan if they fall behind too far in AI due to the lack of the most advanced chips. China's interest in Taiwan existed long before TSMC, it is ideological, not economical. >If I’m a Taiwan citizen, I would clamor for the government to negotiate with the US and Chinese government to allow Chinese companies to use TSMC fabs. It’s one sure way to delay military action. I am a Taiwan citizen and the majority of us don't want this, evident by the results of our recent election. That said, see prior point.
- aurareturn 2y ago
  TSMC sells more than it is capable of producing. This will likely continue to be a limiter for the foreseeable future. No revenue is being lost as a result of limiting export to China. First, TSMC's capacity isn't full right now. Second, if China relies on TSMC, they'd expand by building more fabs. Third, with more competition from China, they can increase the price of their nodes for all their customers. Fourth, China pushing harder to compete directly against TSMC because of this ban. China's interest in Taiwan existed long before TSMC, it is ideological, not economical. Agreed. I think China is willing to destroy the entire island to bring it back into control, which is not what's best for Taiwan people. I am a Taiwan citizen and the majority of us don't want this, evident by the results of our recent election. That said, see prior point. I guess there is a difference between what you want as a Taiwan resident and what I personally think is best for the island. I think Taiwan is being put as a sacrificial lamb almost by the US and I think it's in Taiwan's best interest to play to both sides more.
  - frankacter 2y ago
    >First, TSMC's capacity isn't full right now. Taiwan fabrication labs, where the most cutting edge tech is produced, are above capacity. This is the core of this discussion. They are building new fabs inside and outside of Taiwan to catch up to demand, but as of now those are one or more generations behind. To the rest of your initial statement, it starts with a flawed premise so not worth responding. >I think Taiwan is being put as a sacrificial lamb almost by the US and I think it's in Taiwan's best interest to play to both sides more. I am citizen, not a resident. Taiwan's position as the first chain island is it's primary strategic advantage to both US as well as other Asian neighboring countries in the region. Taiwan follows international law in effort to maintain and regain it's international standing. Taiwan maintains diplomatic and trade relations with China,but recognize that China is actively taking direct actions to limit Taiwan's political and economical relations and growth. Reliance on a hostile neighbor that continually reminds you they will force unification by military action if necessary is a losing game, and trusting carrots like "one nation, two systems" lost all credibility with the downfall of Hong Kong.
high_na_euv 2y ago
>Second, it creates a scenario in which China would take military action on Taiwan if they fall behind too far in AI due to the lack of the most advanced chips. What? Who goes to war for some chips that can be smuggled easily xd
- aurareturn 2y ago
  It's not just about smuggling. First, smuggling adds costs and risks, which makes Chinese AI companies less competitive. Second, China wants to design and manufacture chips on TSMC. They don't want to just buy Nvidia chips, they want to compete against Nvidia.
  - high_na_euv 2y ago
    >China wants to design and manufacture chips on TSMC. They want to design and manufacture themselves. >First, smuggling adds costs and risks Going to war does the same multiplied by 100? 1000?
    - aurareturn 2y ago
      >They want to design and manufacture themselves. Sure, but they want to rely on TSMC now so they don't fall behind in high tech in 2024/2025. Getting their own EUV tech is still many years away. >Going to war does the same multiplied by 100? 1000? Well, you know what they say, if I can't have it, you can't either.
      - high_na_euv 2y ago
        But US has Intels fabs, which will be around or at leading node (18A) in next 6-8months
        aurareturn 2y ago
        Yep. I own some Intel stock as a hedge.

dylan604 2y ago

> First, it’s a huge revenue loss for Taiwan. and whose capacity will be sacrificed to fulfill this lost revenue potential?

aurareturn 2y ago
I don’t understand what you mean by capacity.
- dylan604 2y ago
  Capacity as in the amount of chips they can make. If they are already at max capacity, then which of their customers currently maxing out that capacity will be told no so that they can suddenly start producing chips for other people.
  - aurareturn 2y ago
    More demand will drive up prices. More demand will provide incentives to build even more fabs, which will further increase revenue. Also, TSMC's fabs are not at max capacity. It's only 70-80%.

frankacter 2y ago

>I think the TSMC restrictions on China is really bad for Taiwan in the next few years. First, it’s a huge revenue loss for Taiwan. TSMC sells more than it is capable of producing. This will likely continue to be a limiter for the foreseeable future. No revenue is being lost as a result of limiting export to China. >Second, it creates a scenario in which China would take military action on Taiwan if they fall behind too far in AI due to the lack of the most advanced chips. China's interest in Taiwan existed long before TSMC, it is ideological, not economical. >If I’m a Taiwan citizen, I would clamor for the government to negotiate with the US and Chinese government to allow Chinese companies to use TSMC fabs. It’s one sure way to delay military action. I am a Taiwan citizen and the majority of us don't want this, evident by the results of our recent election. That said, see prior point.

aurareturn 2y ago
TSMC sells more than it is capable of producing. This will likely continue to be a limiter for the foreseeable future. No revenue is being lost as a result of limiting export to China. First, TSMC's capacity isn't full right now. Second, if China relies on TSMC, they'd expand by building more fabs. Third, with more competition from China, they can increase the price of their nodes for all their customers. Fourth, China pushing harder to compete directly against TSMC because of this ban. China's interest in Taiwan existed long before TSMC, it is ideological, not economical. Agreed. I think China is willing to destroy the entire island to bring it back into control, which is not what's best for Taiwan people. I am a Taiwan citizen and the majority of us don't want this, evident by the results of our recent election. That said, see prior point. I guess there is a difference between what you want as a Taiwan resident and what I personally think is best for the island. I think Taiwan is being put as a sacrificial lamb almost by the US and I think it's in Taiwan's best interest to play to both sides more.
- frankacter 2y ago
  >First, TSMC's capacity isn't full right now. Taiwan fabrication labs, where the most cutting edge tech is produced, are above capacity. This is the core of this discussion. They are building new fabs inside and outside of Taiwan to catch up to demand, but as of now those are one or more generations behind. To the rest of your initial statement, it starts with a flawed premise so not worth responding. >I think Taiwan is being put as a sacrificial lamb almost by the US and I think it's in Taiwan's best interest to play to both sides more. I am citizen, not a resident. Taiwan's position as the first chain island is it's primary strategic advantage to both US as well as other Asian neighboring countries in the region. Taiwan follows international law in effort to maintain and regain it's international standing. Taiwan maintains diplomatic and trade relations with China,but recognize that China is actively taking direct actions to limit Taiwan's political and economical relations and growth. Reliance on a hostile neighbor that continually reminds you they will force unification by military action if necessary is a losing game, and trusting carrots like "one nation, two systems" lost all credibility with the downfall of Hong Kong.

high_na_euv 2y ago

>Second, it creates a scenario in which China would take military action on Taiwan if they fall behind too far in AI due to the lack of the most advanced chips. What? Who goes to war for some chips that can be smuggled easily xd

aurareturn 2y ago
It's not just about smuggling. First, smuggling adds costs and risks, which makes Chinese AI companies less competitive. Second, China wants to design and manufacture chips on TSMC. They don't want to just buy Nvidia chips, they want to compete against Nvidia.
- high_na_euv 2y ago
  >China wants to design and manufacture chips on TSMC. They want to design and manufacture themselves. >First, smuggling adds costs and risks Going to war does the same multiplied by 100? 1000?
  - aurareturn 2y ago
    >They want to design and manufacture themselves. Sure, but they want to rely on TSMC now so they don't fall behind in high tech in 2024/2025. Getting their own EUV tech is still many years away. >Going to war does the same multiplied by 100? 1000? Well, you know what they say, if I can't have it, you can't either.
    - high_na_euv 2y ago
      But US has Intels fabs, which will be around or at leading node (18A) in next 6-8months
      - aurareturn 2y ago
        Yep. I own some Intel stock as a hedge.