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There are also a lot of geopolitical interests in helping Intel succeed. As much as investors might balk at Intel today, the amount of money that Western govern

There are also a lot of geopolitical interests in helping Intel succeed. As much as investors might balk at Intel today, the amount of money that Western governments can toss at the problem is effectively infinite. (Looking at Defense contractors as an example; horrendously inefficient, but tax revenue is effectively perpetually guaranteed to keep flowing.) It's silly to frame it this way, but even though the US and allies pay gobs for planes like the F-35, it's also what continues to allow the stream of taxable money to continue. I view Intel in a similar light. Even if they stay inefficient, there will still be money for a long time because the West needs a way to be self-sufficient. The cost of not having a backup is too high (tens of trillions of dollars when I last looked into it). It's a weird market that doesn't obey a lot of the conventional rules of capitalism. Yes, it would be better if Intel were able to compete without government subsidies, and maybe they will. But even if they don't it's very unlikely they'll totally crater because of how central this "power" is, and TSMC will never cede full control of their latest tech until the UN recognizes Taiwan as a distinct entity from China (imo).

bcrl 2y ago
However, subsidies always come with requirements for companies to fulfill. While it may sound great that Intel is getting billions of dollars in money to build and operate new fabs in the US, those fabs come with massive operating expenses. Unless Intel finds a whole lot of new product to run through those fabs, and soon, the subsidies could end up putting Intel in an even worse financial hole than it is already. Intel needs to change its internal culture to get back on a path towards success. I don't know if any CEO is capable of fighting and winning that battle within the span of a few years, and time is running out. Part of what impresses me about TSMC are some of the anecdotes that have trickled out about how they approach process R&D. TSMC runs experiments 24/7 with each team building on the results of the previous shift. This allows it to iterate much faster than many competitors. It is that kind of dedication and drive that Intel needs to push its leading edge manufacturing capabilities back into world class status, but that isn't the kind of change that can be achieved purely by throwing money at the problem.
XorNot 2y ago
The F-35 is actually an extremely affordable 5th generation fighter aircraft. It is cheaper per unit then some 4th generation aircraft now.
- michaelt 2y ago
  Yes, the F-35 costs just $34,000 per flight hour. That's much cheaper than, say, Pat Gelsinger whose total comp was $86,000 per hour in 2021.
- etempleton 2y ago
  Not to mention from the US Govt perspective it keeps thousands of people employed in well paying jobs and extends domestic expertise and capabilities.
rob74 2y ago
Well, the current US administration was committed to helping Intel succeed (https://en.wikipedia.org/wiki/CHIPS_and_Science_Act https://en.wikipedia.org/wiki/CHIPS_and_Science_Act), not so sure about the incoming one. Maybe that also played a part in the decision?
rolandog 2y ago
Exactly. It's a "too big to fail" with a touch of "what are you gonna do, let me go bankrupt?" situation.

bcrl 2y ago

However, subsidies always come with requirements for companies to fulfill. While it may sound great that Intel is getting billions of dollars in money to build and operate new fabs in the US, those fabs come with massive operating expenses. Unless Intel finds a whole lot of new product to run through those fabs, and soon, the subsidies could end up putting Intel in an even worse financial hole than it is already. Intel needs to change its internal culture to get back on a path towards success. I don't know if any CEO is capable of fighting and winning that battle within the span of a few years, and time is running out. Part of what impresses me about TSMC are some of the anecdotes that have trickled out about how they approach process R&D. TSMC runs experiments 24/7 with each team building on the results of the previous shift. This allows it to iterate much faster than many competitors. It is that kind of dedication and drive that Intel needs to push its leading edge manufacturing capabilities back into world class status, but that isn't the kind of change that can be achieved purely by throwing money at the problem.

XorNot 2y ago

The F-35 is actually an extremely affordable 5th generation fighter aircraft. It is cheaper per unit then some 4th generation aircraft now.

michaelt 2y ago
Yes, the F-35 costs just $34,000 per flight hour. That's much cheaper than, say, Pat Gelsinger whose total comp was $86,000 per hour in 2021.
etempleton 2y ago
Not to mention from the US Govt perspective it keeps thousands of people employed in well paying jobs and extends domestic expertise and capabilities.

rob74 2y ago

Well, the current US administration was committed to helping Intel succeed (https://en.wikipedia.org/wiki/CHIPS_and_Science_Act https://en.wikipedia.org/wiki/CHIPS_and_Science_Act), not so sure about the incoming one. Maybe that also played a part in the decision?

rolandog 2y ago

Exactly. It's a "too big to fail" with a touch of "what are you gonna do, let me go bankrupt?" situation.