Moon of Alabama Brecht quote
February 08, 2021

U.S., Taiwan Manipulate Chip Supplies To Press For War With China

The current government of Taiwan is trying to break the U.S. and Europe's One-China policy to become an independent country under U.S. and NATO protection.

The Peoples Republic of China, the mainland, insist, historically correct, that Republic of China, Taiwan, is a part of mainland China.

Since 1972, when Nixon went to China, the U.S. has supported that position:

In the case of the United States, the One-China Policy was first stated in the Shanghai Communiqué of 1972: "the United States acknowledges that Chinese on either side of the Taiwan Strait maintain there is but one China and that Taiwan is a part of China. The United States does not challenge that position."

The ruling Taiwanese nationalist Democratic Progressive Party under President Tsai Ing-wen's leadership now has a plan to break that policy. Despite regime change in Washington DC it has support from U.S. anti-China hawks:

[Taiwan's Representative to the US] Hsiao’s invitation to Biden’s inauguration, taken together with Blinken’s language at the confirmation hearing, indicates that the Biden administration is willing to adopt a large chunk of the Trump administration’s Taiwan policy.

While in office, Pompeo pushed back against China and acted as a guarantor to Taiwan — Beijing viewed him as an outright enemy.

Through well planned economic development policies Taiwan has achieved a near monopoly in the production of computer chips. There were until recently three companies which could mass produce computer chips with the most tiniest structures. Then the U.S. company Intel screwed up its development of a production process for 7 nanometer chips. It is now at least two years behind the competition. Its newest chips are no longer the most powerful in the market. The CEO and the technical leadership have since been fired but it still will take years, if ever, to regain the leadership. A second big production facility is owned by the South Korean Samsung conglomerate. It is mainly used to produce the chips for Samsung's own products.

The third and by far biggest producer of chips is the Taiwan Semiconductor Manufacturing Co (TSMC). TSMC does not produce consumer products. It manufactured, until recently, for everyone in the global industry. It is the go-to producer for high-end chips other companies need. It has now become a weapon in the hand of the Taiwanese government.

Under pressure from Trump, who put sanctions on Chinese companies including Huawei, TSMC reduced its sales to China. It also had to commit to open a production facility in the U.S. Trump's use of the chip production capacities as economic and political weapon has given the government of Taiwan new ideas:

Taiwan’s role in the world economy largely existed below the radar, until it came to recent prominence as the auto industry suffered shortfalls in chips used for everything from parking sensors to reducing emissions. With carmakers including Germany’s Volkswagen AG, Ford Motor Co. of the U.S. and Japan’s Toyota Motor Corp. forced to halt production and idle plants, Taiwan’s importance has suddenly become too big to ignore.

U.S., European and Japanese automakers are lobbying their governments for help, with Taiwan and TSMC being asked to step in.

The ongoing pandemic first led to a slump in consumption. Car manufactures lowered their sales target numbers and their orders for new chips. But soon chip demand increased for products needed to work from home. When the car demand came back TSMC told the car manufactures that there was not enough capacity to produce chips for them. Whether that explanation for the current shortages is really true is questionable:

The auto industry’s pleas illustrate how TSMC’s chip-making skills have handed Taiwan political and economic leverage in a world where technology is being enlisted in the great power rivalry between the U.S. and China -- a standoff unlikely to ease under the administration of Joe Biden.

Taiwan’s grip on the semiconductor business -- despite being under constant threat of invasion by Beijing -- also represents a choke point in the global supply chain that’s giving new urgency to plans from Tokyo to Washington and Beijing to increase self-reliance.

It takes some ten years to build a new chip fabrication facility. The investment necessary for an up-to-date 'fab' has steadily increased and is now more than $10 billion. While the U.S., Japan and Europe have recognized the danger of a chip production monopoly it will take quite some time before they can become less dependent on TSMC.

This gives the Taiwanese government a window of several years to use TSMC for strategic purposes:

“Taiwan is the center of gravity of Chinese security policy,” said Mathieu Duchatel, director of the Asia program at the Institut Montaigne in Paris. Yet while Taiwan’s status in the global chip supply chain is a “huge strategic value,” it’s also a powerful reason for Beijing to stay away, said Duchatel, who’s just published a policy paper on China’s push for semiconductors.

Assuming Taiwanese forces were to be overwhelmed during an invasion, “there is no reason why they would leave these facilities intact,” he said. And preserving the world’s most advanced fabs “is in the interests of everyone.”

For all the moves to reel back domestic chip fabrication, it’s optimistic to think the supply chain for such a complex product as semiconductors could change in short order, Peter Wennink, ASML chief executive officer, told Bloomberg TV. “If you want to reallocate semiconductor build capacity, manufacturing capacity, you have to think in years,” he said.

China has threatened to invade Taiwan should it declare independence. But as long as it depends on Taiwanese chips it can only do that while also damaging its own industries. Still there is little doubt that China would be willing to take that risk:

The Chinese government said Wednesday that actions like its warplanes flying near Taiwan last weekend are a warning against both foreign interference in Taiwan and any independence moves by the island.

Asked about the flights, Zhu Fenglian, a spokesperson for China's Taiwan Affairs Office, said China's military drills are to show the nation's resolution to protect its national sovereignty and territorial integrity.

"They are a stern warning against external interference and provocation from separatist forces advocating for Taiwan independence,” she said at a regular briefing, giving the Chinese government's first official comment on the recent flights.

Taiwan thus still needs protection. But as long as the U.S. and others still adhere to the One-China policy it is unlikely to get sufficient support. The plan then is to use Taiwan's chip industry to press others into guaranteeing it military support:

Wang Che-jen (汪哲仁), an assistant research fellow at the government-funded the Institute for National Defense and Security Research (INDSR), said in a recently published paper that the current shortage of automotive chips has highlighted Taiwan's strategic place in the global semiconductor industry. The shortage shows that the supply chain for such products has become a matter of diplomatic, security and strategic concern, Wang said in the paper, titled "Automotive chip shortage: A look at Taiwan's strategic place in the semiconductor supply chain."
...
The American and Japanese governments, for example, have invited Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chipmaker, to build facilities in their countries, he noted.

Wang, however, warned against such a move, saying that while it may help to shorten the global supply chains, it may also weaken Taiwan's strategic advantage in the semiconductor industry.

"For Taiwan to maintain its 'silicon shield,' it needs to persuade the European countries and the U.S. that keeping TSMC in Taiwan is the best option," he wrote.

The concept of a "silicon shield" describes Taiwan's strategic position in the technology supply chain as a shield against any attack by China.

The blackmailing through chip supplies is not just an academic concept. The Taiwanese government is now openly using chip supplies to press other governments into economic and political concessions:

Taiwan's high-tech chip foundries are some of the world's biggest and most advanced, and so European car manufacturers have been reaching out to Taipei for help.

"Our government and chip manufacturers are mulling how to assist them," Minister of Economic Affairs Wang Mei-hua told reporters on Thursday.
...
Wang said she spoke to industry representatives on Wednesday, including Germany's de facto ambassador to Taipei.

She said she hoped Europe would help Taiwan obtain vaccines for the coronavirus.
...
"We need other countries to help Taiwan acquire vaccines, especially for medical workers as a top priority," Wang said.

"I told the German representative yesterday that we can help them acquire automotive chips to solve the problems facing the auto industry and we hope they can do what they can to help Taiwan acquire vaccines," she added.

Vaccine blackmail is one thing.

Nick Siemensma @nicksiem - 6:05 UTC · Feb 6, 2021

Taipei openly offering a quid pro quo to Germany. Is vaccine a fair price? Taipei turned up its nose at Fosun-manufactured supply of the Pfizer-BioNTech vaccine, so perhaps Germany can offer something more. And was no similar exchange of favours available to the USA?

The exchange with the U.S. is about much bigger things than vaccines. To press for political support that involves a potential war with China is on a different scale. Still the ball seems to start rolling:

The Daily Mao @TheDailyMao - 8:58 UTC · Feb 4, 2021

8/ Up until 2020, US tech-economic strategy was mainly to profit off the Chinese market. But after the COVID shock, that's shifted: the US now wants to bleed out the Chinese economy and specifically cripple Chinese tech companies with semiconductors

9/ In terms of bleeding out the Chinese economy, autos are where it starts. My TSMC source tells me they have been asked by the TW/US govts to prioritize chips for auto plants outside China and for US/JP carmakers, to punish the EU for the #CAI

10/ Yesterday, he mentioned that his TW govt counterpart was literally 'trying to stifle a smile' when he told her some of TSMC's Chinese customers in auto would have to shut down because they weren't getting enough chip supplies.

11/ But this isn't just some sort of 'happy accident' that a 'free market' will fix. TSMC does not have carte blanche to expand capacity as much as it wants. The market is not allowed to function in this instance... thanks to the TW regime.

12/ He has disclosed to me that the DPP has been using enviro regulations and other methods of pressure to keep TSMC from expanding its facilities 'too fast' - the TW regime seems to want an artificial shortage of chips to give them greater leverage in international negotiations

13/ And again, this is done in collaboration with the US government - to make sure 'every planned production line that comes online is instantly filled with US orders only.'

This is what was agreed upon between Tsai, Krach, and Morris Chang...

14/ ...and maintaining these artificial shortages to hurt companies producing in China are what Tsai means when she talks about restructuring the global supply chain away from China.

15/ As you may already have guessed, the EU is not happy about this arrangement. Besides the surface issue of their automakers being caught in an undeclared trade war, the EU also feels deeply betrayed by Taiwan's regime over this issue.
...

Please see the linked thread for more details and supporting sources. 

This Taiwanese and U.S. brinkmanship make a war with China more likely and put it nearer than I had previously thought. This summer the situation could already become critical:

The Daily Mao @TheDailyMao - 18:05 UTC · Feb 5, 2021

BREAKING: The DPP of Taiwan has privately indicated to the US it might back an independence referendum in August of this year

In an interesting coincidence this summer will also see some European forces deployed to the South China sea:

In an interview with the Sydney Morning Herald on November 2, German Defense Minister Annegret Kramp-Karrenbauer declared that her country  will dispatch a frigate to patrol the Indo-Pacific from next year.
...
Her remarks comes two months after Germany became the second European Union member to release guidelines for the Indo-Pacific. France’s foreign ministry released a strategy document in 2018 for the Indo-Pacific, following a major policy speech by President Emmanuel Macron in Australia earlier that year. A subsequent French security strategy for the region was released by the country’s defense ministry in 2019.

The Brits, now a mere U.S. proxy force, also join in:

Japanese and British foreign and defence ministers on Wednesday began a meeting via videoconference to affirm stronger security cooperation amid China's growing assertiveness in the East and South China seas.
...
The ministers were also expected to agree to work closely on Britain's plan to dispatch an aircraft carrier strike group, centred on the Queen Elizabeth, to the western Pacific for joint naval exercises with the Japanese Self-Defense Forces, the officials said.

Japan welcomes the dispatch of the Queen Elizabeth, Britain's largest warship commissioned in 2017, as it shows the country's strengthened commitment to the Indo-Pacific region, they said.

From the U.S. perspective a conflict with China as soon as possible is preferable to one in later years after China had time to build its capabilities.

It may therefore well be that the U.S. is pushing Taiwan into an summer independence referendum while both use the chip supply issue to press 'allies' into supporting them in a potential war.

Posted by b on February 8, 2021 at 18:16 UTC | Permalink

Comments
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@ Posted by: Observer | Feb 9 2021 12:37 utc | 93

The problem with Taiwan is that the USA officially doesn't recognize its independence (it adheres to the "One China Policy", even though it doesn't act like it in many cases). Crimea at least has the blessing of the USA and support from many important members of the UN (mainly from the EU nations).

The only countries that somewhat recognize Taiwan as a nation are mostly micro-nations over which the Vatican, for whatever historical reasons, still has influence. The Church (Vatican) has a long history of anti-communist operations - specially after their plans to convert China to Christianity through missionaries failed - since the post-war period.

Posted by: vk | Feb 9 2021 13:27 utc | 101

Posted by: Observer | Feb 9 2021 12:37 utc | 93,

This is typical textbook display of the west's DOUBLE STANDARDS. They don't dare to apply the same to Quebec/Canada, Catalonia/Spain as well as Scotland/UK and so many others.

The west, especial anglo five, should be called Shameless Double Standards Cultural Circle.

Posted by: LuRenJia | Feb 9 2021 13:31 utc | 102

@James 74. All my motorcycles run carburettors.

One of them is a rare Honda race bike. Carburettors wear and the parts have long been discontinued although some seals, float valves etc are available as is a diaphram reconditioning service. A second hand set costs 1000 euros, if I can find a pre owned set for sale or I can by some Keihin Flatslides for more than double that. They will give me 8 bhp more at peak power. Setting them up takes hours and needs a dyno and even then changes in the barometric pressure will alter their performance as will the humidity and ambient temperature.

The ignition is eighties technology, two large and clunky boxes which can be replaced for a modern set up for 200 Euros. Still much better than points and all that paraphenalia.

The car on the other hand...Always starts and runs exactly the same in all conditions, that single rail computer controlled diesel engine really is the bollocks!

I bought a Chinese diagnostic computer, invaluable for correcting the ‘ faults ‘ caused by dodgy sensors fitted all over the vehicle but so far, apart from overly enthusiastic oil services and the replacement of consumables, it doesn’t give me any trouble.

Posted by: Beibdnn | Feb 9 2021 13:32 utc | 103

Cyril @85

"I am not joking when I say that China is accelerating in the semiconductor manufacturing race. Two years ago, China was stuck at 28 nanometers. Now it is mass producing 14 nm chips. A move to almost 7 nm is nearly done. In a year or two, China will be making true 7 nm and perhaps even 5 nm chips, the leading edge."

Note that anything below 60nm or (perhaps) 45nm manufactured in China requires US technology and licenses. See the article in my link above. This explains Huawei having to divest its Honor cell phone brand and allegedly also consider selling its high-end brand.

Posted by: schmoe | Feb 9 2021 13:46 utc | 104

@ Posted by: schmoe | Feb 9 2021 13:46 utc | 103

I've read in the Global Times a while ago that Chinese researchers have already developed a method to build 12nm chips, but it was still not ready to go to manufacturing.

Either way, it is already outdated, as the Holy Grail right now is 3nm.

Posted by: vk | Feb 9 2021 13:56 utc | 105

Posted by: vk | Feb 9 2021 13:56 utc | 104


Either way, it is already outdated, as the Holy Grail right now is 3nm.

This notion that only the cutting edge in silicon is of any value is erroneous.

At 12nm Huawei can solve most it's telecommunications network equipment supply problems.

Entire families of *cutting edge* microcontroller, SoC and fpga solutions can be manufactured at 12nm and effectively substituted where 7 and perhaps 3nm is not yet available.

Equipment may be slightly bulkier, batteries may need to be bigger as well, but there's a lot of mileage in 12nm.

That mileage would be very helpful in getting down to 3nm...

Posted by: Arch Bungle | Feb 9 2021 14:41 utc | 106

Just to explain the situation: Taiwanese people are automatic full-fledged Chinese citizens. They don't even need to renounce their so-called "Taiwanese passport" in order to have a Chinese passport. All they have to do is to cross he strait (which is bridged)...
Posted by: vk | Feb 9 2021 13:22 utc | 99

strait bridged? scientific marxism, stating as existant, goal not yet attained?

google says -

"Is there a bridge from China to Taiwan?
China has completed a bridge to an island in the Taiwan Strait, a first step towards a potential highway to the self-ruling territory that Beijing is determined to reclaim. The ten-mile road and railway bridge to Pingtan is due to open to traffic this year.19/07/2019"

Posted by: tucenz | Feb 9 2021 15:25 utc | 107

Note that anything below 60nm or (perhaps) 45nm manufactured in China requires US technology and licenses. See the article in my link above. This explains Huawei having to divest its Honor cell phone brand and allegedly also consider selling its high-end brand.

Posted by: schmoe | Feb 9 2021 13:46 utc | 103

Do you think for a second China will give a flying fk on a rolling donut about US technology licences if this is the game US wants to play?

The divestments was to save the jobs and the know-hows like a reluctant mother putting her child on the last train out of the warzone. At the time Huawei naively thought the US pressure was against itself only. That the consumer mobile division and HiSilicon could survive the onslaught if it wasn't under Huawei.

But it was never against just Huawei, was it?

Posted by: A.L. | Feb 9 2021 15:29 utc | 108

Some people outside the industry may mistakenly assume that there is some magic and high alchemy involved in software development but that is not the case at all. It is just bricklaying, only with code. One of the biggest hurdles in software development is simply coming up with something worth the effort of all that bricklaying. The only reason the companies like Synosys and Cadence that daffyDuct @60 mentioned can dominate the niche they are in is because it has just never been worth anyone's while to develop a competing product and try to muscle into what remains a relatively small market. If it will cost you $10 million to develop a competing package and a license for an existing one will cost you $100,000 then it is a no-brainer.

China's problem with developing some technologies has not been the lack of the necessary magic but rather just the excuse to invest the time and resources, and the number one resource for this kind of work is engineers and scientists. Has anyone bothered to take a look at China's STEM graduate output lately? Figuratively speaking China has scientists and engineers standing on street corners with "Will innovate for food" scrawled on scraps of cardboard.

Just as America's sanctions on Russia were a godsend for that country's economic diversification, the Evil Empire's tech embargoes on China couldn't have come at a better possible time for China. Now instead of trying to find busy work for hundreds of thousands of engineers they have real meaningful tasks for all of those freshly minted STEM minds.

If America were not such a nation of small-minded and mean-spirited narcissists I would think they were deliberately trying to buff up Russia and China with some tough love.

Posted by: William Gruff | Feb 9 2021 15:35 utc | 109

Equipment may be slightly bulkier, batteries may need to be bigger as well, but there's a lot of mileage in 12nm.

Posted by: Arch Bungle | Feb 9 2021 14:41 utc | 105

Exactly my point. Cutting edge semi is only needed on halo product devices so "early adopters" can pay top dollar and become lab rat alpha testers.

Many institutions (govt, mil, med, etc) have a policy on N-1 our even N-2 hardware so they don't get caught out by the bleeding edge.

The biggest industrial use growth for cutting edge substrates (as opposed to lithography) is silicon carbide semi in electric vehicles. China will feel the pain and its products will be slightly inferior in efficiency until the gap is bridged.

Then again, China's growth was never built on halo products, it can certainly do without for a few more years, it won't be missed.

Posted by: A.L. | Feb 9 2021 15:44 utc | 110

There's lots of talk on blazing a new trail in photonic
chips, thus bypassing the conventional ASML technology.

https://inf.news/en/tech/50e0a3cbd36fb1adaabce64433cf62b0.html

Posted by: denk | Feb 9 2021 15:47 utc | 111

@Arch Bungle #3
You are incorrect.
TSMC was founded by Chinese engineers who previously worked for Texas Instruments. They aren't mainlanders in either cultural, citizenship or ideological sense.

Posted by: c1ue | Feb 9 2021 16:01 utc | 112

Posted by: LuRenJia | Feb 9 2021 13:31 utc | 101

This is actually worst than that. Don't forget that as we speak the leaders of the independence movement of Catalonia are either in prison or in exile. Also, none other of the trio you named has even dare to vote to secede from their host state, even if it came close in Quebec in 1995. I remember well seeing the Canadian deep state entering a shock-shelled state for months after 49.4% of voters in the Province unexpectedly supported Quebec separation (I was there). Watch out when Scotland Catalonia or Quebec threatens real seriously to pull away from the legacy federations they belong to. The real sticks will be shown to them.

All this make actually the double-speak you highlight even more hypocritical.

Posted by: KGB | Feb 9 2021 16:04 utc | 113

Posted by: denk | Feb 9 2021 15:47 utc | 110

Ha you beat me to it. China will catch up where it must on existing tech but when it smells an opening for a leap frog a-la 5G it will go for the jugular.

Posted by: William Gruff | Feb 9 2021 15:35 utc | 108

Exactly, the trap China walked into was naively assuming a level playing field when the MBAs made the build or buy decisions on various technologies.

Its not all bad as if China had decided to build everything from scratch it wouldn't be where it is today, certainly wouldn't have been able to pull 90% pop out of poverty during that time.

Building from scratch will make a touching story of perseverance, but only in an eulogy. Like it or not copying and/or buying is the quickest and most efficient way to get to second place. All scientific education starts with copying to leveraging on the minds before us.

The hard work to number one starts here.

Posted by: A.L. | Feb 9 2021 16:08 utc | 114

@b
I would add a little clarifying detail.
TSMC's processes are not the same as Intel's. I can't speak to 7nm or anything past 45nm, but in my direct, hands-on experience with previous semiconductor tech generations, the TSMC processes were 20-40% worse performance than Intel's.
Secondly, 7nm/cutting edge semicon products are used primarily for flagship products. The bulk of semiconductor sales used in everyday life outside of cell phone and computer CPUs do not employ anywhere near the latest generations of semiconductor tech. Automobile manufacturers in particular - again, based on my first hand experience prior to 2006 - took up to 4 years to proof a new chip before allowing it into actual production vehicles.
Lastly, TSMC and the Taiwan government.
It is difficult for me to see the Taiwan government forcing TSMC to do anything.
Does TSMC as a company believe in Taiwan as an independent country? I have never, in years of direct dealings with TSMC management and employees, ever heard of such a thing.
Thus while I can believe the government of Taiwan is trying to use chip shortages for its own benefit - it is neither clear to me that TSMC is deliberately shortfalling/slow rolling its production or that it is actively in collusion with the Taiwan government.
As for semiconductor chip shortages: the actual shortages are not at the high end. High end = 7 nm = 300 mm wafers.
The actual shortages are occurring at the mid/low end = 200 mm wafers. IoT sensors, modem chips, etc get manufactured here - and the capacity at 200mm is where the shortages are occurring. This capacity shortfall is entirely due to lack of investment: 200 mm was supposed to go away as 300 mm came online but it never did.
Exremetech writeup on chip shortages
You'll note from the article above that even at 200mm - it isn't that there is no capacity. It is that porting an IoT or modem chip design to a new fab/company is a very non-trivial process. It takes usually 2-5 iterations before acceptable performance and yield is achieved, and these iterations each take significant time (month+).

What shortages exist in the high end are entirely due to Intel: for whatever reason, Intel closed multiple fabs in the past few years. Intel's production capacity is what allowed them to crush AMD in the 2000 time frame; the decision to close those fabs in order to improve corporate balance sheet window dressing was clearly a very bad strategic error and more than cause for the Intel executive firings. Even then, the short term spike in demand due to WFH and its attendant gaming and home office sales spike is certainly a one-off.

So net net - I don't disbelieve that the Taiwan government is trying to use chip shortages for its own advantage.
I do disbelieve that TSMC is allowing this, much less actively assisting in the process.
But ultimately the chip shortages are much more likely a combined function of increased demand due to WFH and insufficient capacity at 200mm legacy fabs, not political shenanigans.

Posted by: c1ue | Feb 9 2021 16:20 utc | 115

@ Beibdnn | Feb 9 2021 13:32 utc | 102

you make a good point on the value of computers in vehicles.... i haven't driven motorcycle for about 20 years... i still have friends who do though...

Posted by: james | Feb 9 2021 16:22 utc | 116

@Mar man #2
Espionage skills are great and all, but you require the machinery to build a fab as well as the construction, production, design support and other skills.
This means Applied Materials and other company's products.
I can't say for sure, but I'm fairly sure that there are either hard or "soft" blockades in selling these machines to China.
Nor are they easy to duplicate. I've worked further down the supply chain but have been in cutting edge fabs and semicon production development labs - one such machine generated such a powerful magnetic field that it could hold a metal bar suspended midair so strongly that a person could not budge it.
Thus for China (or any other country) to create its own cutting edge fabs with minimal external support - it is necessary to create the tools, to create the tools, to create the production machines to populate the production lines. That ain't easy.

Posted by: c1ue | Feb 9 2021 16:25 utc | 117

A.L. 113

same thing in cars.
China is banking on EV instead of struggling to catch up on conventional piston engine technology,

Posted by: denk | Feb 9 2021 16:26 utc | 118

@34
Toyota pick up... "Un" /daesh model is a minimal electronic/mechanical vehicle... 😉

Posted by: Zynik | Feb 9 2021 16:36 utc | 119

@Paul #81
No, I am afraid not.
Japan's semiconductor manufacturers are in such a bad state that they all merged together into a single company to try and survive, badly.
They don't have the tech, they don't have the capacity, and they don't have the skills anymore. Significant chunks of their (old) machines were sold off to Korea or China even.
Semiconductor manufacturing isn't just throwing warm bodies at a Ford style production line. You need extreme control over the production environment - which Japanese do well - but you also need collaborative exploration of the process characteristics in conjunction with your customers - which the Japanese do very badly.
For example: you want to design into XX nm process of YY company. It isn't possible to just slap together a bunch of transistors into a blueprint to hand off to the production company. Every fab in a single company, much less fabs in different companies, performs visibly differently. This difference affects everything - not just a single transistor's speed (or worse, different transistors in different regions of the chip), but the clock speed of the timing regulator. The interface capacity of the pads connecting to the outside world. The power consumed and heat dissipated. The lifetime of the chip due to "hot electron", electromigration and similar effects. etc etc.
This all comes together into an extremely complex, multi-party interaction between semiconductor manufacturing equipment suppliers, the fab, the reference design and design rules team in the fab, the EDA software (chip design software) suppliers, the customer support team at the fab and EDA companies interacting with the customer, and the customer's own production and design teams.
A specific example: one customer wanted a minimum geometry resistor. TSMC didn't allow this because such a device is extremely inconsistent in manufacturing - it could be much bigger or much smaller depending on location. But the customer wasn't using it for anything digital - it needed something, anything that had a minimal resistance for the high speed comms chip they were designing. Many emails, meetings and arguments later, TSMC approved this previously illegal design just for this customer.
Now repeat this tens to thousands of times more...

Posted by: c1ue | Feb 9 2021 16:37 utc | 120

@ Zynik | Feb 9 2021 16:36 utc | 118

i have seen what isis drive, but i don't know what the model of it is called...

Posted by: james | Feb 9 2021 16:48 utc | 121

jiri @ 66, Well said. If China is going back to her not so distant past, that is how it will be.

Posted by: juliania | Feb 9 2021 17:02 utc | 122

Posted by: c1ue | Feb 9 2021 16:20 utc | 114

Yeah i agree TSMC isn't willingly marginalizing China when there's a buck to be made, for it actually moved heaven and earth in its production schedules to alet huawei stock up before the US ban came into force.

That's not to say they will not act when they see an opportunity i.e. Opening a new fab in USA in a deal probably full of taxpayer subsidies. Why they didn't just subsidize US player like TI or IBM (who still has cutting edge material science capabilities) is totally beyond me.

The Taiwanese govt on the other hand, is simply insane. Its use-by date is looming and its trying to sleep with anyone and anything to spite its own family.

Most of the Chinese fabs are 8 inch. There is a quality in quantity and China does quantity very well indeed.

Your experience with TSMC is bang on. Its a contract shop and it gets efficiency and yield via design standardization and an iron grip on processes. Unless you're a big enough customer, deviating from their standard design rules when you tape out will just get you a GTFO email. It's for the same reason their chips performance is lower when all else are equal.

See? we do agree sometimes... ;)

Posted by: A.L. | Feb 9 2021 17:34 utc | 123

@schmoe | Feb 9 2021 13:46 utc | 103

Note that anything below 60nm or (perhaps) 45nm manufactured in China requires US technology and licenses.

Somewhat true, because of inertia. China bought the US equipment years ago; that stuff can't be replaced instantly.

But the US gear will be replaced. In a few months, Shanghai Micro Electronics Equipment (SMEE) will be shipping 28 nm lithography machines containing zero US technology, and will go to 14 nm and 7 nm soon.

When I said that China was advancing on a broad front, I really meant it. Rapid progress is occurring simultaneously almost everywhere in the semiconductor field. People who think China is ten years behind have no idea how fast things can happen when one has the resources and the talent to pursue every avenue at the same time.

Posted by: Cyril | Feb 9 2021 17:47 utc | 124

Slightly OT but no one seems to be commenting on the announced joint China Russia Iran Pakistan naval exercises. Sounds like game over to me. Put a fork in The Empire, it is done.

Posted by: oldhippie | Feb 9 2021 18:05 utc | 125

@ Cyril 123.

Precisely. I saw in a recent discussion, I can’t remember where, that not only is China involved with the I.T.E.R. fusion project but also many different perspectives on fusion of it’s own.

Reading on the I.T.E.R. site a few years ago, I noted the experiment was being held back by real time computer calculation speed.

The leaders of the C.C.P. being educated in engineering disciplines will be aware of the benefits of the developement of Fusion on several fronts and I imagine also Thorium.

It will be interesting to see who actually has the first on grid Fusion reactor up and running and I wonder if the Chinese efforts to get ever more sophisticated chips is linked to this.

I wouldn’t bet against China in any area of technology.

Posted by: Beibdnn | Feb 9 2021 18:48 utc | 126

James @ 120:

Toyota Hilux small truck?

For years this was the most commonly stolen vehicle in Sydney. NSW police worked out cars of this model were being shipped out to the Middle East by gangs of Australians (of Middle Eastern origin). They were buying cheap shipping containers to send them off - because there were so many shipping containers available then, what with the fall in world trade as a result of the GFC in 2008 and continuing financial crises in various parts of the world.

Posted by: Jen | Feb 9 2021 18:51 utc | 127

@124 cyril

Thanks for the link. Last I heard, China is hoping for 20nm by 2023, but I am not sure if there should be any concern about no reference to a 45nm process being up and running yet. No question that resources are being dedicated, but China seemed to lack an organizational structure to pool resources.

Posted by: schmoe | Feb 9 2021 22:16 utc | 128

The fabrication of integrated circuits is a business that borders on the miraculous, but the one piece of the fabrication gear that's needed goes even beyond that, it's the lithography equipment.

There's only one company in the world - ONE IN THE WORLD - that can supply lithography gear capable of fabricating IC's down to 2nm using deep ultraviolet light source, that company is ASML in Holland, the ultra infra red source is made in the US by Cymer, a company acquired by ASML in 2013.

ASML holds the key to the new generation of ICs, unless China can figure how to put together a lithography set-up capable of a line width down to 5-3nm i.e. using a deep ultraviolet light source, the country cannot succeed in the fabrication of its own most advanced ICs around the 5-2nm lines width..

Moon of Alabama should look into ASML, the American Government is now putting pressure on the Dutch Government not to grant the company a licence to sell the deep ultraviolet lithography equipment to TSMC for fear, one can only guess, it can end up in mainland China.

Posted by: Baron | Feb 9 2021 22:18 utc | 129

Sorry for the error for 129 (Baron)

The light source is deep ultraviolet and not ultra infra red, apologies.

Posted by: Baron | Feb 9 2021 22:22 utc | 130

There is an old saying about not disturbing dragons. It would be a fools errand to stand in the path of China, if they steely-minded have decided that Taiwan must be "heim in Reich".
As someone else here cleverly pointed out: it is a pure chinese domestic problem.
Uncle schmul may huff and puff , but that is just about all they can do. A war with china, would call for the draft, and then they would have a civil war on their hands quicker than you can say "constitution". On paper the US has a mighty armed force, but paper is very forgiving. Face it : the US is in no condition, mentally, economically and militarily to conduct a major war against a peer opponent.
Now think about it: the US has not been in a worse shape than anyone can remember, it is divided politically, economically and racially. A declaration of war on China, would probably break up the United States.
And let's not forget the bear that is also slumbering: Russia! I cannot see them siding with the US, so they may very well side with mainland China, which means uncle schmul will have to accept a fait accompli.
And personally I could not care less, if it breaks the back of the US camel, well, glorious but if that is what the Chinese wants, all is good.
I know I am a cynic.

Posted by: Den lille Abe | Feb 10 2021 0:06 utc | 131

@ 129 Baron

What you post is true indeed. But is it relevant. Wars are not won by state of the art weapons I remind you: Russia WWII, the korean war, Vietnam war and finally the mess in Afghanistan. High tech on its own dont win wars.
People win wars, its simple. Ihope the Us has learnt from its long range of mistakes, but I doubt it. China is no Belize Islands.

Posted by: Den lille Abe | Feb 10 2021 0:17 utc | 132

re Hangar# 80 The numbers of Han settling in in what is now known as Taiwan were minuscule until the KMT gangsters fled there to escape the retribution for their murderous regime and it is exactly similar to Occupied Palestine where the few earlier settlers became the thin end of the wedge for a massive immigrant explosion from the late 1940's onwards.

Posted by: Debsisdead | Feb 10 2021 0:22 utc | 133

When I said that China was advancing on a broad front, I really meant it. Rapid progress is occurring simultaneously almost everywhere in the semiconductor field. People who think China is ten years behind have no idea how fast things can happen when one has the resources and the talent to pursue every avenue at the same time.

Posted by: Cyril | Feb 9 2021 17:47 utc | 124

We have to remember that historically China is good at throwing their infinite manpower at (mega) project and get it done. Science has always been a more collaborative effort Post-WWII especially computer science. Those raw manpower that China has adds up <>>real fast

Posted by: Hangar | Feb 10 2021 0:27 utc | 134

What shortages exist in the high end are entirely due to Intel: for whatever reason, Intel closed multiple fabs in the past few years. Intel's production capacity is what allowed them to crush AMD in the 2000 time frame; the decision to close those fabs in order to improve corporate balance sheet window dressing was clearly a very bad strategic error and more than cause for the Intel executive firings. Even then, the short term spike in demand due to WFH and its attendant gaming and home office sales spike is certainly a one-off.


Posted by: c1ue | Feb 9 2021 16:20 utc | 115

Now that Intel have an engineer CEO that not unlike AMD's Lisa Su, do you think they will reopen their older fabs? The thing with Intel is that it got infected by a disease that have bring down so many American company: financialization. By which I mean where a company lead by a bean counter CEO that done nothing but balancing the book to appease the shareholder, even at the cost of their core business. When Bob Schwann at the helm, he oversees the shitshow that is 10 nm and later 7nm following the same path. It's bafflinf to see news where Intel considered to go fabless beyond 7nm.

Posted by: Hangar | Feb 10 2021 0:34 utc | 135

Den lille Abe |


"Ihope the Us has learnt from its long range of mistakes,"

Mistakes? IMO none of their "wars" are mistakes. I actually resent them being called mistakes. It sound like "oops , I didn't mean to do that". Or we messed up there.

They have virtually destroyed every country they have invaded. That is intentional and certainly no mistake.

Posted by: arby | Feb 10 2021 0:43 utc | 136

@136 Arby

Whethter it was intentional or not, seen from our point of view it is best described as a mistake. I did not write "mishap" I wrote "mistake" please go look up
Please dont try to correct my use of the English language, "Cambridge English Dictionary"
will be of great help to you.
"mistake" has one meaning if it is viewed from your point , and another when viewed from any other point.
Ergo , what I have written is correct.

Posted by: Den lille Abe | Feb 10 2021 0:56 utc | 137

In what way was any of their aggression's a mistake? Name one that could be a mistake and in what way was it a mistake. I have seen not one that I would consider to be a mistake.

Posted by: arby | Feb 10 2021 1:20 utc | 138

@ 127 jen.............. thanks... interesting background info on all that too.. i doubt they are computer free.. maybe the original ones, but not the new ones!

https://en.wikipedia.org/wiki/Toyota_Hilux

Posted by: james | Feb 10 2021 1:35 utc | 139

Posted by: Debsisdead | Feb 10 2021 0:22 utc | 133

Please stop spreading false information. Although KMT brought a lot of people to Taiwan, the amount is still minority percentage-wise in Taiwan's population. Someone earlier has pointed out that there are two major groups in Taiwan after KMT moved there. The local one still takes the majority of it. A good amount of that part is also DPP's loyal base.

If you have any agenda with the false information, go somewhere else.

Posted by: LuRenJia | Feb 10 2021 2:04 utc | 140

"The Peoples Republic of China, the mainland, insist, historically correct, that Republic of China, Taiwan, is a part of mainland China."
or
The state of Israel, the center land, insist, historically correct, that "Palestine"(Judea etc) is part of original Israel.

Posted by: Antonym | Feb 10 2021 2:34 utc | 141

c1ue @112, re: "TSMC was founded by Chinese engineers who previously worked for Texas Instruments. They aren't mainlanders in either cultural, citizenship or ideological sense."

Not sure about that second sentence. As I pointed out @27 the founder of TSMC was originally from mainland China, growing up there till the age of 18, before going to the the US. In his own words, it sounds like his life in China shaped him:

I was born in 1931 into a middle-class family in China. And I lived in China until I was 18 years old, when I moved to the United States. So the early part of my life between birth and 18, the background was war, poverty, injustice. So those three things - war, poverty and injustice - they dominated the backdrop, the environment in which I grew up. War, first the Sino-Japanese War, then of course the Second World War, and then the [Chinese] Civil War. And I lived through all of them. China was so poor, most of the people were so poor, even middle class for me that I was born in. We didn't starve, we were not hungry ever, but our life style was very, very modest compared to a middleclass family lifestyle now. Injustice. Even back in those chaotic days of my youth, I could see and also read about people that were very rich and very powerful and indeed. I even saw, I even met some of them as a young person. But those were just in the very small minority and most of the people that I saw were also middleclass. They also lived very, very modestly and then there were a large number of people that simply didn't know where their next meal would come from. And people that didn't have adequate housing, I saw a lot of those people too. And so how did that background influence me? Well, first of all, I knew that war was just a terrible thing. I knew that abject poverty was also a terrible thing and injustice, social injustice."

https://www.semi.org/en/Oral-History-Interview-Morris-Chang


lulu @76, thanks for the reminder that the US-backed gangster Chiang Kai-Shek made off with China's gold, silver, cash, and precious artifacts! Wouldn't be surprised if his US advisors reminded him.

vk @91, thanks for that info about China's autonomous regions existing today because China's ethnic minorities chose to fight with Mao against the US-backed Chiang Kai-shek, and for that interesting info @100 too!

Posted by: Canadian Cents | Feb 10 2021 4:02 utc | 142

@ Antonym | Feb 10 2021 2:34 utc | 141... you forgot to mention the dance modi did with kashmir the past few months.... have to keep the nationalist agenda stoked..

Posted by: james | Feb 10 2021 4:12 utc | 143

@schmoe | Feb 9 2021 22:16 utc | 128

Thanks for the link. Last I heard, China is hoping for 20nm by 2023, but I am not sure if there should be any concern about no reference to a 45nm process being up and running yet.

You're welcome. If you hear that China is aiming merely for a 20 nm process by 2023, you should be listening harder. A lithography machine that can do 28 nm can automatically do 14 nm with multi-patterning. And China's looking at several ways to reach 5 nm by 2023; let's say mass production by '24 or '25. Fundamental physical limits may make 3 nm hard to reach, so China will have time to catch up to the leaders.

As for 45 nm, again you may not have been listening, as even late starter Huawei is almost there. As the article says, "it is not a matter of if but when China will build its own industrial chain".

Posted by: Cyril | Feb 10 2021 5:27 utc | 144

re LuRenJia @ # 140
No you piss off! Unlike you, I've been contributing propaganda free posts here since MoA opened in the early noughties.
I cannot help but notice that while you falsely accuse me of having an agenda, you deliberately avoid commenting on the treatment of Taiwan's indigenous population since Han began arriving in large numbers, you may contend that as many arrived between 1880 and 1895 (when Japan invaded), but up until that point indigenous Taiwanese had resisted invasion for more than two hundred years, so it can never be claimed Taiwan was part of China.

Initially Taiwanese welcomed Japan because they believed anything was better than China's continual failed (and bloody takeover).
While occupation by Japan was better for the indigenous population than China, foreign occupation was still foreign occupation.
Once the KMT invaded following the retreat of Japan, violent and ruthless oppression of Taiwan's indigenous population, the attacks upon Taiwanese were genocidal, to the point where now, Taiwanese only comprise 2.3% of the population .

If I have any agenda, it is the agenda of my lifetime to rid the pacific of all forms of imperialism, be it amerikan, englander, balanda (white Australians), french, pakeha (white people in Aotearoa), or Chinese.
Over the last 150 years all those aresholes have screwed over the people of the pacific and during the course of my life I have I have resisted Pacific imperialists by whatever it takes.

Sadly the ruthless treatment of indigenous Taiwanese , like the amerikan occupation of the Marshall Islands, Guam & all the other pacific nations it occupied & mistreated since WW2 hasn't backed off, tried to negotiate or made any concession to the indigenous population. These are the only pacific imperialists who have been so cruel and uncompromising - maybe the Indonesian occupation of East Timor was equally cruel, but we got rid of them, only to see them replaced by puppets of the Portugese who hide their thefts under the blanket of neoliberalism.

If you are one of those silly lefties who cling like shit to a blanket to the delusion, that neither Russia which admits it is far from a socialist state and China which doesn't, are somehow pure in intention, then you are the one with the agenda because you're cutting your dialectic to suit the situation rather than sticking to those humanist principles which can be the only certain way to ensure all get justice.

Politicians be politicians wherever; when there is a natural selection mechanism that sorts pols according to their skill to rise to the top, larger political entities (I.E. large population sovereign states) will always 'enjoy' political leaders who have been culled to the point where only the selfish, uncaring low lifes have survived.

I cannot see how forcing indigenous Taiwanese into a political structure guaranteed to deny them a voice isn't just as bad if its done by China, as the same deal for the people of Guam, where Amerika insists Guam is part of amerika and therefore all are amerikan citizens yet denies the people of Guam a vote for Prez, Senate or Congress or as bad as the cruel treatment meted out to the indigenous population of Palestine.

Posted by: Debsisdead | Feb 10 2021 7:22 utc | 145

Posted by: LuRenJia | Feb 10 2021 2:04 utc | 140

Please pull your head out of your arse and read a history book?

The fact is that mainland Chinese have pursued a steady and successful program of ethnic cleansing on Taiwan since the 17th century.

This is documented history.

Refute it if you can or shut up.

Posted by: Arch Bungle | Feb 10 2021 10:05 utc | 146

Posted by: c1ue | Feb 9 2021 16:01 utc | 112

Yours is not a statement of fact but of opinion.

Mine is a statement of fact not of opinion.

Posted by: Arch Bungle | Feb 10 2021 10:09 utc | 147

Anyone in this neck of the woods who enjoys music will have heard Kenny G's bittersweet Spring Breeze.
This is a 1933 Taiwanese tune of the same name, sung in Minnan ( Fujian) dialect.
The Japanese army co opted it into their military repertoire.
The point is: Nihon Teikoku ruled Taiwan at the tip of a colonial sword, not through rule of law, as someone has mentioned here before.
Taiwanese did NOT welcome Japanese occupation.
Resistance was fiercest especially among the aborigine tribes ( or more PC terms, nations), who were bloodily pacified over a long period.
From 17th C, the island was settled in increasing numbers by Ming loyalists who refused allegiance to the foreign Qing.
@145: I get your empathy for the weak brutalized by violent occupation, but Taiwan ranks low on that scale, in that earlier age.
@146: Would be interested in sources that claim mainland cleansed the island ethnically since arrival of Koxinga to island.
The swell of settlers post Civil War also came to escape Communist rule and retribution.
In both cases, it has been about loyalties, not identity.
Due to modern China's turbulent history, Taiwan and Hong Kong have developed strong local flavours.
These should be respected.
But Beijing is also as different from Shanghai as from Chengdu.
Some New York folk say that America really begins from New Jersey.
And let's not talk fringe stuff like Texit or Calexit.
Where does the independence thing end❓

Posted by: LittleWhiteCabbage | Feb 10 2021 11:19 utc | 148

#145 Debsisdead

As I understood it, Han Chinese colonization of Taiwan occurred during the Ming dynasty. But until you raised this issue, I was not aware that at least some historians say it happened because of the Dutch East India Company.

"In 1600, Taiwan was a wild land, inhabited by headhunters and visited mainly by pirates and fishermen. A hundred years later it was a prefecture of the Chinese Empire, home to a hundred thousand Chinese colonists. What accounted for this transition? How did Taiwan become Chinese?

Intensive Chinese colonization began abruptly in the 1630s, shortly after the Dutch East India Company established a trading port on Taiwan. The Dutch realized that their port’s hinterlands could produce rice and sugar for export, but they were unable to persuade Taiwan’s aborigines to raise crops for sale—most were content to plant just enough for themselves and their families.1 The colonists considered importing European settlers, but the idea was rejected by their superiors in the Netherlands. So they settled instead on a more unusual plan: encourage Chinese immigration. The Dutch offered tax breaks and free land to Chinese colonists, using their powerful military to protect pioneers from aboriginal assault. They also outlawed guns; prohibited gambling (which they believed led to piracy); controlled drinking; prosecuted smugglers, pirates, and counterfeiters; regulated weights, measures, and exchange rates; enforced contracts; adjudicated disputes; built hospitals, churches, and orphanages; and provided policing and civil governance.2 In this way the company created a calculable economic and social environment, making Taiwan a safe place for Chinese to move to and invest in, whether they were poor peasants or rich entrepreneurs.3 People from the province of Fujian, just across the Taiwan Strait, began pouring into the colony, which grew and prospered, becoming, in essence, a Chinese settlement under Dutch rule. The colony's revenues were drawn almost entirely from Chinese settlers, through taxes, tolls, and licenses. As one Dutch governor put it, "The Chinese are the only bees on Formosa that give honey.""

http://www.gutenberg-e.org/andrade/intro.html

Posted by: Fnord13 | Feb 10 2021 11:26 utc | 149

Den lille Abe (132)

One hopes and prays, Den, the Americans aren't stupid enough to start anything but contained regional wars at worst (even then there's a danger these may spill over become a world war), the 'wars' are now conducted by different means, destroying the enemy's economy with cyber tools.

In this respect the ability of China to solve the lithography bottleneck matters, they have to figure how to come up with a stepper (that's the older word for a photolithography gear) capable of drawing lines and gates down to 2nm, that's what the Dutch outfit has, to solve this is not an easy task, it took some 1st class brains years to figure. The IC's are now virtually in every 'box that ticks' from a simple and cheap calculating machine to a guided missile costing tens of millions, to be 2nd is to lose the game.

The other gear for the IC fabrication like diffusion, etching, slicing, software for designing the circuitry and stuff matters also, but that is not that critical, can be mastered quicker, deep ultraviolet light source equipment for the image transfer is the king, if China can come up with it within 2-3 years it would be close to a miracle.

You are right though, if it came to actual warring in the lands of the protagonists, people are indeed the top weaponry. Unfortunately China and Russia are both land powers, have few means of cracking the distances over the oceans.

Posted by: Baron | Feb 10 2021 12:50 utc | 150

Posted by: Debsisdead | Feb 10 2021 7:22 utc | 145

Not sure what your sources are. Apparently, it looks meant to provide support that Taiwan is NOT part of China. Is there a principle as to where can belong to whom? I can't think of any except that might rules. It's always he says she says. Even if that is the case, please use the same logic/rules to ALL, not selectively to specific interests.

Regarding what your described about Han group and the indigenous people, the nature of it is the conflict between migrants(Han group) and locals(indigenous people). Han people wanted the land and resources after they moved there. Indigenous people didn't want intruders. This happens in any similar situation. If applying your logic to usa, what would usa belong to?

Initially Taiwanese welcomed Japan because they believed anything was better than China's continual failed (and bloody takeover).
No, this is not the case and false. There were resistances when Japan took Taiwan. The last Taiwan governor from Qing Dynasty even declared independence with the intent to return to Qing later. However, Japan crushed the resistances bloodily. Is your source for this claim related to people seeking Taiwan independence or FaLunGong?


Posted by: Arch Bungle | Feb 10 2021 10:05 utc | 146

The fact is that mainland Chinese have pursued a steady and successful program of ethnic cleansing on Taiwan since the 17th century.

Since it is "documented", source, please?! I am not aware of steady programs of ethnic cleansing. Even if that is the case and it is successful as you said, there would be NO indigenous people at all in Taiwan today. Otherwise, it is not a success. In fact, there was a period that Qing dynasty prohibits the residents in Fujian areas to move to Taiwan after it took it back from Cheng regime there.

Posted by: LuRenJia | Feb 10 2021 13:46 utc | 152

"...I have resisted Pacific imperialists by whatever it takes."

The posturing and virtue signalling coming from this faux-left, middle class, baizuo poster is really thick here. He literally IS the imperialist in the Pacific, with the very land his middle class house sits on being stolen from indigenous peoples.

The poster's agenda is nothing more than the typical western middle class autoflagellation that arises from their "Identity Politics" religion-like mind poison (capitalist ideology's version of "Original Sin"). Because these middle class baizuo have thoroughly internalized capitalist ideology despite fooling themselves into believing that they are ideology-free, they are incapable of acknowledging that it is the economic system that provides them with comfort that is currently the cause of the world's ills; therefore, they have embraced the invented notion that racism and other forms of bigotry are the cause of hardship for large portions of the world's population. Capitalism is what provides them with their unearned comfortable lifestyles and status after all, and they pay it back by playing their role as the ideological firewall between that system and those whom capitalism doesn't afford such comforts.

I bring this up not to trigger anxiety in the particular poster, but rather to highlight a major problem in the West which is that many who profess to oppose imperialism are in fact ardent supporters of it. They simply redefine that "imperialism" to be something that they can safely oppose without any real costs to themselves or threat to the capitalist system that they support.

Posted by: William Gruff | Feb 10 2021 14:34 utc | 153

@Debsisdead #133
As LuRenJia noted - Taiwan did very much have significant Han presence prior to the KMT defeat. It just increased enormously afterwards.
It wasn't just "native" Taiwanese that the Japanese ruled in their term as overlords of that island...

Posted by: c1ue | Feb 10 2021 14:51 utc | 154

@Canadian Cents #142
You might keep in mind that China didn't turn fully Communist until 1949.
From 1931 to 1949 is...18 years. Morris Chang was born in mainland China, but mainland China from 1931 to 1949 wasn't the CCP controlled nation that it is today.
In fact, the timing of his "move" is almost certainly that his family was either KMT or closely enough aligned that they didn't want to stick around for the Commies. The fact that he was able to get into the US at that time is further indication that they weren't poor folk; only the rich and connected were able to do so.
Now, is Morris a fanatical anti-Communist? I have no idea.
But I will repeat: I have many years of direct interaction with TSMC. I have never seen any form of political leanings in any of their people. Certainly this could simply be because I was working with them in business - but it also means they have fanatical control because I've gotten really, really drunk with them and talked about all manner of things.
Their main concern with mainland China was the very real program of people and data poaching which the Communist mainlanders deployed against them. That's it as far as I heard.

Posted by: c1ue | Feb 10 2021 14:56 utc | 155

@LuRenJia #140
Debsisdead believes that anyone who disagrees with him must be a propagandist.
Furthermore his knowledge is not even close to as complete or correct as he believes.
I don't know about you, but I have direct, personal knowledge of the semiconductor industry, mainland China and Taiwan.
The KMT that fled to Taiwan was highly corrupt and incompetent.
The government of Taiwan - not at all clear they've improved on that base. The KMT fled to Taiwan with all of the government of China's assets that could be picked up and moved. They have furthermore been the recipient of literally generations of US economic largesse.

The very fact that Taiwan hosts cutting edge semiconductor fabs is proof: the US does not allow any other 2nd world or 3rd world nation to even buy the equipment - Taiwan was very much 2nd world/high 3rd world prior to its "economic miracle".

This economic miracle occurred because of the massive industrial offshoring from the US to the Asian Tigers, of which Taiwan was one, in the 1980s. And the 1980s movement was very much in response to Nixon's opening up of relations with China, Deng's reforms and the US deep state's desire to keep this Cold War opponent down.

I remember Taiwan in the 1980s - the traffic was literally hair-raising. Just imagine an entire nation of 18 year olds driving - traffic rules, whatever were just for suckers. I saw a women get hit by a car - at slow speed - and just dust herself off and walk away, it was so common.

Taiwan is relatively prosperous now after these decades of subsidies but far from clear how well they would do if the spigot were turned off. The 1980s era offshoring benefits have long since dried up - I rented an office space in a warehouse from a guy who went over to Japan and Taiwan in the 1980s to impart his industrial sewing expertise to the nascent cloth mills there.

Taiwan today has very little to offer internationally beyond TSMC. There are still major enclaves of serious economic backwardness; you can take a cab ride to the ports and get an amazing live seafood meal for very little. I used to take 3 or 4 of my engineer peers there where we could feast on fish, shrimp, abalone and beer for $50 total. The fish was deep sea - it literally had to be brought up in pressurized containers otherwise their bladders would pop.

Posted by: c1ue | Feb 10 2021 15:10 utc | 156

@Arch Bungle #147
Your lack of detail reveals that you just don't know what you're talking about here. At all.
This is a subject which I have direct, personal, hands on experience in.

Posted by: c1ue | Feb 10 2021 15:11 utc | 157

Debsisdead @ 145:

"...If I have any agenda, it is the agenda of my lifetime to rid the pacific of all forms of imperialism, be it amerikan, englander, balanda (white Australians), french, pakeha (white people in Aotearoa), or Chinese..."

Why stop with the racial bigotry, Debs? Maori themselves had very much imperialism with fiercer tribes cannibalizing the weaker ones. An ancestor of mine, who was white and a missionary, had success during one confrontation in placating the warmongering tribe with a peaceful haka that is carved on a ceremonial spear in a museum somewhere. My own grandmother, fairskinned and blue eyed, was raised maori and spoke maori, and she raised me; she had maoari blood. The happiest and most wonderful person I have ever known. (Her blood, which I am proud to say, runs in my veins, was from the northern tribe that produced maori royalty.
What am I then, an imperialist on both sides? I live on pueblo native American land and am grateful for the privilege. I had to pass muster with the chieftain here. I certainly don't feel like an imperialist, but if you say I am, I must be, along with all the other paleskins.

Posted by: juliania | Feb 10 2021 15:11 utc | 158

cyril @144

" If you hear that China is aiming merely for a 20 nm process by 2023, you should be listening harder. A lithography machine that can do 28 nm can automatically do 14 nm with multi-patterning. And China's looking at several ways to reach 5 nm by 2023"

Here is what I was referring to: " By 2023, SMEE wants to produce machines good enough for a 20 nm node, the report says. The upcoming scanners are said to use certain components made in Japan, but they don't use any ingredients from the USA. Link

Posted by: schmoe | Feb 10 2021 15:29 utc | 159

Posted by: groucho | Feb 8 2021 22:15 utc | 43

You fool. It has nothing to do with the Austronesians or 'inaccurate PRC claims'. The point is that the One China Policy is not an invention of the 'Mainland'. In fact, it was invented by the Nationalists after they fled to Taiwan in defeat. It was their way of screaming "The Chinese mainland still belongs to us!" even though they'd just been whuppped. In turn, the PRC agreed that there was indeed only one China -- and that they ruled it. So Taiwan can just suck it up now that the whole 'One China' thing is working against them--a situation that has pertained ever since Nixon realized that China meant, you know, the really big country, not the small island.

Posted by: Herr Ringbone | Feb 10 2021 15:32 utc | 160

Posted by: lulu | Feb 9 2021 4:58 utc | 72

US and UK didn't believe that China would dare to send in her peasant army without air force to fight the mighty US, UK and allied army. The rest is history.

I sincerely hope that the sane and true patriotic US politicians, government officials and arm generals, who truly care about American people and their beloved country, do remember the history and its lessons.

Otherwise, there will be nuclear war that is going to kill all of us.

You're absolutely correct, but also I fear your hope is forlorn. I have said before here that what will happen is that our Septard brethren, intoxicated by the power of their own bullshit, will forget what you have said and start a conventional war with China, accidentally or otherwise, and then promptly lose. At that point, they will detach from reality completely, spazz out, and, tears streaming down their uncomprehending Septard faces, go nuke. And that's the end of the human race.

All entirely contingent on a few unfortunate facts of geography and the powerful application of some elementary propaganda techniques for around 100 years.

The future didn't have to be that way. But that's what will happen.

The human race. Finished off by historically contingent bullshit. If the Seppos had been located close enough to Europe and got invaded properly half a dozen times, with massive loss of life, it might have been different.

Posted by: Herr Ringbone | Feb 10 2021 15:55 utc | 161

@ juliania... hopefully debs comes back to give you a response to you good question their!

Posted by: james | Feb 10 2021 17:25 utc | 162

The cutting edge chips of 7nm or 3nm may not be so easily available, but a lot of processing tasks can still be performed by older chips in cars and other items. 10nm and larger are still very useful in performing many tasks. As an example, I have 2 Xenon chips in my 6 year old computer, and it is by definition "older" technology, but still very capable and far from obsolete. So if all you have is a 2 sq. cm. chip to do the work of a new one sq. cm. chip, you are far from impoverished in what can be accomplished. Now this may sound simpleminded, but there are certainly work-arounds. Taiwan really is in a situation of diminishing returns with their approach. How long will any country tolerate that kind of blackmail? As the "covid" times demonstrate, all countries are re-learning the need for self-sufficency in critical areas and will work to correct that.

Posted by: Randy Nugent | Feb 10 2021 18:37 utc | 163

c1ue @155, yes I do not know what Morris Chang's political views are either, and only wanted to point out that Arch Bungle's statement @3 that TSMC was founded by someone from the mainland has a valid basis. The TSMC founder is a product of mainland China, the US, and Taiwan (to which he emigrated only at around the age of 54).

I don't think it's valid to assume that it "is almost certainly that his family was either KMT or closely enough aligned that they didn't want to stick around for the Commies". As he describes in the quote I included @142, China was in a time of great war and poverty when he left. The silent majority were probably not on one side or the other, but just trying to survive. As an 18 year-old male, he probably also was at great risk of being forcibly drafted into a violent war by one side or other. All of these were compelling reasons to jump at a chance to emigrate if the opportunity arose.

As far "only the rich and connected were able to do so", his words were "most of the people were so poor, even middle class for me that I was born in. We didn't starve, we were not hungry ever, but our life style was very, very modest compared to a middleclass family lifestyle now."

Apart from those points, we don't disagree and much appreciated reading your insights based on your chip industry experience!

Posted by: Canadian Cents | Feb 10 2021 19:29 utc | 164

"We didn't starve, we were not hungry ever, but our life style was very, very modest compared to a middleclass family lifestyle now."

This is just being economical with the truth. Even an upper class family in the 30s can be seen as modest compared to a middle class family's lifestyle of or today.

His quote above is just pure nonsense. It conveys nothing except in trying to subconsciously appeal to the readers empathy.

I'd say not starving and not ever being hungry in China in the 30s tells you all you need to know in the context of this discussion.

Posted by: A.L. | Feb 10 2021 20:40 utc | 165

@Canadian Cents #154
"Mainland China" prior to the Communist takeover is completely different than after.
Nor do you have any idea just how poor China was in that period.
The ability to emigrate to the US in 1949 - when literally tens and hundreds of millions of other Chinese are attempting to do so - is very different than parents scrimping to send their kids to school in the US in the 1960s or later, or of teenagers getting scholarships to attend school in the US - both of which were significantly abetted by anti-China policies in the US lending itself to money and visa benefits.
Perhaps you missed out that Morris attended Harvard university.
Any figure who attends that school is far more likely to be politically and/or financially connected than anything else.
So again, while I admire what Morris Chang has accomplished with TSMC - I have neither first-hand seen, second-hand heard or third hand read about any type of Communist or anti-Communist views being pushed.

Posted by: c1ue | Feb 10 2021 23:27 utc | 166

c1ue @166

张忠谋(Morris Chang) stayed only one year at Harvard. He transferred to MIT and received his degree in mechanical engineering there.

Even if 张忠谋(Morris Chang) is totally against communist China, still it does not change the fact:

He was born and educated in mainland China till he's 18-year-old.

his mother is the descendant of 徐时栋, famous book collector from Qing Dynasty.

Btw, he turned down the invitation to become a advisor to Taiwan government on Nov.22, 2016.

Since you are familiar with Taiwan, you surely know the vital role that Industrial Technology Research Institute (ITRI; 工業技術硏究院) has played in "transforming Taiwan's industries from labor-intensive into innovation-driven."

Its founder is 孫運璿 (Sun Yun-suan), born in Shandong, China, and got his Bachelor of Electrical Engineering from the prestigious Harbin Institute of Technology in China.

As minister of economic affairs from 1969 to 1978 and Premier of the Republic of China from 1978 to 1984, he was credited for overseeing the transformation of Taiwan from being a mainly agricultural economy to an export powerhouse.

Last but not least, Taiwan's take off is built upon the 115 tons of gold plus silver and $$$ looted from mainland China by KMT and the highly educated mainland Chinese, such as Sun Yun-suan, it brought to the island.

These facts are something pro-Taiwan supporters either do not know or are unwilling to give credit where credit is due.

Posted by: lulu | Feb 11 2021 1:24 utc | 167

Just look at the wording trickery put on wiki about 孫運璿 (Sun Yun-suan) :

Sun Yun-suan (Chinese: 孫運璿; pinyin: Sūn Yùnxuán; 10 November 1913 – 15 February 2006) was a Taiwanese engineer and politician. As minister of economic affairs from 1969 to 1978 and Premier of the Republic of China from 1978 to 1984, he was credited for overseeing the transformation of Taiwan from being a mainly agricultural economy to an export powerhouse.

Born and educated mainland Chinese who worked as ROC official = Taiwanese.

Posted by: lulu | Feb 11 2021 1:40 utc | 168

Posted by: c1ue | Feb 10 2021 15:10 utc | 156

Yup, TSMC is pretty much the only thing that is keeping the lights on in TW.

Ask any working class mainlander now whether they would want to immigrate over to TW for economic reasons and they will laugh in your face.

As for China's semiconductor industry, it will follow a similar development trajectory of other things China: Little of note when viewed from the outside for a while until it hits like a truck into the world all of a sudden.

Posted by: J W | Feb 11 2021 2:23 utc | 169

"As for China's semiconductor industry, it will follow a similar development trajectory of other things China: Little of note when viewed from the outside for a while until it hits like a truck into the world all of a sudden."

Posted by: J W | Feb 11 2021 2:23 utc | 169

Exactly.

10 years ago everyone and their dogs were writing off Chinese knock off smart phones.

5 years ago everyone was laughing off Chinese electric cars.

And when the world gets hit by the truck as you said, it's SOP to come up with ad hominem attacks and sanctions.

Its nothing new. Like dogs barking at the Chinese wagons as it rolls by but the caravan will continue moving forward.

Posted by: A.L. | Feb 11 2021 8:37 utc | 170

@lulu #167
MIT is not much less prestigious than Harvard - so I'm not at all clear that you made the point you wanted to make.
And that point was: a "lower middle class, not starving" 18 year old random Chinese is extremely, extremely unlikely to have been able to emigrate to Hong Kong, then the the US without some form of familial clout: political or monetary.
I also specifically pointed out that

The KMT fled to Taiwan with all of the government of China's assets that could be picked up and moved.

ITER is a decent organization - however - it is not clear to me at all just how much it contributes to semiconductor technology development outside of TSMC. I've always thought of it more as a feeder organization for TSMC's staffing as opposed to leading TSMC to ever greater technological heights.
Still valuable but not the same thing.

Posted by: c1ue | Feb 11 2021 14:47 utc | 171

@JW #169
I'm a lot less clear whether China's semiconductor industry can take over the leadership for the whole world.
People just don't get how expensive a fab is. It isn't just the outright cost - double digit billions - it is an entire ecosystem around it ranging from construction design, HVAC, materials, waste disposal, manpower - both raw and skilled, transport etc etc.
The entire United States - as the premier 1st world economy - can support roughly 1 cutting edge fab.
China is significantly poorer. They're starting from a lower base and have a higher population, but it is unlikely that China even 20 years from now could support 2 cutting edge fabs.
The reason there are multiple cutting edge fabs in the world is because of worldwide demand. Worldwide demand is largely sourced through a handful of multinational companies - Apple, Samsung, Intel, AMD and a few others.
Furthermore, these companies are already sourcing product.
For China to take over the semiconductor industry - they would not only have to be able to build the production facilities, they also would need to convince these large companies to build in China.
Even 20 years ago, there were concrete efforts to find ways to:
1) Prevent IP theft - in the 90s, we used to grind down competitor chips to see how they were set up. The same works today.
You can also seed spies into the fabs - between masks and other gear, there's all sorts of data that could be stolen which is even better than the above grinding/photo/analysis.
2) Prevent sabotage. The same processes to seed insider spies can also seed insider saboteurs. Insert a little logic here or there which if triggered, causes shutdown or burnout. The US military used to manufacture all its own chips - that is no longer true because of aforementioned economics. And if that is no longer true, it is absolutely not true for any other nation.
I haven't been working in the semiconductor field for some time but I do not think there are any real remedies in place still.
So: would foreign companies like Apple or Samsung trust its designs in a mainland Chinese fab? Either strictly business or touching on national security? Not clear.
Could Chinese methods create a fab which is fundamentally more economic/efficient than existing ones? Also not clear. The fab business is one of enormous scale: tens of billions investment has to be fueled by trillions of manufacturing flow.
The cost side of it is likely not nearly as important as the customer acquisition/management/flow side of it.
Who here thinks the Taiwanese are more anal than the Japanese when it comes to efficiency and cost management? I sure don't.
Yet TSMC smashed not just the Japanese near-East competition but everybody, everywhere.
There is a fab in Sarawak, Malaysia - talk about boonies and low cost (I've been there). Yet it flails mightily despite enormous PCB industry in that nation (in Penang).
Anyway, time will tell. Maybe China can develop its own manufacturing gear and tech sufficient to compete worldwide with ASML and AMAT, as well as the wafer production to compete with the Japanese, as well as source the myriad materials and what not to actually manufacture and corral the customers as well.
But maybe not.

Posted by: c1ue | Feb 11 2021 15:02 utc | 172

@Hangar #135
It is not clear to me.
Again, the surge in demand we are seeing now is entirely artificial: huge sections of the white collar work force are buying new computers due to WFH. My wife's company went WFH - their 30000 square foot office sits empty except for 1 receptionist, along with dozens to hundreds of mid-range laptops. These laptops aren't going to sit there unused forever - they will either hit the aftermarket and crush low end sales, or they will start getting used again and high end sales will crater (both for a cycle, not forever).
So no matter what, the surge in sales isn't going to continue and in fact is likely to fall below trend even in the near future.
Would opening more fabs make sense in that scenario?
I would think it more likely that Intel would look for ways to be able to outsource its lower end chips to external fabs. As far as I know, they still employ the same practices they used to: a manufacturing line basically creates the same chips forever until that design is totally end of lifed. Yes, minor changes are inserted but basically the same chip is made - the only difference are settings and price asked.
But at scale, it isn't clear to me that this is the best practice. If Intel gets superior performance (speed as well as power) in its own fabs, that's a premium added to its top end but not so much as the low end. Spending the money to port its older designs to other fabs would enable Intel to be able to switch old design production externally to maximize high end production - that still takes time but it is achievable whereas ramping up a new Intel fab or porting high end design to external fabs is horrendously expensive for the former and highly risky/possibly impossible to maintain standards for the latter.
The strategy would be similar to large tech companies and Amazon: they have internal data centers for baseload demand but use Amazon for peak periods.

Posted by: c1ue | Feb 11 2021 15:13 utc | 173

Posted by: c1ue | Feb 11 2021 14:47 utc | 171

My understanding is that Taiwan's ITRI is set up to help RND for Taiwan electric and electronic industries, primarily those in Hsinchu Scientific Industrial Park. If something at ITRI becomes mature enough, that will be tech-transferred to someone in Hsinchu Scientific Industrial Park (HSIP). ITRI is just next to Hsinchu Scientific Industrial Park. Additionally, two prestigious Taiwan universities NTHU and NCTU are also next to the industrial park and ITRI. NCTU(Hsinchu) is strong in EE fields and has very close relationship to companies in HSIP. The four are core parts of Taiwan semiconductor industries.

Posted by: LuRenJia | Feb 11 2021 15:31 utc | 174

Posted by: c1ue | Feb 11 2021 14:47 utc | 171
@lulu

For any real nerd here in the USA, MIT is much more prestigious than Havard. If your ambition is a cushy slot in the PMC-ocracy here then the "values" would be reversed. Despite the decline in Education here, I think that would still be the case, and I would add Stanford, UC Berkeley, and CalTech to the most pretigious Nerd schools, all better than Harvard.

IMHO.

Posted by: Bemildred | Feb 11 2021 15:43 utc | 175

Interesting discussion, thanks all.

Chip foundry map:

https://anysilicon.com/worldwide-location-wafer-fabs/

Posted by: the pessimist | Feb 11 2021 16:00 utc | 176

c1ue @172: "But maybe not."

The only way for the outcome to be "not" would be for the empire to immediately and completely lift all sanctions and embargoes on China in order economically undercut their efforts to complete the entire tech ecosystem domestically, and even that will just slow them down a little. China is not pursuing radical moves up the value added chain in response to American aggression, but rather for their own internal purposes. They simply want their own population to have better opportunities and quality of life. As threatening as Americans may find that to be it has nothing whatsoever to do with them. China is pursuing "Made in China 2025" regardless of what America chooses to do about it.

In 2018, the Chinese government committed to investing roughly US$300 billion into achieving the plan, In the wake of the COVID-19 pandemic, at least an additional $1.4 trillion was also invested into MIC 2025 initiatives. (Wikipropaganda)

China absolutely will reproduce the entire chip fab ecosystem whether it is economical to do so or not. Maybe it will take them twenty years to get every last part of that ecosystem in place and on the cutting edge, but that is only if we consider they started in 2010. China will be at the cutting edge with better than 90% of the process domestic in less than another five years.

China's efforts with MIC2025 have lots of moving parts that to western eyes just look chaotic. Of course you have seen the videos of subway stations in the middle of nowhere (yootoob) in China. One should instead focus upon the same development a couple years later (yootoob link) to better understand how the apparent chaos resolves itself into remarkable order seemingly overnight. A number of China's efforts at on-shoring of whole tech ecosystems has been in that apparent chaotic phase for years now. Some of those efforts, like China's commercial atomic power industry, have already achieved cutting edge. Like a supersaturated solution, the chip fab ecosystem is much closer to crystallizing into order than most western observers can imagine.

Posted by: William Gruff | Feb 11 2021 16:16 utc | 177

The foundry map shows nothing in Russia - this cannot be, right? They cannot be completely dependent on outside purchases for this essential product I would think. Came up with a 2019 article advocating moving below 28nm for Russian fabrication capability, but little else.

Posted by: the pessimist | Feb 11 2021 16:59 utc | 178

Posted by: the pessimist | Feb 11 2021 16:59 utc | 178

Foundries in Russia: that's a good question, I was wondering about that myself. I have read that all their military computer tech is integrated, built in and built custom, so not so useful to capture and reverse-engineer. It seems like a security issue to me, I was dumbfounded when our military started using commercial product everywhere (1990s).

Posted by: Bemildred | Feb 11 2021 17:12 utc | 179

@LuRenJia #174
I don't claim to be an expert - but I did have direct and working access to TSMC for multiple years including being managing joint R & D development in a number of key technologies such as optical proximity correction.
ITRI and other Taiwanese institutions had zero role in these relationships.
There is other external evidence that it is TSMC that drives ITRI etc rather than the reverse: there are actually other fabs in Taiwan than TSMC such as UMC. They are notably further behind; if ITRI et al were really providing the tech, the difference should be much less.

Posted by: c1ue | Feb 11 2021 17:21 utc | 180

@William Gruff #177
Building subway stations is vastly different than cutting edge semiconductor manufacturing.
As I wrote about in great detail - there is a lot required to do semiconductor manufacturing. Maybe China can replicate the expertise at ASML, AMAT; the wafer fab in Japan; the customer service and infrastructure dev and management of TSMC - but then again, maybe not.
The issue isn't just one of investment, control over land/law and will - it requires the participation and cooperation of a lot of people.
Huawei's growth, for example, is a credit to their management but they are still dependent on chips made by Broadcom, Qualcomm etc.
These companies in turn fab at TSMC and a number of other companies.
Re-creating leading edge semi equipment, manufacturing, customer relationships, IP etc is not something guaranteed for anyone no matter who they are.

Posted by: c1ue | Feb 11 2021 17:26 utc | 181

@pessimist #178
The map shows only public fabs - i.e. those which are owned and operated either by public companies or which offer their production services as fabless suppliers.
There are multiple military fabs that I know about which don't show - the Russian ones would fall in this category for sure.
There are also multiple fabs in Japan - the map only shows 1. It is true that some might have closed but I know for a fact that not all of them did.

Posted by: c1ue | Feb 11 2021 17:29 utc | 182

@ Posted by: c1ue | Feb 11 2021 17:26 utc | 181

From what I've heard, in a Silk and Steel podcast by Carl Zha, interviewing an American specialist on semiconductors industry, the Chinese don't want to repeat the mistake of the USSR, who created and dissolved industries by decree.

The Chinese are using the tried-and-tested Maoist strategy that won them the war in 1940-1949 (against Japan and the Nationalists, respectively): they only build something up when they make sure it can be self-sustainable. The semiconductor industry is an area that is only self-sustainable when produced in a very large scale, a scale that transcends even the Chinese domestic demand. Therefore, the CPC is first trying to set up the administrative and PR infrastructure to secure the market shares around the world, on to then go all in in building the technology and the industrial capacity sufficient to spark a cycle of innovations (road to 3nm chips).

Posted by: vk | Feb 11 2021 17:36 utc | 183

Posted by: c1ue | Feb 11 2021 17:21 utc | 180

I don't mean that ITRI leads TSMC or is involved in TSMC's RND. What I referred to is not TSMC or any specific company but the whole environment in general in Hsinchu Scientific Industrial Park. I am not sure how you got that impression.

If you looked at UMC history, it's related to ITRI. Morris Chang once led ITRI. TSMC is the leading company, but it is not the only one in HSIP. There are other companies that make other things in HSIP as well.

Posted by: LuRenJia | Feb 11 2021 17:40 utc | 184

I am guessing that requirements for many/most military and aerospace applications (extreme robustness and absolute reliability) would preclude use of leading edge chips, generally speaking. High speed computing in sheltered locations is another matter though.

Posted by: the pessimist | Feb 11 2021 18:40 utc | 185

c1ue @181: "The issue isn't just one of investment, control over land/law and will - it requires the participation and cooperation of a lot of people."

A lot of people? And cooperating? Darn, a big population that is raised from birth to value teamwork is the one thing that China doesn't have! And only just under 5 million STEM grads per year!

But then when you consider that more than half of America's half million STEM grads are international students, and more than half again of those are Chinese students, most of whom go home with their skills after graduation these days, maybe it will be enough? What do you think? Sure, Chinese companies don't seem to have as many clueless PHBs and useless and redundant project managers and evil marketing hacks as American corporations have, but maybe they can get by with a few less of those.

Posted by: William Gruff | Feb 11 2021 18:58 utc | 186

@William Gruff #186
Yes, a lot of people with experience and skill.
I don't care how many tens or hundreds of millions of TikTokers you throw at this problem - it won't get solved by brute force.
I actually know this area - it is abundantly clear that you do not.
Nor is it even a matter of brain power. The people making the machines today have decades of experience over multiple generations of semiconductor processes - that matters. The things that plagued manufacturers in the ruby lith era popped up again with 90 nm, for example.
Someone starting from scratch isn't going to have this capability.
If Chinese companies can do it, great, but I've watched them flail for 20 years now so I am more than a bit skeptical.
SMIC was created in 2000 and has gone nowhere. Shang Yi - the guy the TSMC people internally credit with getting them to where they are - recently got put in a major position of responsibility there so may turn SMIC around, but we will see if he can do so with the handicap of not having free access to Western tech like he did at TSMC
SMIC hires Chiang Shang Yi

Posted by: c1ue | Feb 11 2021 20:30 utc | 187

@vk #183
The Chinese are using that strategy because their previous ones have all failed miserably.
As I wrote above, SMIC was formed in 2000. They went on an expertise poaching spree but still failed to get anywhere in advancing Chinese semicon tech to even 3 generations behind cutting edge.
Nor is China unopposed in this area unlike when American politicians and executives allowed the red state manufacturing companies to be decimated by/bought out by/relocated to China.
So while the future is not set, I have seen 20+ years of China fail in the semiconductor area so I'm not speaking just out of speculation.

Posted by: c1ue | Feb 11 2021 20:34 utc | 188

@LuRenJia #184
I know what ITRI wants to think.
I also know what I saw with my own 2 eyes and direct personal experience.
Maybe things have changed in the past 10+ years since I switched to cyber security, but I doubt it. If ITRI were really that cutting edge, they would be creating the machinery for TSMC to use - when in fact AMAT, ASML etc still lead and dominate the industry.
Again, there is still great value in providing educated, skillful engineers and other personnel for TSMC and UMC.
That is not the same as leading edge research and development, however.

Posted by: c1ue | Feb 11 2021 20:37 utc | 189

c1ue | Feb 11 2021 (172)

From what you've posted, c1ue, it seems you know next to nothing about the IC business.

For starters, China's GDP in PPP dollars is about a third bigger than that of the US, funding a foundry would be no problem.

Why should everyone buying IC's from a Chinese IC fabrication company based in China be in China? Makes no sense.

The key isn't money but know how, and in particular know-how in lithography, that's the piece of gear that's hard to master in deep ultraviolet, but it's a must for pushing the line width down to 5-2nm, that's what will win it in the end, so far only one company is capable of supplying the lithography equipment for such feat, the Dutch ASML (above $200mn per installation), the Taiwanese TSMC is but one of its clients, TSMC it's a foundry business, it makes ICs for others from the design of others.

If the Chinese could have what ASML has they have a chance.

Posted by: Baron | Feb 11 2021 20:49 utc | 190

c1ue @187: "Yes, a lot of people with experience and skill."

Experience is great. "I've watched them flail for 20 years now". 20 years of flailing is pretty good experience. But the long history of incremental change also locks one into set patterns; of design, of thinking, of approaching problems. Such patterns develop a value of their own that is independent of their value for solving problems and cripple an organization's ability to embrace change.

As for skills, as a university instructor I will point out that the math department that I teach for would be shuttered without our international students, most of whom are Chinese. You cannot keep the engineering-level math courses open for the half dozen or less domestic students who sign up for them per term.

Basically, there are still some GI Bill greybeards left out there with some skills, but we have very few in the pipeline to replace them. This isn't going to take 20 years to impact development. The impact is hitting right now. That is why today's Boeing 737s fly themselves into terrain, for instance.

Posted by: William Gruff | Feb 11 2021 21:12 utc | 191

Addendum, re: chips: I mentioned change above, and organizations' ability to embrace it. VK offhandedly mentioned hypothetical 3nm nodes coming up sometime soon. At that scale we are talking gate widths and other chip features only a few silicon atoms wide, and of course you cannot build those features with pure silicon. It needs to be doped with much larger atoms, so we are talking features that may only be an atom or two wide. The physics of the Boltzmann equation breaks down at that scale and quantum effects dominate. A complete paradigm shift will be necessary to achieve and surpass 3nm, and it will require facility with quantum physics. The Chinese are already racing ahead with that.

As I said before, the timing of all of these changes guarantees that China is not only going to surpass the US, but leapfrog far beyond it.

Posted by: William Gruff | Feb 11 2021 21:40 utc | 192

@188 c1ue

Thanks for your comments. I do not work in the technology arena, but from what I have read commentators on this blog are way too pollyainish about the challenges China faces in semiconductors, as well as the magnitude of their error in allowing themselves to fall that far behind and the implications of being in such a compromised position.

Posted by: schmoe | Feb 11 2021 21:49 utc | 193

Fnord13 #149

Thank you, that seems to nail the question of the colonisation of Taipei since the 16th Century but seems to be totally ignored by some here. We can thank the Dutch East India Company for yet another genocide.

Here is the link again: http://www.gutenberg-e.org/andrade/intro.html

Posted by: uncle tungsten | Feb 11 2021 21:58 utc | 194

Silver was the prize.

From the excellent historical review linked by Fnord13 #149 and my last post:

[37] We can glimpse the structure of the new global trade by focusing on its most important commodity: silver. In 1637 a Spanish official wrote that "China… is the general center for the silver of Europe and Asia."66 Recent scholarship corroborates his view. During the sixteenth century, silver production and trade increased dramatically and, although the metal moved through a web of networks, most of it ended up in China. Indeed, China became a global "silver sink," drawing the metal from all over the world.67 So vast was China's demand that it may have affected major developments in Europe itself: "There would not have been a Spanish Empire in the absence of the transformation of the Chinese society to a silver base, nor would there have been the same sort of 'Price Revolution' (i.e., inflation) around the globe in the early modern period."68 China's thirst for silver shaped the pattern of global trade and colonialism and, what is most important for our inquiry, led to the colonization of Taiwan.

[38] Much of China’s silver was imported from Japan, which saw a tremendous increase in silver production during the sixteenth century. Taiwan lay directly athwart the trade route between Japan and southern China. The island therefore became a favorite meeting place for Chinese and Japanese traders, who were forbidden to meet by the Chinese government. The Dutch decided to settle on Taiwan for precisely the same reason: It was an ideal place from which to partake of the Sino-Japanese trade silk-for-silver trade.

[39] The Spanish, for their part, also became interested in Taiwan because of silver—not to buy it but to protect their own silver-trade routes. Spanish America was the world's largest silver producer, and nearly half of its silver went to China.69 The majority was shipped from Mexico to Europe and thence to China, but around 25 percent was sent directly across the Pacific Ocean, to the silver market of Manila.70 When the Spanish learned that the Dutch had settled on Taiwan, they feared (correctly) that their rivals would the new colony to disrupt trade between Manila and China. So the Spanish decided to occupy Taiwan at once, in the belief that they could thereby protect Sino-Spanish trade in Manila.

Posted by: uncle tungsten | Feb 11 2021 23:05 utc | 195

William Gruff #191

Thank you for that clarifying post. I see the same in the academic institutions in the bunya nut republic. For years they have been dependent on Chinese fee paying students. Since the moron John Dawkins became national Education Minister decades ago and the introduction of neo liberal economic acid was added to the mix, the educational capacity and rigor has been reduced to serve the elite. The national resource of intelligent individuals being given the opportunity to free tertiary education to excel in their own right has been denied. Hence high capacity students sponsored by other nations fill many of the courses. But the bunya nut republic has insulted its trading partner to the extent that the academy will empty and decline over the coming years.

Vale excellence.

Posted by: uncle tungsten | Feb 11 2021 23:20 utc | 196

@Baron #190
The real world of business works with world dollars - purchasing power parity dollars don't count.
Secondly, China may have a GDP on par in PPP terms, but its disposable wealth is still far, far lower. China per capita income is a bit under $5000 per year vs. Americans' disposable income of $46K plus.
This in turn means China's present and near future capability to sustain a modern wafer fab based solely on internal consumption is less than that of the United States or of Europe.
But thanks for chiming in with irrelevance.

Posted by: c1ue | Feb 11 2021 23:51 utc | 197

@William Gruff #191
I've never said Chinese were stupid. But intelligence isn't the issue here - it is experience, technology, capability and organization.
China has organization - it does not have the other 3.
So while you clearly admire the drive and intelligence of Chinese overseas students - this drive and intelligence does not automatically equate to results in such a rarefied field as cutting edge semiconductor manufacturing.
I don't wish China ill in its endeavors either, but this does not mean I am blind to the enormous challenges and lack of guaranteed positive outcomes inherent in trying to catch up on 40 years of development.

Posted by: c1ue | Feb 11 2021 23:55 utc | 198

@William Gruff #192
Your faith in technology and Chinese development is touching but sadly not consistent with actual results.
In pure science endeavors, China has achieved great results in a couple of areas. However, they have yet to demonstrate that same capability in advanced technology fields.
Semiconductors are like aircraft carriers. Anyone can slap some planes on a ship, but having them optimally functional and useable isn't the same thing.
Nor am I so blindly optimistic: I have worked with a lot of mainland Chinese.
One of the main characteristics I have seen is that the older ones often skate. In other words, the young Chinese really work hard but once they get into a more senior position, the work ethic drops off dramatically.
Again, this isn't conjecture. I've hired and managed teams in mainland China as well as conducted both business and marketing there.
What China has done well is infrastructure - the willingness to invest into improving it regardless of "profit".
They've done well in a few other areas, but there are plenty of areas where China is notably deficient including military technology (they lag the US and Russia by a wide margin), agricultural safety (Swine flu, coronavirus, H1N1 etc), corruption (guanxi), no doubt others.
China has done great in improving itself from when I first visited in the early 1980s - kudos. But neither China, mainland Chinese nor the CCP are superhuman.

Posted by: c1ue | Feb 12 2021 0:03 utc | 199

This chip war has hurt the CPU and GPU market deeply, along with the bitcoin mining. But it might in fact be better in long term as China strives to make their own chips and thus and get out of the AMD/Nvidia dualpoly.

Posted by: Smith | Feb 12 2021 0:42 utc | 200

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