There is a positive feedback loop in fab progress: the more customers you have the more yield experiments you can do, the better the yields get, the more customers you get. This explains why the number of leading edge fabs is decreasing, ending up with a monopoly:
The Chinese government wants it to happen and probably can make it happen, but it will not be easy. China would have to take the island by force and an amphibious invasion is logistically difficult and almost certain to face heavy casualties on both sides.
US and the west place a lot of strategic importance in Taiwan so they may come to the defense, but it is unlikely to be defendable for long.
We are seemingly moving towards another Cold War: China and Russia vs US and NATO.
The equipment they need to manufacture the latest chips is made by a Dutch company. The US has convinced the Dutch government to ban the export of that equipment to China. If China managed to gain control of TSMC they would loose access to that equipment.
Plus the US can trivially exfiltrate all the IP related to TSMC before China properly takes the island. Insiders will happily turn it over for any number of reasons.
The next step if China were to move on Taiwan, other than getting all the data and IP from TSMC's internal networks, would be to spin up a US division and assign that IP to that new corporation. And then the US should try to get as many of TSMC's employees to the US that they can.
The US didn't just convince them to, the US was a big part of the development of technology with a government/industry consortium in the late 90s (EUV LLC) with DARPA being a big part. That partnership worked with ASML under terms that are now letting the US have a big say in export controls.
Not gonna happen. Tibet will get lots of freedom fighters courtesy of Uncle Sam and Aunty Indira. Same will happen at Xinjiang with groomed mujahideen fresh from Middle East plus American weaponry courtesy of free gift left in Afghan. China now is riped for breakage as inscribe in 5000 years of belief. One of American strategy to reduce China dominance is to accelerate breakage to 7 pieces (Xinjiang, Tibet, HK, North China, South China, Inner Mongolia and Heilonjiang). Attack on Taiwan, will have all the CCP children in America under internment similar to American Japanese during WW2. Would any parents able to meekly ignore that? Kill the emperor and save your children is a persuasive slogan. An economic blockade on the sea front and devastating India recovery of the western Aksai with Heilongjiang getting eyed upon by Putin while Japanese reconsider Manchuria. Most Chinese soldiers now are product of 1 child policy with very weak will to fight. Furthermore a breakage of world biggest dam would enough to wipe off 1/4 of Chinese capability on political and economic front. And remember the last few years strange prophecies happening in China. One notable one is June snowing in Beijing. Pandemic occuring in China history also signaling a change of dynasty. All in all, it is extremely unfavorable for Chinese to do a Putin Ukraine invasion. Putin is incredibly bright. You can go watch some of Putin's speeches on Youtube. Current Chinese leader is widelynknown on China to be not that well educated (due to Cultural Revolution) and lack eloquence. In short, attempt to take back Taiwan by force will end the China that we know now. People will care more about GPUs and CPU than the lives and prides of Chinese people.
Russia tried joining NATO multiple times and was rebuffed - this is entirely on the west. Obviously China is the new global rival to be concerned about, not Russia.
It does not seem unusual that an organization (NATO) created solely to defend/protect against one particular country would not allow that country to join forces with them.
If the German successor state to the Third Reich could join the western alliance after WW2, why can't the successor state to the Soviet Union join? Russia as a white-majority christian country shares many values and culture with the others.
The western alliance has not only rebuffed Russia, it has expanded eastwards against promises made and thus provoked the current situation in Ukraine.
What would the US do if the soviets were to expand into Mexiko? Or... Cuba? We know how that went. If the mission of NATO was to secure peace, why would they reject Russia? It makes no sense from that perspective.
The answer is that there are other reasons NATO exists and what it is being used for.
I read somewhere a long time ago (so I could be wrong.) The origin of Switzerland happened when the bully state later joined the alliance that was explicitly formed to fight against it.
There's a very straight-forward solution to the threat, which if the US Government were smart it would be pursuing asap.
First, we have TSMC working on building in the US, that should be continued and accelerated if possible.
Second, work with Taiwan to force TSMC to split itself into a US and Taiwan division. The US division will be granted all the same intellectual property and will be IPO'd (with TSMC retaining a super majority ownership position; if China ever gets ahold of TSMC, we'd simply force the parent to sell its majority ownership position on national security grounds). But how will Taiwan force that outcome on TSMC? Nation states have fun ways to make things like that happen when it comes to their domestic corporations. But why would Taiwan do that? The same reason they're getting TSMC to build fabs in the US (which is a political move): because we're asking nicely and the US is the only thing keeping Taiwan an independent liberal democracy. TSMC is so big and strategically important, they're a political entity as far as Taiwan is concerned, they're even more outsized vs Taiwan than Samsung is vs South Korea.
it's enough for a government to say it won't buy chips manufactured abroad and presto, you have TSMC fabs being built on US ground as we speak; EU is close behind.
Carrots and a lot of stick got TSMC to open a small fab in the US for sensitive supply chains. JP and EU are getting similarly marginal expansion. Reality is significant high-value strategic production will stay on the island in short/medium term because TSMC/TW will fight tooth and nail to prevent erosion of their silicon shield. There's no presto, everyone knows banning TSMC chips would kill trillions of western high tech industries.
If the invasion comes, it will come because China will think it will succeed. And if it looks like it's going to succeed, why blow your own factories? After the war, you will have to return to ordinary life, and hopefully a job. Blowing away your own factories, to spite your enemies doesn't make sense. Sure you deny China access yo them. But you deprive your people who will have to live after the war there even more.
More likely scenario is that US is going to try to get them blown up (probably not directly)
Perhaps. I agree that scuttling the factory wouldn't entirely deter China from attacking Taiwan, but it would definitely dent the value prospect of doing so. TSMC under Chinese ownership would be a remarkably powerful bartering chip (companies spend billions just getting their foot in the door around there), so I could really see it going either way. I know people from Taiwan, their general consensus is that under Chinese rule there would be no "ordinary life", and their goal is to make China respect their independence to the bitter end. There's definitely insufficient economic motive here, but the politics of the matter run much deeper than that.
Depends on how critical TSMC will remain, there's also chance US will have to work with PRC to ensure production continuity. IMO preserving fabs as leverage is probably top priority for all parties concerned, no one gains from it's destruction. The scenario where US controls inputs, PRC controls fabs, TW controls production is still preferable to scenario where destroyed fabs grinds advanced industries around world (mostly in the west) to a crawl.
You think ASML wants to run afoul with the US, even if they can't force ASML? The main reason ASML has EUV is because it was funded by the US government to develop it. Now the tech is mostly ASMLs own, but they still have close ties to the US.
USA didn't have to force ASML to stop selling to China, they just had to ask them nicely.
The core ASML EUV technology is from their US subsidiary Cymer. All that IP is domiciled in the US. In addition, most of the critical semiconductor components throughout the scanner (FPGA, high performance analog, etc) come from American companies
I would imagine there would at least be a sharp decrease in yield rates. Hard to imagine all those Taiwanese TSMC workers working hard to ensure the technological dominance of mainland China.
There's a reason PRC has much more success poaching TSMC employees than US trying to fill up new fabs. Why TW has drafted laws to prevent TW semiconductor talent from working on mainland. Generally TWers prefer working in PRC, with comparable language / culture. Great compensation and quick flight home. Reality is most of TSMC employees will been prevented from being paperclipped to the US in event of war, their future will be firmly tied to PRC and as significant assets, they'll be treated with more carrots than sticks.
Don’t worry, Intel is expanding foundry capacity for this case. Apple SoC will stay on the same node for couple years, but that’s not an end of the world for consumers.
https://en.wikichip.org/wiki/technology_node#Leading_edge_tr...