[HN Gopher] TSMC Risk
___________________________________________________________________
TSMC Risk
Author : swolpers
Score : 122 points
Date : 2026-01-26 11:07 UTC (11 hours ago)
(HTM) web link (stratechery.com)
(TXT) w3m dump (stratechery.com)
| sylware wrote:
| There are some near ready foundries in the US and in EU, not to
| mention South Korea. It would take a few years to catch up of
| course.
|
| What I worry more about is the full lock-in of TSMC production
| capacity by nvidia/apple/amd/etc for their chips on their latest
| and greatest silicon process (aka the best in the world). There
| is 'no space' for performant large RISC-V implementations or
| other alternative (and it will require several iterations and
| mistakes will be made)
| iszomer wrote:
| Tenstorrent managed to secure TSMC manufacturing capacity, I
| doubt many other RISC-centric fabless companies would have any
| issues aside from aggressive competition.
| sylware wrote:
| I wonder when we will see RISC-V (rva23+) large
| implementations, for instance for performance "desktop" at
| 5GHz+ on latest silicon process...
|
| I know I can already replace my rpi3 with a linux supported
| out of the box RISC-V SOC board (aka, the enabling of
| assembly written software = no planned obsolescence from
| computer languages anymore, near 0-SDK).
| mrec wrote:
| Interesting point, although it's clearly not in TSMC's interest
| to land themselves in a monopsony situation by allowing Apple
| (e.g.) to squeeze all their competitors out of the market.
| christkv wrote:
| Im the EU there is Intel Ireland at least.
| DivingForGold wrote:
| "AI has a physical dependency in Taiwan that can be easily
| destroyed by Chinese missiles, even without an invasion" ?
|
| Arguably false. Why do you think the US has encouraged TSMC
| foundries, now inside Arizona ? It's obviously to protect against
| the scenario that China takes Taiwan. In that case, give it 6
| months or less for US TSMC foundries to produce the finest. China
| taking Taiwan will likely not result in the CCP getting any
| technology, certainly Taiwanese have "contingency plans" to
| vaporize all tech in the event they are invaded.
| showerst wrote:
| 90% of TSMC's capacity is still in Taiwan. A substantial amount
| of global high end chip capacity is also in South Korea and
| Japan, which would likely get pulled in.
|
| A war would not wipe out chip production, but the squeeze would
| be immense for many years.
| fc417fc802 wrote:
| > A war would not wipe out chip production
|
| It probably wouldn't but it definitely _could_.
| palmotea wrote:
| That's over-optimistic.
|
| > Why do you think the US has encouraged TSMC foundries, now
| inside Arizona ? It's obviously to protect against the scenario
| that China takes Taiwan. In that case, give it 6 months or less
| for US TSMC foundries to produce the finest.
|
| American business culture works pretty strongly against "give
| it 6 months or less for US TSMC foundries to produce the
| finest."
|
| I think it's most likely those fabs will stagnate and the
| American MBAs running them will just milk them for short-term
| profits. Why invest in technology when you can buy back shares?
| After all, your _only_ goal is number-go-up.
|
| > China taking Taiwan will likely not result in the CCP getting
| any technology, certainly Taiwanese have "contingency plans" to
| vaporize all tech in the event they are invaded.
|
| Not necessarily. Technology isn't so much the machines, it's
| the know-how. TMSC employees will still need jobs, post
| invasion, and I'm sure China will pay them _very_ well. Some
| fraction will go to work for Chinese fabs, and teach them TMSC
| 's tricks and knowledge.
| lotsofpulp wrote:
| >American business culture works pretty strongly against
| "give it 6 months or less for US TSMC foundries to produce
| the finest."
|
| >I think it's most likely those fabs will stagnate and the
| American MBAs running them will just milk them for short-term
| profits. Why invest in technology when you can buy back
| shares? After all, your only goal is number-go-up.
|
| The same American business culture that produced
| Apple/Amazon/Alphabet/Microsoft/Meta/Tesla/etc? They seem to
| invest quite a bit in "technology".
| UltraSane wrote:
| No, the same idiot MBAs that almost destroyed Intel and
| Boeing and General Electric.
| lotsofpulp wrote:
| There certainly are idiot MBAs (and non MBAs), and
| perhaps the ratio is too high in the USA, but based on
| the pre-eminent businesses in the USA, I wouldn't say
| it's "the" culture.
|
| One of the reasons Intel failed and TSMC succeeded is
| because Intel was unwilling to pay what the other big
| tech companies were paying (and part of that pay is with
| RSUs which stock buybacks help offset). However, for
| workers in Taiwan, TSMC was the best option, so TSMC
| could pay less.
| UltraSane wrote:
| Intel failed because the idiot MBAs refused to invest in
| keeping their lithography process the best in the world.
| Instead they spent $100 billion on stock buy backs.
| palmotea wrote:
| > The same American business culture that produced
| Apple/Amazon/Alphabet/Microsoft/Meta/Tesla/etc? They seem
| to invest quite a bit in "technology".
|
| Yeah. There can be sparks of innovation, but the overall
| trend seems to be squandering advantages for short term
| financial gains. And honestly, some of your examples aren't
| great: Telsa's probably going to lose to the likes of BYD
| (but for unusual leadership reasons); Microsoft seems to be
| losing former capability, which is reflected in many of its
| products (https://www.windowscentral.com/microsoft/windows-
| 11/windows-...); and I don't think Meta has done much
| besides sell ads.
|
| IIRC, Chinese companies, on the other hand, tend not
| actually make very much money for their investors.
| lotsofpulp wrote:
| The sentiment I was countering was that American
| businesses do not invest in technology, nor do American
| business leaders think about the long term, and the
| examples surely show that. Successful or not, and selling
| something detrimental or not, they do spend many, many
| billions of dollars on bets that may not pay out.
|
| You can even look to pharmaceutical companies for
| American business that have development timelines
| measured in the decades and investments measured in the
| billions. These aren't plays that executives profit from
| in 6 months, or maybe even 60 months. Real estate
| development is another business where investment
| timelines are in the decades.
|
| I don't know enough about Chinese businesses, but I
| assume I cannot compare the motivations of Chinese
| business leaders to American business leaders, as Chinese
| business leaders seem less free than American businesses
| to capture profits for their investors.
| raincole wrote:
| I don't even know what it means. "even without an invasion"?
| The author think China will destroy TSMC just because? To slow
| down AI progress?
|
| > if we got to a situation where only the U.S. had the sort of
| AI that would give us an unassailable advantage militarily,
| then the optimal strategy for China would change to taking TSMC
| off of the board.
|
| Lmao it's not. The author doesn't know what they're talking
| about at all. Let's be realistic: the current TSMC technology
| _will_ be accessible to China, likely via espionage. The
| question is just how soon. It has already happened before.
| China 's 7nm process was developed with the help from one of
| the highest level ex-TSMC researcher[0].
|
| [0]: https://en.wikipedia.org/wiki/Liang_Mong_Song
| stefan_ wrote:
| Hiring people isn't espionage. Key talent leaving a dominant
| manufacturer for a paycheck at a struggling competitor and
| bringing their knowledge is just about the basis of
| capitalism.
| fc417fc802 wrote:
| If cutting edge were a hard requirement then given the lead
| times involved I think the author would be correct. However I
| think there's a fundamental error in failing to account for
| the fact that you don't need cutting edge chips to do AI.
| Sure it makes it cheaper and faster but it's absolutely not a
| requirement. You could train a state of the art model on
| cluster of 12+ year old boxes (ie Intel's 22 nm and DDR3) but
| if you want to get the job done in a similar timeframe you're
| going to pay out the ass for electricity. Your research
| pipeline would necessarily be narrower due to physical and
| monetary limitations but that's not the end of the world.
| alex43578 wrote:
| That's like saying you could train a state of the art model
| by hand, and it'll only cost you a lot of man-hours.
|
| Realistically, to train a frontier model you'd need quite a
| lot of compute. GPT4, which is old news, was supposedly
| trained on 25,000 A100s.
|
| There's just no reasonable way of catching modern hardware
| with old hardware+time/electricity.
| fc417fc802 wrote:
| Training methods and architectures keep getting more
| efficient by leaps and bounds and scaling up was well
| into the realm of diminishing returns last I checked. The
| necessity of exceeding 100B seems questionable. Just
| because you can get some benefits by piling ever more
| data on doesn't necessarily mean you have to.
|
| Also keep in mind we aren't talking about a small company
| wanting to do competitive R&D on a frontier model. We're
| talking about a world superpower that operates nuclear
| reactors and built something the size of the three gorges
| dam deciding that a thing is strategically necessary. If
| they were willing to spend the money I am absolutely
| certain that they could pull it off.
| storystarling wrote:
| I suspect the bottleneck on 12+ year old hardware wouldn't
| be power but the interconnects. SOTA training is bound by
| gradient synchronization latency. Without NVLink you hit a
| hard wall where the compute spends most of its time waiting
| on PCIe or ethernet.
| fc417fc802 wrote:
| Fair point. Though if this were actually attempted I
| imagine it would start with making changes to the model
| architecture, the physical hardware, or both.
|
| My hypothetical is probably somewhat over the top given
| that isn't China somewhere in the vicinity of 7 nm at
| present?
| mytailorisrich wrote:
| Mainland China has no interest in destroying the fabs in
| Taiwan, quite the opposite.
|
| Taiwan might go scorched Earth and destroy them but that
| sounds more like a threat to foster US' support.
|
| For the US the threat is either destruction of the fabs or
| China leverage against them if they get to control the fabs.
| llm_nerd wrote:
| The overwhelming bulk of production, in a massively
| oversubscribed industry, is in Taiwan. If Taiwan's production
| went offline, there would be enormous turmoil.
|
| " _certainly Taiwanese have "contingency plans" to vaporize all
| tech in the event they are invaded_"
|
| Given the way things are going, a rationalist would surmise
| that Taiwan is likely in talks with China for a peaceful
| reunification, Hong Kong style. The old way is very much over,
| the US is a worthless if not negative-value ally, and it's
| pretty clear to every living human with a functioning brain
| that this is going to be China's century.
|
| Indeed, the article casually says "Taiwan is claimed by China,
| which has not and will not take reunification-by-force off of
| the table", which is technically true it isn't contextually
| informative. For those not fully up to date on the history of
| this conflict, for decades Taiwan claimed all of China (and
| most Western countries treated Taiwan as the singular
| government of all of China), and held out for reunification-by-
| force. This isn't as simple and straightforward like Trump's
| "we have a military ergo we get to steal better countries
| because they make us look bad".
|
| https://www.youtube.com/watch?v=pF-ZN11DRSE
| well_ackshually wrote:
| >In that case, give it 6 months or less for US TSMC foundries
| to produce the finest.
|
| It's really a blind belief in american exceptionalism that
| makes you think this is even possible.
|
| No, the chip factory that has had dozens of years of experience
| and local talent scaling up to make the most complicated
| products in human existence doesn't magically get up to par in
| 6 months. At best in 6 months they've figured out how to be
| less sensitive to vibrations and reach a low yield. The US
| doesn't have the trained workforce for this job, nor the
| infrastructures _around_ the fab (specialized hardware,
| electronics and engineering schools, various bits and bobs).
|
| US TSMC doesn't get properly running in less than 5 years, and
| even that would be a miracle. You're also assuming that US TSMC
| has the current N2P or even N3E processes, and that agent
| orange doesn't burn bridges with europe hard enough that ASML
| stops selling to anyone related to the US.
| tgtweak wrote:
| TSMC's Arizona fabs (edit: need to qualify this with "today"
| and in the near future) are wholly inadequate to shift wafer
| volume out of Tawian if that were to ever happen. TSMC
| themselves have been candid about this - both the fact there is
| insufficient skilled labor and insufficient economics
| (materials supply chain, construction costs/process, subsidies,
| OPEX). If TSMC was serious about this they'd have invested
| heavily both in staff pipeline (university programs and hiring
| onramps), domestic executive function and supply chain - aside
| from taking subsidies and building tiny fabs that trail their
| Taiwan process nodes considerably, they've done little to
| diversify their fabs.
| BigTTYGothGF wrote:
| The Arizona fab's not supposed, per wiki, to start producing
| 3nm until 2028. Are you suggesting that the only reason it
| can't be done by summer is a lack of motivation and resources?
| maxglute wrote:
| In 6 months TMSC US foundries would grind to a halt without
| consumables from TW who still has many sole source suppliers.
| The reason for CONUS TSMC fabs is because that's all US
| industrial policy can really manage, CHIPS never pretended to
| be able to reshore the entire semi supply chain (unlike PRC)
| and until US does, or at least reshores everything sole source
| off TW, will remain exquisitely vulnerable.
|
| Also TW politicians have objected to notion they'd vaporize
| their fabs / golden goose. That meme started by US Army War
| College + Colby who said US should blow up the fabs, as in it
| shouldn't be a TW decision. Which TW have rebuked said they
| will defend against US attacks. Also other shenanigans like
| when US suggest they would paperclip TW semi engineers, and TW
| basically said there's no way they'd send semi engineers to
| safety before children. AKA TW not retarded, they know not to
| toast their golden goose, because golden goose for PRC still
| gives TW leverage even if TW forced to capitulate. They'd still
| rather be wealthy semi producers than pine apple farmers under
| PRC.
| tester756 wrote:
| >China taking Taiwan will likely not result in the CCP getting
| any technology, certainly Taiwanese have "contingency plans" to
| vaporize all tech in the event they are invaded.
|
| He didn't suggest anything like that, did he?
| buckle8017 wrote:
| > AI has a physical dependency in Taiwan that can be easily
| destroyed by Chinese missiles, even without an invasion
|
| Taiwan has missiles with the range and warheads to strike the
| three gorges dam.
|
| An attack by China would end very poorly for everybody. There are
| millions of people living in the inundation zone.
| fruitworks wrote:
| Could the chinese construct a sufficient anti-missle defence?
| buckle8017 wrote:
| Obviously the actual number of missiles Taiwan has is not
| public, but I suspect they have enough that reliably
| intercepting a full barrage is not something even the us
| could pull off.
| wat10000 wrote:
| The general calculus is that an interceptor costs as much
| as the missile it intercepts, so defenses are only
| effective against an adversary with much less resources.
| Hence Israel can defend against Hamas/Hezbollah, and the US
| can defend against North Korea, but Israel struggles
| against Iran and the US doesn't even try to defend against
| China/Russia.
|
| China obviously has a lot more resources than Taiwan, but
| then you have a concentration effect where an attacker can
| focus their resources on a single target, but a much more
| resourced defender can't necessarily afford to defend that
| target. We saw that play out with the UK's nuclear
| deterrent strategy in the cold war, where they focused on
| overwhelming Moscow's defenses, and were (probably) able to
| do it despite the USSR being so much bigger.
| maxglute wrote:
| TW missiles can't "concentrate" because TW geography =
| all missile flight paths travels through boost, midcourse
| and terminal interceptors gauntlet along PRC easter
| theatre command which probably has the densest IADS in
| the world. PRC has like 3-4x more interceptors in eastern
| theater (8-12x more total) than TW has missiles. That's
| just land based, there's also 1000s of naval picket
| interceptors. Imagine if all of US patriot batteries in
| Florida, multiplied by 3, then asking what Cuba can do to
| saturate. Then add in USN DDGs and the answer is
| realistically nothing, because the industrial math is
| brutally lopsided. That's assuming TW gets to coordinate
| salvo their entire inventory, realistically most TELs
| would be glassed first, every part of TW is withing 5-7
| min of PRC missiles and mlrs, less if fired from strait
| or loitering munitions, i.e. basically faster than
| abbreviated TEL setup cycle TW has for their tunnel to
| launch strike complex.
| mjhay wrote:
| A conventional missile or even missiles is not going to destroy
| a huge gravity dam like that. They are incredibly tough
| structures and missile warheads aren't big. We're talking
| concrete hundreds of feet thick.
| fc417fc802 wrote:
| To add some background. During WWII the allies successfully
| used massive specialized depth charges but those were much
| smaller dams. [0] During the Korean war the US struggled to
| merely destroy the sluice gates of a dam using aerial
| torpedos. [1] Eventually the Geneva Conventions were amended
| to forbid attacking dams if it would kill a large number of
| civilians (which was pretty obviously implied to begin with
| for what it's worth).
|
| So unless Taiwan has a method to deliver something the size
| of a bunker buster to the underwater base of the upstream
| side of the dam I don't think it's going to happen. And if
| they did manage to pull it off they'd presumably be condemned
| as war criminals more or less universally.
|
| [0] https://en.wikipedia.org/wiki/Operation_Chastise
|
| [1] https://en.wikipedia.org/wiki/Hwacheon_Dam
| maxglute wrote:
| TW doesn't have any munitions that can remotely breach gravity
| dam like three gorges, i.e. bunker buster, which even if they
| did, they wouldn't have survivable platform to deliver it
| (strategic bombers, too heavy for TEL). US MOP tier 30000kg
| penetrator munitions isn't designed to crack three gorges, TW
| missile inventory are like 1500kg, at most they'll inflict
| scabbing or break exposed components like power infra, lock
| gates, which is not nothing, but not remotely compromise
| structural integrity of dam. This not to mention TW missile
| trajectory is geographically constrained and overflies the
| densest IADS environments on earth, assuming their TELs are
| survivable in the first place. They're much better off trying
| to threaten PRC coastal nuclear, but either way gets them the
| Gaza treatment.
| alephnerd wrote:
| From a NatSec perspective, TSMC isn't really a bottleneck - most
| weapon systems use SoCs and microcontrollers that can be fabbed
| on "legacy nodes" (ie. 28/40/60/90nm) or 14/20/22nm nodes, and
| compound semiconductors.
|
| The ability to mass produce a Pascal or Volta comparable GPU or
| Apple A11 comparable SoC is all you need for more cutting edge
| systems.
|
| Power Electronics and Compound Semiconductors (GaN, SiC) have
| historically been the biggest bottleneck.
|
| The bigger risk for the TSMC-China aspect is TSMC's planned exit
| of GaN foundry production by 2027. Most Chinese manufacturers
| _still_ depend on TSMC-produced GaNs wafers instead of
| domestically produced GaN vendors due to reliability concerns.
| China will probably end up matching TSMC 's specs for compound
| semiconductors in 4-7 years, but that implies that the Sullivan
| Doctrine still holds and is a loss for China.
|
| Every other country with compound semiconductor production
| capabilities at scale (US, Germany, France, South Korea, Japan,
| Israel, Russia, India) either limits their exports or cannot
| export them to China without facing sanctions from other buyers
| (primarily Russia as India does _not_ allowing commingling of
| SKUs for defense vendors who sell to Pakistan /China as well, and
| Russian vendors are members of India's EW and DEW program).
|
| If a US-China War was to arise, worst case we would probably see
| a mass reversion back to 2018-22 level technology, which isn't
| the end of the world.
|
| Additonally, the China-Taiwan situation is _orthogonal_ to
| semiconductor dependency.
| joe_mamba wrote:
| _> If a US-China War was to arise, worst case we would probably
| see a mass reversion back to 2018-22 level technology, which
| isn't the end of the world._
|
| It wouldn't be the end of the world if those 2018 chips came at
| 2018 prices and only impacted commodity stuff like phones,
| datacenters and laptops, but they'll be at 10x the 2018 price
| and impact critical stuff like automotive, the cars and trucks
| that gets your food delivered to the supermarket, and if those
| become impossible to buy or fix anymore, then your groceries
| will also get more expensive, triggering an end-of-the-world
| riot from taxpayers who can't afford food anymore.
|
| People need to view this issue as not just being stuck with
| 2018 laptops and phones which isn't that bad, but has much
| wider societal implications.
| alephnerd wrote:
| > impact critical stuff like automotive, the cars and trucks
|
| Most capacity for legacy nodes is already ExTaiwan and
| ExChina. TSMC leapfrogged American and Korean fabs in the
| late 2010s/early 2020s with sub-14nm process nodes, but
| Samsung and Intel have caught up for 5nm and 7nm capacity.
| And Taiwanese firms have largely diversified OSAT and ATMP
| away from Taiwan and China to ASEAN, US, and India.
|
| This is something everyone adjacent to this space has been
| thinking about and acting on since 2017.
|
| > only impacted commodity stuff like phones, datacenters and
| laptops
|
| Data Center and enterprise applications are prioritized in
| most ExTaiwan sub-7nm fabs such as Intel 18A.
|
| ---
|
| A US-China War over Taiwan would be devastating, but not
| getting an M1 Macbook will be the least of your worries.
| joe_mamba wrote:
| _> A US-China War over Taiwan would be devastating, but not
| getting an M1 Macbook will be the least of your worries._
|
| Isn't this what I said?
| Legend2440 wrote:
| >most weapon systems use SoCs and microcontrollers that can be
| fabbed on "legacy nodes"
|
| The argument is that existing weapons systems are essentially
| old tech, left over from previous wars in previous decades.
| Many of them are less useful in the modern battlefield, e.g.
| defense systems built to shoot down missiles are easily
| overwhelmed by drones.
|
| If there's a _real_ war, it will be fought with next-gen weapon
| systems - probably autonomous drones that will require high-end
| AI chips.
| boxed wrote:
| > Rather, the only thing that will truly motivate TSMC to take on
| more risk is competition.
|
| Maybe I missed something, but if Google, Microsoft, Apple,
| OpenAI, etc want more capex on fabs, they can front that money
| themselves?
| aurareturn wrote:
| Yes. I think the article missed it. In fact, I expect it to
| happen this year when Nvidia overtakes Apple as TSMC's biggest
| customer.
|
| It's going to start a wafer war in my opinion. Best way to
| secure wafer supply is to pre-pay.
| kouteiheika wrote:
| > Anthropic Chief Executive Officer Dario Amodei said selling
| advanced artificial intelligence chips to China is a blunder with
| "incredible national security implications" [...] "I think this
| is crazy. It's a bit like selling nuclear weapons to North
| Korea."
|
| This is all a smoke screen. He knows very well that China can and
| will develop their own hardware to train AI models (and in fact,
| they _are_ successfully doing just that; e.g. the recently
| released GLM-Image was trained on their own silicon). His only
| objective here is to slow them down enough so that they don 't
| eat Anthropic/Claude's lunch releasing open-weight models that
| are increasingly competitive. But he can't just openly say "hey,
| we don't like that they release open weight models for free", so
| he's engaging in the AI version of the "think of the children"
| argument.
|
| Anthropic's whole modus operandi was always pretty much "we
| should control this technology, no one else". It's not a
| coincidence they're the only major lab which has not released any
| open weight models, they don't publish any useful research (for
| training models) and they actively lobby the lawmakers to
| restrict people's access to open weight models. It's incredibly
| ironic that Dario is worried about (I quote) "1984 scenarios"
| while that's exactly what his company is aiming towards (e.g.
| giving Palantir access to those models is not "unsafe", but an
| average Joe having unrestricted local access is an immediate
| 1984-style dystopia).
| CMay wrote:
| The more complex the process becomes, the harder it is to have
| equivalent competition so you're bound to have issues where a
| single company's investment decisions have widespread impacts.
|
| My perspective on the China risk differs some, though. China
| wouldn't benefit much from attacking TSMC. This is the first time
| I've heard anyone suggest that they might. At best they'd like to
| have it in-tact if they do take Taiwan, but there have been talks
| about machines being rigged to explode to deny them from China,
| or the US striking them in that scenario.
|
| If neither we nor China get to work with TSMC, then we're still
| ahead in relative terms. If China did attack TSMC, they set the
| norm that the fabs (including their own) are now a fair target
| which would be a larger disadvantage for them than it would be
| for us since China's physical power projection remains pretty
| regional outside of Chinese nationals abroad engaging in
| sabotage.
|
| That is one of their biggest weaknesses. Yes they have a lot of
| manufacturing capacity and a large population with many talented
| people, but in a way we have lent them the power to scale up to
| see what they'll do. We are already putting some pressure on that
| scale now that they've shown who they are, but if it came to war
| it would be very doable to start reversing their scale and their
| capacity to do the same to us would degrade as ours increases.
|
| Even if all the AI in the world was destroyed, that's how it
| would play out. The problem is that Taiwan remains in close
| proximity to China so similar to Ukraine it would likely come
| down to how long they're willing to throw everything at it.
|
| If Russia and China wanted to be powerful, it's just idiocy to
| show the existing superpower that you cannot be trusted with the
| power you have. If they fancy a merit based society, they forgot
| that merit isn't omnipotence and you still need the right ideas
| to be at the top to accompany the merit. For China maybe they
| need AI for that alone, but western societies at least have ways
| for the right ideas to make it to the top without the strict need
| of AI.
| nebula8804 wrote:
| The US has shown that it can't handle any level of discomfort.
| The reason Trump is back in the white house is because grocery
| prices went up a little bit. Can you imagine the failure of the
| tech companies that are propping up the entire economy? That
| would happen under a Taiwan invasion scenario. China has a much
| high pain tolerance than US citizens at least. I'd argue they
| would outlast the US. Would they outlast the US military? I
| don't know. But it may not matter as given enough pain the US
| population will make itself heard.
| CMay wrote:
| I think you're conflating different contexts and scenarios.
| People aren't used to war being brought to the US itself.
| Look at Pearl Harbor and 9/11, both rallying the country
| pretty well. Attacking the US mainland is a losing strategy.
|
| If people generally understand that we're intervening in a
| China/Taiwan conflict for the right reasons, and China
| attacks us at home it would only accelerate the west. If you
| look at Vietnam, the logic around that war fell apart and it
| no longer made sense to continue it. The people were right to
| push back. Iraq and Afghanistan went on for a long time
| without much fuss.
|
| Some kind of conflict in South East Asia would likely largely
| be a naval and resource war, with many casualties being naval
| rather than mainland. Most losses on both sides will probably
| be drones, AI or not.
|
| If it came down to attrition, it would maybe be AI machine
| attrition or drone/missile attrition which is in a way a
| resource war which the US could win even without TSMC, but
| from where we're standing today it would take more ramping up
| which is a process that has already started.
|
| If OpenAI, Google, Microsoft, Amazon, etc were attacked by
| China in a more critical way, it would have to be for some
| major short term advantage that is capitalized on
| immediately, because long-term it would be a losing strategy
| by itself. China has systems to disrupt as well, so if they
| let loose on cyber then the US has options too.
|
| Either way, don't conflate general economic preference around
| an election for whether people would tolerate being unable to
| access Gmail or order from Amazon like they would all rush to
| riot in the streets. I think that misreads the situation.
| churchill wrote:
| Off topic, but the reason Vietnam played out the way it did
| was because of China's implicit guarantee that they'd
| intervene in force if American troops came anywhere close
| to their borders like during the Korean War.
|
| Fresh off WW2, with a titanic arsenal and industrial base,
| America and all of its allies couldn't end the war on their
| terms after China intervened.
|
| That's why the US only did search-and-destroy missions,
| targeting Vietcong cells in the south and bombing supply
| lines in Laos. Which didn't matter much.
|
| Once the Americans left, the North marched down a proper
| army and wrapped it up.
| mahirsaid wrote:
| I assume that in the failing of the tech industry brings
| discomfort like you mentioned will have an impact on society
| such as strikes, riots, protests. The US will surely hope
| this gets mirrored to the Chinese society, although i would
| like the mention that there is a difference between self
| sabotage and external sabotage, Chinese people are pretty
| understanding and patient not all are against their
| government. Most respect and are grateful for what their
| government has done for the country in the last 30 years,, i
| would say roughly 80% of them feel this way. This sentiment
| is beneficial, because it only speeds up recovery from
| economical disruptions such as this example, housing market
| is another story.
|
| Another note most of the world understands US's strategy for
| this type of disruptions used as a weapon, if they can cause
| civil unrest, the US can use this against the government and
| it will into the advantage of the US. I would like to note
| this is not a country of easy convincing, The majority of the
| seating members of the CCP are deeply interested in their
| society's interests, then globally second. You have 1.4b
| people this is not an easy management to handle.
|
| In my eyes best to not compete and work together. There are
| hard obstacles ahead that are going to need all of our
| efforts collectively, in Hines-sight this is childish and a
| waste of time, literally. We made it this far, all of the
| great achievements and innovations that with out a doubt all
| have collectively contributed as humans. Climate changes,
| Populations management, Biological threats, viral threats,
| pandemic management, genome advancements etc...
|
| Some of the moves that leaders make are simply moving us back
| in time and when one does something unfavorable to the other
| it sets the tone for how future engagements and decisions are
| made, whether silly or not. Indeed no leader is innocent in
| their decisions, but my point still stands.
| CMay wrote:
| The battle against communism has been going on for a long
| time and it was an important factor in most of the major
| wars of the 1900s when it openly stated it needed to
| establish global dominance. In the grand scheme of things,
| this is more of that, but now China is the center of
| gravity for communism rather than Russia. The Arctic
| opening up and taking Taiwan are both elements that
| increase potential for power projection, which is a serious
| threat given that CCP leadership has shown to be very
| bullish on Marxism-Leninism.
|
| If they could not be insane and trade, that would be great.
| Unfortunately that's not the world we live in and the US
| has to push back against it or the world can fall into
| ruin. So we're cleaning up Venezuela. Maybe Cuba and Iran.
| ahmeneeroe-v2 wrote:
| >China has a much high pain tolerance than US citizens at
| least
|
| Can you give some examples of why you think this? I really
| can't imagine how this would be true.
|
| Best examples would be in last 25 years when they've had mass
| affluence.
| icegreentea2 wrote:
| China was able to sustain some pretty strict zero-COVID
| policies much longer - all the way to late 2022.
|
| Pain tolerance might be the wrong term. Pain tolerance
| implies speaks to something intrinsic about a population,
| while really what we're looking at is how much discomfort a
| population can endure before it really agitates for
| policy/political change, and so it's much about how a
| population feels, as the tools available to the government
| to control, manage, deflect and address the
| pain/discomfort.
| aesch wrote:
| Yeah, I agree there is some manipulation of the narrative
| in the use of pain tolerance to describe China's
| citizenry. It is in the CCP's interest to convince their
| population that pain tolerance is a virtue, rather than
| allow an alternative narrative that China's citizens must
| suffer the decisions of the autocrats because they have
| no ability to influence change.
| ahmeneeroe-v2 wrote:
| Thanks for the response, agreed on the definition of
| "pain tolerance."
|
| I do think that the US population is able to bear
| incredible levels of pain if it's packaged a certain way.
| Examples:
|
| -20 year Global War on Terror which cost $6T+
|
| -Healthcare costs which far outstrip other western
| nations, mostly paid for out of pocket, and which
| increase every year
|
| -Opioid Crisis which killed more people than all our 20th
| century wars combined
|
| -Lack of workplace protections, time off, etc which our
| peer nations enjoy
|
| The Chinese have not dealt with any of these things, so
| yeah, they have more available capacity to manage new
| social disruptions. That said, Americans love war, so we
| could probably add another war without disrupting things
| too badly.
| boelboel wrote:
| Chinese employees get less time off and many of them got
| less workplace protection.
|
| The availability to good healthcare for many conditions
| in China is quite subpar compared to the US. They don't
| have many physicians. Their healthcare outcomes in most
| things are worse than those for Americans. Good example
| is their lung cancer morality rates.
|
| Of course both these things are expected for a much
| poorer country.
| TacoCommander wrote:
| Unpopular opinion: We don't really NEED these bleeding edge
| chips. What does humanity need? Clean air, clean water, healthy
| food, health care, compassion, education.
| manuelmoreale wrote:
| Lot of people seem to be happy to live without the last two
| unfortunately.
| aurareturn wrote:
| In my humble opinion, China taking Taiwan, if done under Trump,
| will be the market buying event of the century.
|
| It will tank the markets because people will assume a
| depression-level event and WW3. But Trump isn't like other
| presidents. He'll make a deal with China. And finally, the
| China/Taiwan cloud over the markets will go away for good and
| countries can start trading freely with China again. Markets
| will severely over react initially.
|
| I can see TSMC benefiting hugely from this long term, as long
| as the reunification is peaceful no damage to any TSMC fabs or
| people. The reason is because TSMC will most likely be forced
| to open up to both Chinese and US customers. Right now, they
| can't serve the world's second largest market. Nearly half of
| their customers can't use them.
|
| I'm making these assumptions:
|
| 1. China won't use force (or very very little) to take Taiwan.
|
| 2. There won't be WW3 that will come out of this. You'd have to
| be an idiot to think that Americans will die defending Taiwan
| or that Europe will send troops when China is quickly becoming
| their biggest trading partners and US has shown they're
| susceptible to annexing Greenland.
|
| 3. China will operate 1 country 2 system long term with Taiwan.
| CMay wrote:
| 1. I generally agree that China has a better chance with
| hybrid tactics that escalate in ways that meter western
| response, but Taiwan can force escalation too once it reaches
| a threshold and it would be within its right to.
|
| 2. If Russia, North Korea, South Korea and Japan join in
| there is a lot of potential for it to scale up. Whether it
| would become an all out horrific war like a World War or stay
| a little bottled up, it does risk becoming a huge conflict.
| Many Americans love South Korea and Japan, though they're
| less informed about Taiwanese. If South Koreans and Japanese
| are dying, we will be involved in one way or another.
|
| 3. No it won't. Look at what happened with Hong Kong, it
| broke its promise, just like the CCP breaks many of its
| promises. Not sure how bad they are compared to Russia in
| that regard, but it's pretty bad. Besides, if China wants to
| expand the way it seems like they want to, they need to take
| Taiwan so I doubt they would slow roll it.
| aurareturn wrote:
| 2. Americans don't love South Korea and Japan enough to go
| die for them. You'd have to be insane to believe that.
|
| 3. Hong Kong is still a different system last I visited
| (2024).
| sarabande wrote:
| Could you please consider making your points without
| "you'd have to be insane/an idiot to believe X"?
| aurareturn wrote:
| Fair enough.
| CMay wrote:
| Well, South Korea and Japan being involved would just be
| one factor that makes justification even easier. The real
| reason would be national and global security. It's in the
| interest of preservation of freedom. You don't wait until
| the enemy is at your doorstep, because that means you
| allowed them to snowball an avalanche at you. You meet
| them at their doorstep before they've gained full
| momentum.
| aurareturn wrote:
| Do people still believe it's about freedom?
| CMay wrote:
| Absolutely, because it is. Sometimes it's about X,
| because X is also related to freedom.
|
| Let's set X = oil. Oil is a critical resource that is
| huge for transportation. If you are the one that controls
| it and people need it from you, that gives you leverage
| to encourage them to do what you want. An authoritarian
| country that engages in mass killings and torture of its
| own people could get away with a lot and even abuse other
| countries if it has enough oil.
|
| You can apply this to nukes and many other things. Like
| maybe you defend an ally. Why defend an ally? Having them
| makes you stronger. Why do you need to be stronger? To
| defend the way of life you believe in.
| drtgh wrote:
| I do not know if China could find a better window to take
| Taiwan,
|
| Big tech manufacturers are treating consumers like crap by
| selling chips and memory to over-invested start-up companies
| that will go bankrupt, as these products will not be profitable
| due to the high costs (the technology that would make them
| profitable does not exist and has not even been conceived), in
| addition to the low long-term quality of what they offer.
|
| The thing is, right now, billions of consumers around the world
| see how those big tech manufacturers are not serving them the
| pieces they need, and that such techs will not do in the near
| future with fair prices (prices abuse escalation, the consumers
| lost their strength).
|
| Right now, if China takes Taiwan, 2026-2027, even if they lose
| the fabs, the billions of consumers in this planet will see
| this as a real f** you big techs, f** you overinvested startups
| hoarding, go go China, as we realize that we are third category
| citizens in this "first the riches" spiral, and will be no much
| difference of what is going on now.
|
| If China takes his media news cards right, and makes know the
| consumers this is a revolution, and combine it with one of the
| numerous Taiwan's corruption scandals, I bet they will not find
| the opposition from citizens around the world that they would
| find in a different period of time.
| throwaway63253 wrote:
| Honest question, from non-american: what is up with all the China
| scare? I just can't understand it. Is it because China is
| socialist and we want to see capitalism winning over?
| jryan49 wrote:
| I think the west is scared of China trying to take over the
| world by force like the USSR.
| AnimalMuppet wrote:
| It's because Xi has demanded that China's military be ready to
| invade and conquer Taiwan by 2027. It's because Xi has made
| reunification with Taiwan a test of the legitimacy of the CCP's
| rule over China. The combination of those two things gives you
| a "China scare" with respect to Taiwan, out of Xi's own mouth.
| ahmeneeroe-v2 wrote:
| It's easier to explain if we knew your country. But in general:
| limited resources, us vs them, etc. Same thing as Rome vs
| Carthage.
| jmyeet wrote:
| Anyone who is unironically saying China attacking Taiwan is a
| real threat (eg The Anthropic CEO quoted in the article) is
| either simply echoing the administration's painting of China as a
| geopolitical bogeyman or they're just ignorant of geopolitics,
| likely because they're projecting American economic imperialism
| onto China.
|
| I'm glad the article dismissed this as a threat because it isn't
| one. The official policy of the US is the One China policy.
| You'll see this described as "strategic ambiguity". That's
| another way of saying that the official policy is simply to lie
| about supporting Taiwan's independence.
|
| China can only hurt their position by taking military action
| against Taiwan. Also, it's highly debatable if they even have the
| military capability to invade Taiwan. Naval blockade? Sure. But
| to what end?
|
| China is going to make their own chips. They'll just hire the
| right people to replicate EUV lithography. The article brought up
| nuclear weapons. It's a good analogy. At the end of WW2 the
| thinking of the US military was that the USSR would take 20+
| years to get the bomb if they ever got it. It took 4 years. The
| gap with the hydrogen bomb was even less.
|
| Western chauvinism in policy circles completely underestimates
| China's capacity to catch up in lithography. Not selling the best
| chips to China created a captive market for Chinese chipmakers.
|
| I also think TSMC is being understandably cautious in not
| expanding their CapEx. AI companies really should focus on an
| economic use case for AI more than worry that foundry capacity
| will somehow limit a theoretical future AI use case.
| reducesuffering wrote:
| jmyeet:
|
| "Putin is in the wrong here but there are no good guys. US
| rhetoric on this has predicted a full-scale invasion that
| hasn't come to fruition multiple times and the media just laps
| it up. It's reminiscent of the WMD justification for invading
| Iraq. It's straight up Manufacturing Consent [1]. However,
| Putin has a point: extending NATO membership to Ukraine is an
| overtly hostile act by the US and NATO member states. Putin no
| more wants NATO bases in the Ukraine than the US would want
| Chinese or Russian military bases in Canada or Mexico.
|
| But Russia is not and never was going to launch a full-scale
| invasion of Ukraine. It would destroy Russia. Trying to do this
| in Afghanistan, a substantially smaller and less developed
| country, played a significant factor in the collapse of the
| Soviet Union.
|
| Russia wants a buffer between it and NATO and access to the
| Black Sea. That's it."
|
| https://news.ycombinator.com/item?id=30421629
| tgtweak wrote:
| I really don't understand why companies are ignoring intel's
| foundry services... for the first time since probably the 2000's,
| intel's 18A nodes are significantly ahead of what TSMC is
| offering. Apparently they have capacity and are demonstrating
| wafer production with their own chips.
|
| It seems wholly illogical that Apple would get refused wafer
| volume by TSMC and still refuse to give volume to intel foundry
| services. When you layer on geopolitical factors and national
| security implications + the fact that Apple is a US company -
| what reason could they possibly have to turn the shoulder to
| intel's foundries?
|
| If Taiwan ends up imploding in any of the numerous ways we are
| aware of today - and which this article adds to - I think there
| are exactly zero reasons to feel like this couldn't have been
| avoided.
| 9cb14c1ec0 wrote:
| This is why: https://arstechnica.com/gadgets/2026/01/core-
| ultra-series-3-...
|
| Intel doesn't have any spare capacity.
| variaga wrote:
| Some of us are old enough to remember the last time Intel was
| definitely, 100%, for-sure committed to offering foundry
| services, and then changed their mind and canceled the whole
| thing (it was in 2018) and want to see (a) someone else have
| success with 18A first and (b) intel show an actual long-term
| commitment to using their foundry for outside customers before
| we risk our companies' future on them.
|
| There are risks with TSMC, but "TSMC just decides it's not
| interested in making chips for other people, and cancels the
| whole business" isn't one of them. The same cannot be said for
| Intel.
| tgtweak wrote:
| If Intel decides they're not going to continue foundry
| services after 14A - you can just shift back to TSMC like
| everyone did between Samsung and TSMC?
| SteveNuts wrote:
| And just hope they have any capacity to deliver? That's
| what I'd worry about, especially right now.
| variaga wrote:
| "Just shift back" is really underestimating how much effort
| it takes to port a design to a different foundry. Sure, you
| can target a new stdcell library and recompile your RTL
| (and re-floorplan, and re-do a bunch of other stuff) but
| you also have to swap out all your memories and interfaces,
| not all of which may have exact equivalents... it can
| easily take 1+ years of work for a competent team, and if
| you have to shift back all that time and effort was wasted.
| tgtweak wrote:
| Seems most major players are not only fabless but also
| fab-agnostic - as I noted they switch from one supplier
| to another even for the same product line. I'm sure it is
| work but it doesn't seem to be an existential crisis for
| a huge provider to send some volume to a new fab -
| certainly if it's derisking supply capacity, tariffs or
| other geopolitical risks.
| AnotherGoodName wrote:
| >intel's 18A nodes are significantly ahead of what TSMC is
| offering
|
| A nice comparison table linked below. The best comparison imho
| is transistor density which is 313MTr/mm2 for TSMC's latest in-
| production process vs 238 for intel (higher is better).
|
| https://en.wikipedia.org/wiki/2_nm_process
|
| Also make sure to read the drama around
| https://en.wikipedia.org/wiki/Arrow_Lake_(microprocessor).
| Intel literally gave up making their own CPU on their own 20A
| process and instead utilised TSMCs fab.
| irishcoffee wrote:
| Shewie, given all the replies to this, and my personal living
| memory/experiences with these kinds of things as they relate to
| said replies, sounds like buying intel stock is probably a
| pretty good idea.
| patmorgan23 wrote:
| Intel doesn't seem to be properly resourcing and supporting
| Intel foundry. A lot of it is cultural/political, intels fabs
| are used to working only for Intel and not having to worry
| about propriety details of fab processes leaking externally, so
| there's a distrust when working with the foundry team and
| external customers.
| aurareturn wrote:
| intel's 18A nodes are significantly ahead of what TSMC is
| offering.
|
| Citation needed. From density charts, Intel's 18A is roughly
| equal to TSMC's N4P, released in 2022.
|
| Further more, Intel's 18A yields are not where Intel needs them
| to be to be competitive.
| zpeti wrote:
| I remember Elon saying in an interview recently that the only
| piece of the vertical stack he doesn't own is chips.
|
| I strongly suspect some sort of fab built by Elon associated
| companies will be announced soon. Almost all supply can be bought
| by Tesla and xAI.
|
| It makes sense, IF he can get the tech to work at the bleeding
| edge. But he seems to be quite good at this.
| tgtweak wrote:
| He hasn't offered any production services to third parties
| whatsoever (seems to end at patents/standards gifting) - I
| wouldn't expect a fab open to third parties at all - if
| anything it'll be reserved for tesla/space-x/x.ai usage and
| candidly I don't think there's enough demand there to justify
| the capex involved in a fab.
| bigyabai wrote:
| Standing up a modern-node EUVL fab is harder than rocket
| science. Tesla and xAI don't have the capex to do it, and the
| silicon they manufacture would be competing against much more
| experienced fabs like Samsung and Intel.
|
| Frankly it is hopeless, I would be dumbfounded if Elon ever
| walked through the doors of ASML.
| jackliuhahaha wrote:
| TSMC just needs to change its name to USMC and the stock will
| easily go up 20%
| christkv wrote:
| Im always surprised people forget that Intel exists and still has
| high performance nodes (just release panther lake on their newest
| node). They even have a plant in Ireland.
| aurareturn wrote:
| No one forgets that. Intel will get some customers. It's
| inevitable because according to the article, TSMC had severely
| underestimated AI demand in 2023 and 2024 by not drastically
| increasing capex in those years.
| junesix wrote:
| It's not that people forget that Intel exists, it's that they
| are effectively irrelevant to the foundry business.
|
| > Becoming a meaningful customer of Samsung or Intel is very
| risky: it takes years to get a chip working on a new process,
| which hardly seems worth it if that process might not be as
| good, and if the company offering the process definitely isn't
| as customer service-centric as TSMC.
|
| TSMC is a reliable supplier and there are no doubts about
| conflicts of interest. The same cannot be said for Intel and
| Samsung. If Intel's AI chip business faces chip shortages (like
| what may already be happening), can their foundry be depended
| on to ship your chips?
|
| No one wants to be the idiot who staked their future on Intel
| and then gets wiped out when Intel doesn't deliver.
| aurareturn wrote:
| Rather, the only thing that will truly motivate TSMC to take on
| more risk is competition.
|
| I see it another way for more chip manufacturing capacity.
|
| If big tech wants TSMC to increase capacity drastically without
| TSMC having to take all the risk of CapEx, then they can pre-pay
| for wafers from TSMC.
|
| They can each give TSMC $10b now in cash and guarantee themselves
| wafers in 2-3 years that it takes to bring a new fab online.
|
| TSMC is rightfully conservative. If they commit to spending an
| extra $30b on a fab now that won't make a single wafer until
| 2029, without any guarantees from big tech, they're stupid. Who
| knows if the demand will still be there (my guess is yes, but who
| knows?).
|
| In my opinion, I think it's getting close to this. Nvidia will
| surpass Apple as TSMC's biggest customer this year. This will
| start a war for TSMC wafers in 2026 in my opinion. When you have
| that much demand, customers will be forced to pay well in
| advance.
|
| There is already a war for memory, silver, copper, energy. No
| reason why chip production won't be next.
| vondur wrote:
| Isn't that what Apple did originally with TSMC? Payed for
| capacity rollout?
| aurareturn wrote:
| I think most customers nowadays pre-pay for fab capacity.
| TSMC is running at 100% capacity for their N5, N3, and N2
| nodes. Apple certainly makes extra commitments to be the
| first to use a new TSMC advanced node. They will be the first
| to ship an N2 chip by a few months when they release the
| iPhone 18 Pro.
|
| However, I'm talking about booking wafers from a fab that
| hasn't started and won't make a single wafer 3 years from
| now. The scale is different. Imagine Nvidia, Apple, Google,
| AMD, Microsoft, Meta, Amazon telling Wall Street in their
| earnings report that they sent TSMC $5 billion each this
| quarter and won't receive a single wafer for another 3 years
| from the investment. I fully expect this to happen soon. I'm
| almost certain that you'll hear in the upcoming earnings
| reports that big tech sent Samsung, Micron, and SK Hynix
| billions in advance payment to secure memory supply years
| from now. I think this is likely the same for chip fab
| capacity soon.
| davidhyde wrote:
| > "I would ban the sale of semiconductor manufacturing equipment
| to Chinese fabs".
|
| Ahem, ASML, who makes the manufacturing equipment for TSMC is a
| Dutch company, not a US one.
| mrDmrTmrJ wrote:
| The UV light source that ASML uses for its lithography machine
| is technology that was acquired in the 2013 acquisition of San
| Diego-based Cymber. The tech stack for the advanced light
| source dates back to the "EUV LLC Initiative," led by DARPA in
| the mid-1990s.
|
| US origins of the key technology here give the US a veto here
| regardless of ASML's Dutch headquarters.
| manuelmoreale wrote:
| > US origins of the key technology here give the US a veto
| here regardless of ASML's Dutch headquarters.
|
| Is this an actual thing? Genuinely asking. Not that rules and
| laws seem to matter anymore to the current US administration
| anyway
| nine_k wrote:
| First sale doctrine called, reminded about itself.
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