Chinese semiconductor industry

localizer said:

A year ago they were saying China was 5 years away from making 14nm chip.




Taiwan is getting abandoned.

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Please note that TSMC will require approval from their gov in order to build fab with their latest node in US. As much as a lapdog the DPP admin is, I don't think they will be dumb enough to give away their main crown jewel. They themselves should fully know well that US is only making of tw island to antogonise China, and will be abandoned to their own fate once their value is lost.

This is going to kneecap Huawei, not to mention all the coming restrictions on SMIC.

Pkp88 said:

This is going to kneecap Huawei, not to mention all the coming restrictions on SMIC.

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They might want to be careful walking down this path, China hasn't retaliated in kind yet. America should keep that in mind if it wants to keep getting cancer medicine.

ZeEa5KPul said:

They might want to be careful walking down this path, China hasn't retaliated in kind yet. America should keep that in mind if it wants to keep getting cancer medicine.

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The main concern of US gov is to stop China's economic development and growth at all cost. Don't the last 4 years already gave us obvious clues ?

hullopilllw said:

The main concern of US gov is to stop China's economic development and growth at all cost. Don't the last 4 years already gave us obvious clues ?

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Yes, and they should be shown that their main concern is untenable and will have to change. I advocate harsh measures like pharmaceutical embargoes to get that point across.

The U.S. is so hypocritical:

US drafts rule to allow Huawei and US firms to work together on 5G standards, sources say

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• The U.S. Department of Commerce is close to signing off on a new rule that would allow U.S. companies to work with China’s Huawei Technologies on setting standards for next generation 5G networks, people familiar with the matter said.
• The Commerce Department placed Huawei on its “entity list” last May, citing national security concerns. The listing restricted sales of U.S. goods and technology to the company and raised questions about how U.S. firms could participate in organizations that establish industry standards.
• The rule, which could still change, essentially allows U.S. companies to participate in standards bodies where Huawei is also a member, the sources said.

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On the other hand, it seems the U.S. is already worried about the "China Standard 2035":

hullopilllw said:

The main concern of US gov is to stop China's economic development and growth at all cost. Don't the last 4 years already gave us obvious clues ?

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Like you said, it has been years. Why do you think there was so much back and forth from the US govt between killing Huawei and letting it go? Why do they still let Intel to sell CPU to the Matebook? Microsoft to sell Windows? Why haven't they forced TSMC to stop honoring all of Hisilicon's contracts from the very beginning? Why wait till now? Oh wait, they're still not acting on it now?

They don't have a through plan/endgame, that's why. At the beginning they probably wanted to push Huawei to the brink of collapse and use that as a bargaining chip in the trade talk, but their plan failed because they underestimated Huawei's resiliency. So they tried to push more, but it felt like a half-assed effort because they haven't even killed a product line, much less the company. News about forcing TSMC to stop working with Huawei has been out there for months, if you really want to kill or do maximum damage to Huawei, why give them all these repeated warnings and threats, but not dealing the blow when they're least prepared?

All these back and forth and hesitation means they don't have an endgame. Of course the US wanted to see Huawei (and other representatives of China's tech growth) collapse, but when you throw punches you risk getting punched. China is a major market and world manufacturing hub so they're capable of punching back if needed. It won't kill, but it will hurt. The US does not look like they have the determination to take these hits. And that's before COVID-19 even happened! Now with unprecedented unemployment rate, with the world's worst-by-far infection numbers, with the car and aviation industry in tatters, will Trump be willing to set another bomb off in the US tech sector?

The thing is, even if the US is determined to follow through on everything they were rumored to do, it is still very unlikely that they can kill Huawei, not to mention killing China's tech growth. Maybe they could force Huawei to stop selling cellphones and laptops for a few years, but not much beyond that. Huawei could turn into an upper stream supplier in consumer, automotive and industrial electronics, continue to be a developer of AI and cloud technology, and still be a 5G equipment giant. They have plenty of ways to not only survive but live well.

On the other hand, let's skip discussing China's direct retaliation, because the indirect part could be far more impactful. A "x% tech export ban" pushed to the extreme will effectively forces China to double down on not buying from US companies, even for parts not yet banned. They will also pour huge investments to build up competitors to essential US suppliers, even in high-risk low-profit fields that people were not interested in before. It also encourages foreign companies outside the US to de-Americanize their tech base so they would not be forced to quit the Chinese market one day.

These effects may not be obvious in the short term, but in the long run they could be very damaging to the US tech sector.

hullopilllw said:

Please note that TSMC will require approval from their gov in order to build fab with their latest node in US. As much as a lapdog the DPP admin is, I don't think they will be dumb enough to give away their main crown jewel. They themselves should fully know well that US is only making of tw island to antogonise China, and will be abandoned to their own fate once their value is lost.

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TSMC will not build fab in the US to prevent US espionage.

Once Intel catches up to TSMC, US will have even less need to help them against China.

Mark Liu, chairman of TSMC, told an analyst conference last week: "We are now actively evaluating the U.S. fab plan. But as I told the investors before, there is a cost gap, which is hard to accept at this point."

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Unless US gov't fronts the cost, I don't see TSMC doing this.

superdog said:

These effects may not be obvious in the short term, but in the long run they could be very damaging to the US tech sector.

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There's no question about the long-term damage to the US tech sector.

More than half of all semiconductors pass through China, whether they are consumed locally or re-exported.
China consumes more smartphones than the rest of the developed world for example.

If there's a realistic risk of being cut off from US technology, then it makes financial sense for Chinese companies to develop alternatives.

1. Given the level of technology demand and therefore sales revenue, there is more than enough money to develop and sustain a world-class technology industry that is independent of the USA. It's then becomes a question of how long this will take.
2. China also has access to a large enough technology talent pool to do this.

localizer said:

TSMC will not build fab in the US to prevent US espionage.

Once Intel catches up to TSMC, US will have even less need to help them against China.

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Unless US gov't fronts the cost, I don't see TSMC doing this.

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Good luck in getting the US government and the state authorities to cough up $20+ billion in subsidies for a 2nm TSMC fab.

And then Intel will demand subsidies, and then Global Foundries.