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It looks like TSM will become an even more dominant player after Intel continues to fall farther and farther behind. I think Samsung since they make their own products cannot compete. It looks like this leaves TSM as the sole source for many fab operations. I don't see any other source with nearly the financial and technical resources to compete. I have no doubt their new fabs will operate at full capacity, especially as they won't compete with their customers. Any thoughts or comments appreciated.
The China trade war situation represents a +/- for TSMC:
+ for TSMC where sanctions and tariffs are mandating customers use TSMC for advanced nodes
- for TSMC as it locks away major Chinese corporations and China as a customer base for TSMC's products
The other variable for TSMC is there are still classes of technology they dont' really produce -- NAND, DRAM, etc. It's possible some of these classes of products become more valuable over time and that tips the balance a little bit.. (But I don't see these things ever becoming more important than what TSMC can do).
The China trade war situation represents a +/- for TSMC:
+ for TSMC where sanctions and tariffs are mandating customers use TSMC for advanced nodes
- for TSMC as it locks away major Chinese corporations and China as a customer base for TSMC's products
The other variable for TSMC is there are still classes of technology they dont' really produce -- NAND, DRAM, etc. It's possible some of these classes of products become more valuable over time and that tips the balance a little bit.. (But I don't see these things ever becoming more important than what TSMC can do).
Agreed. While memory is a commodity, everything TSMC produces for its customers is a differentiated (non commodity) product and almost none of it is second sourced or could economically be. I guess that's obvious, but it never really struck me before that this is a sort of fundamental price/margin support for TSMC. And TSMC gets to make the highest value, most differentiated designs.
The other variable for TSMC is there are still classes of technology they dont' really produce -- NAND, DRAM, etc. It's possible some of these classes of products become more valuable over time and that tips the balance a little bit.. (But I don't see these things ever becoming more important than what TSMC can do).
correct me if I'm wrong, Isn't TSMC's biggest strength the fact that they focus on their core business and avoid conflicts of interest?
Unlike Samsung, which make chips for Apple while also competing with Apple, TSMC maintains a neutral stance. Clients likely appreciate TSMC's dedication to being a foundry-only business, avoiding potential conflicts and ensuring their intellectual property remains secure
Obviously, TSMC's dominance is growing with double digit growth extending further into the future. Although chances seem low in the near-term, China aggression in Taiwan, Philippines, and the region could ramp up at any time with escalation devastating to the world economy. TSMC could hit the kill switch. A masterplan for a US-focused semi manufacturing and ecosystem has to solidify soon with Intel fabs important at the core. Many other fab companies, both large and small, will be involved. The "Chip 4" alliance is the closest plan I'm aware of.
Anyone else optimistic that a masterplan is in the works?
The answer to your question Art is yes, TSMC will continue to dominate the foundry business due to lack of competition. Just as NVIDIA continues to dominate AI.
