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Before the open, Intel 168B market cap, TSM 184B market cap. TSM is on the move in all nodes, mems, sensors and energy sources of all types and functions at the nanotech scale. Combined with Info packaging which I feel many grossly underestimate the impact of, I feel TSM is on the move. Semi technology is not just about semis, but manufacturing many things and functions at a scale that was unimaginable just a few years ago. TSM will not be just a straight semiconductor company, but in the future a true master at manufacturing a broad range of devices at a nanotech level. MEMS, sensors, and energy sources are just the beginning. I wouldn't be surprised if TSM became a contract manufacturer of nanometer scale robots and machines. All a nanobot would be is a very complex MEM, making this the next great area of growth for a whole range of companies involved in the semi sector from materials, fabrication equipment, manufacturing, assembly and even software/firmware. Memory is the only area I haven't seen TSM master and who knows what may be under their sleeve. For full disclosure, I have had a substantial position in TSM for fifteen years.
Given the size and industry strength of TSMC they can probably do whatever they want. They have already moved into packaging with CoWas and InFO. I had a conversation with some bankers about TSMC buying Imagination Technologies. I was against the idea but it is certainly possible and TSMC buying Cadence has already been discussed. It really is a good question: Now that TSMC dominates the foundry business what will they do next?
Hopefully TSMC learns from Intel's acquisition mistakes and does not repeat them.
Dan, I was thinking more of Vishay, who is a very small bite, but would fill in the bottom end. Vishay will provide many of the small sensors and critical items for robotics. Fastenal is an example in another sector that I feel is where Vishay now sits in the tech industry and Fastenal was one of the fastest growing stocks and businesses from 2000 to 2010. I feel TSM will provide the higher end of very small robotics and Vishay will provide the lower end, especially in very small but not ultra small robots. The synergies added to TSM being able to apply advanced technologies on the lower end and to combine some R&D efforts would be immediately accretive to the value of the transaction and would present no conflicts. I also see AMAT providing key tooling to make much of the ultra small robots and many other micro machines. It's all about extending the platform. Full Disclosure VSH has been a long term holding of mine. We are in for a micro robotics revolution, it's a no brainer.
I don't know about Imagination Tech, but it would make sense for TSMC to vertically integrate into IP and design tools. Building design tools in conjunction with the process (which to an extent already happens), would allow TSMC to lower design costs and allow it's customers to hit the market even faster.
The model that you are describing, vertical integration including Fabs, EDA tools and IP, has been the IDM model during the 80's up to mid 90's. Then all the IDM have externalized EDA, and the IP business has emerged.
I don't think that a big player like TSMC could be agile as needed to supply very innovative EDA, and develop advanced and complexes IP.
The semi industry deseperatly need innovation to fuel growth, and the larger a company, the most difficult it becomes to really innovate. TSMC is very, very good at filling fabs and developing new processes, innovate in the manufacturing area. EDA and IP development just require different skills, to my opinion.
PS: Imagination GPU? Acquisition from Apple would really make sense!
MIPS CPU IP? Acquisition from Verisilicon would complete their IP offer: DSP from LSI Logic + GPU from Vivante
Why would TSMC buy a GPU IP??
