The Japanese media recently reported that the presence of TSMC, the world’s largest semiconductor producer, has been strengthened against the backdrop of a severe global semiconductor shortage; “TSMC’s unexpected strength is now causing anxiety in the U.S.”.
According to a Nikkei Chinese website report titled “TSMC’s Powerfulness Causes U.S. Anxiety” on the 29th, the presence of TSMC, the world’s largest semiconductor producer, has been strengthened against the backdrop of severe global semiconductor shortage, and has now developed to a rare state of affairs in which governments have requested TSMC’s assistance in increasing production through Taiwan authorities.
The newspaper pointed out that it is rare for a company’s movement to move the world so much, and tried to find out “why TSMC is so powerful”?
The world’s semiconductor production is now concentrated in TSMC one after another. Major companies such as Apple, Qualcomm, Sony, and others are going to Taiwan every day to try to get TSMC semiconductors in their products because it will influence the performance of their products.
TSMC was founded in 1987, a year that contains profound significance. Before that, in 1986, Japan and the United States signed the “Japan-U.S. Semiconductor Agreement” after a violent trade dispute over semiconductors.
The “horizontal division of labor” devised by the U.S. was intended to allow the U.S. to focus on upstream design and development, not owning factories, and leaving the production with huge investment but little added value to Asian companies. Keenly sensing this huge change was Taiwan, which did not have any resources.
The Taiwanese authorities at the Time immediately selected Zhang Zhongmou, who had been in the U.S. semiconductor industry for a long time, stating that the world semiconductor business was about to change dramatically and that it was an opportunity for Taiwan, which did not have any resources, to return to Taiwan to start a semiconductor company.
Not surprisingly, in the second year of the Japan-U.S. Semiconductor Agreement, TSMC, which was pioneered by Chang Chung-Mou, received production orders one after another as the U.S. advanced the horizontal division of labor, and soon entered a growth phase.
This trend accelerated further in the 2010s with the introduction of smartphones. TSMC invested the huge amount of capital gained through foundry work into R&D of manufacturing technology, which in turn led to further foundry orders, creating a virtuous cycle and further increasing its presence.
The U.S. has promoted factory-less operations through a horizontal division of labor of its own design, giving birth to powerful companies such as Qualcomm and Nvidia; however, the shift to intangible assets such as patents and data, and the loss of production to Asia has resulted in a deepening division of labor, and “TSMC’s unexpected strength is now making the U.S. uneasy.
The U.S. waging a confrontation with the Chinese Communist Party also makes the geopolitical risks more prominent, further increasing TSMC’s presence. The U.S., which once lost production to Asia, is now desperately trying to pull TSMC to invest in the U.S. for security and safety reasons.
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