Question Taiwan Report: Intel has reached an agreement with TSMC

[mikegg]

Mods: if this is true, it should deserve its own thread. If it's not true, please feel free to delete it.

https://m.hexus.net/business/news/components/144379-amd-intel-battle-tsmc-capacity-says-report/

Insiders talking to the Taiwanese newspaper have indicated the following:

• Intel has reached an agreement with TSMC
• TSMC will begin mass production of Intel CPUs and/or GPUs next year
• Intel chips will be fabricated on TSMC's 7nm optimised version of its 6nm process. (I'm not sure if that means TSMC N7P, N7+, or N6.)

No details on the agreement has come out.

My personal predictions on an agreement:

TSMC sees this as an opportunity to force Intel out of the race for bleeding-edge nodes. TSMC will probably allow Intel to keep its 10nm and above nodes since those aren't a threat to them. TSMC may allow Intel to finish its 7nm nodes as well because let's be honest, Intel releasing its 7nm node in the year 2022/2023 is not a threat to TSMC. Intel will stop developing a node below 7nm after signing an agreement with TSMC. Over the next 5 years or so, Intel will sell off all of its existing fabs and become fabless. Intel has no leverage in this deal and TSMC will use this opportunity to completely remove Intel as a threat.

This is just pure speculation but I think Intel did negotiate with Samsung to use a partnership with Samsung as a leverage point in a deal with TSMC. But ultimately, Intel knows going with TSMC is guaranteed access to the best node. In addition, Intel knows signing with TSMC is a punch to Nvidia and two punches to AMD.

 

[ThatBuzzkiller]

LoL capitalist until you cannot compete, then bring on protectionism...

Closer to state capitalism which is definitely protectionist rather than laissez-faire capitalism so those two terms you mentioned are not mutually exclusive in their purest form ...

The world is a zero-sum game. It's either American allies win or America itself winning so it's pretty much illogical for a patriot to not pick the latter ...

 

[Exist50]

The world is a zero-sum game

The fundamental premise behind trade is that the world is not a zero sum game.

 

[Failnaught]

If it is true, the US government needs to realize that fab technology is critical in a lot of ways and act to keep leading edge fabs operating in the US. If we can spent trillions on coronavirus relief, surely they can find a few billion or even tens of billions to insure such fabs remain in the US, operating under the control of US company/companies (a JV seems the most likely way to accomplish this)

Honestly Intel, TSMC, Samsung, Toshiba, and Micron ought to get together, co-develop process technology, and license its use by the various companies (sharing cost based on how many wafers each runs so the ones who use more pay a larger share so they can't squeeze the others out) It would probably take the US, Taiwan, Japan and South Korea governments working together, along with those companies, to make this happen.

But is Intel's failure from a lack of money? Of course money helps (for players with small volume like SMIC especially) but Intel just spent billions on stock buybacks.

 

[ThatBuzzkiller]

The fundamental premise behind trade is that the world is not a zero sum game.

In theory, but in practice the American people get no added value of logic fabrication since Taiwan is succeeding. The American public are missing out on filling their own coffers because of the decreased tax revenue from Intel's decline and worst of all a key technology is no longer firmly in their control ...

The American public should be outraged at American firms for not supporting American sourced technology since it'll mean less jobs available in the domestic economy and ultimately a decline in technological leadership but I guess they don't grasp the true value of this title either ...

Soon America will have many of their own 'sputnik' moments which will symbolize their total incompetence at competing against foreign technology especially from those of hostile foreign states like China. Americans should be ashamed that they're progressing into a backwater nation with weak technology to boot ...

 

[sdifox]

In theory, but in practice the American people get no added value of logic fabrication since Taiwan is succeeding. The American public are missing out on filling their own coffers because of the decreased tax revenue from Intel's decline and worst of all a key technology is no longer firmly in their control ...

The American public should be outraged at American firms for not supporting American sourced technology since it'll mean less jobs available in the domestic economy and ultimately a decline in technological leadership but I guess they don't grasp the true value of this title either ...

Soon America will have many of their own 'sputnik' moments which will symbolize their total incompetence at competing against foreign technology especially from those of hostile foreign states like China. Americans should be ashamed that they're progressing into a backwater nation with weak technology to boot ...

It's Intel's management that decided they don't need to update their design and process. Just touch up the last Lake and spend your money buying back stocks. Americans decided to not compete. How is that anyone else's fault?

AMD had to go to TSMC because Global Flow failed to deliver.

 

[Exist50]

In theory, but in practice the American people get no added value of logic fabrication since Taiwan is succeeding

You're joking, right? You don't think all of the products that TSMC fabs benefit Americans?

The American public should be outraged at American firms for not supporting American sourced technology since it'll mean less jobs available in the domestic economy

Again, this is Econ 101. Trying to do everything yourself is just inefficient. Mercantilism died centuries ago.

 

[ThatBuzzkiller]

You're joking, right? You don't think all of the products that TSMC fabs benefit Americans?

Not nearly as much as the products produced by American fabs since they generate a higher value for the domestic economy ...

Americans now have to share this generated value with Taiwan instead of keeping it all for themselves ...

Again, this is Econ 101. Trying to do everything yourself is just inefficient. Mercantilism died centuries ago.

Mercantilism is far from dead. Even now it is not all that fundamentally different to state capitalism practiced today by many nation. The greatest civilizations in the world developed most when protectionism erupted ...

America is on the cusp of losing nearly all of it's semiconductor industry which holds so much strategic value because it is taking inadequate measures to defend it ...

 

[AnandThenMan]

When you think about AMD's failure to run a fab competitively ended up being good luck. It forced AMD to dump their fab (at horrendous cost in many ways) but long term that's where the market was moving.

 

[Exist50]

Americans now have to share this generated value with Taiwan instead of keeping it all for themselves ...

You're ignoring the benefits of cheaper, more widely available goods that would not exist if (e.g. America) had to produce everything for itself. Not to mention the opportunity cost for all the workers focused there.

Mercantilism is far from dead.

Dude...

America is on the cusp of losing nearly all of it's semiconductor industry which holds so much strategic value because it is taking inadequate measures to defend it ...

"Defending" America's semiconductor industry (which really doesn't need defending) would be giving the incentives for companies to competitively participate. The government bailing out failing companies doesn't solve anything. Plenty of countries have tried and failed to sanction sanction themselves into relevancy

 

[ThatBuzzkiller]

You're ignoring the benefits of cheaper, more widely available goods that would not exist if (e.g. America) had to produce everything for itself. Not to mention the opportunity cost for all the workers focused there.

Cheap goods, sure but with a vital and strategic industry such as logic fabrication ? I highly doubt it's worth the cost of losing control of a critical piece of the supply chain ...

"Defending" America's semiconductor industry (which really doesn't need defending) would be giving the incentives for companies to competitively participate. The government bailing out failing companies doesn't solve anything. Plenty of countries have tried and failed to sanction sanction themselves into relevancy

America's semiconductor industry is pretty much dead aside from chip design. Even Micron won't last much longer as they'll soon have to make a complete retreat from NAND module market into DRAM module production. Soon they won't be able to produce any electronic components left whether simple or advanced ...

 

[mxnerd]

Blaming Asian companies taking the lead?

Michio Kaku: US has the worst educational system known to science

 

[moinmoin]

Why should Apple care if Intel gets access to the same process they have? Apple does not compete with Intel, unless Apple starts selling their SoCs on the open market for third parties to make Windows ARM PCs out of. No one should hold their breath waiting for that!

Sorry what? Of course Apple and Intel compete for the foundry capacity if Intel does get there, such capacity is never infinity. And Apple as a first mover client is directly financing the creation and building of a new node including its designated capacity. TSMC would gamble a lot in this relationship if Intel were to get similar access without having the same obligations as Apple, that much should be obvious. Whether Apple and Intel then compete in the same markets with the resulting products or not has zero influence on this situation.

 

[DrMrLordX]

@ThatBuzzkiller

If Americans should be outraged about anything, it's that Intel destroyed most of our domestic silicon fabrication industry other than itself.

 

[Thibsie]

US loves monopolies or whatever looks like it the most possible way (not that EU is perfect on the matter, mind you).

 

[mikegg]

Blaming Asian companies taking the lead?

Michio Kaku: US has the worst educational system known to science

In Asia, smart students are respected. Being smart is attractive. Saying you're in the science field or academic field is cool.

In the U.S., smart students are bullied until they don't want to be smart anymore. Being smart means you can't get girls. Being anti-science is cool.

In the last 200 years, Asia struggled to compete globally. But now that its infrastructure is close to the West, its core value of education is finally paying off in high value industries like semiconductors.

The last frontier for Asia to catch up on is software. But that will happen in the next decade or two as well.

 

[mikegg]

LoL capitalist until you cannot compete, then bring on protectionism...

Isn't this just Huawei and Tiktok? Maybe previous examples include foreign oil-rich countries?

This sets dangerous precedence in my opinion. It makes countries and companies wearier of relying on U.S. goods, market, and technology.

 

[sdifox]

Isn't this just Huawei and Tiktok? Maybe previous examples include foreign oil-rich countries?

This sets dangerous precedence in my opinion. It makes countries and companies wearier of relying on U.S. goods, market, and technology.

Recent example is US government helped Boeing stop Bombardier's C Series jets from being bought by US airlines because Boeing didn't bother to make a product in that segment of the market. Bombardier now is out of the plane business.

Airbus A220 - Wikipedia

en.m.wikipedia.org

The history of the Airbus A220, the controversial plane Boeing tried to keep out of the US

In the years since the aircraft was announced, controversy has shaped the future of the plane formerly known as the Bombardier CSeries.

www.businessinsider.com

 

[mikegg]

If the american government truly cared about being ahead then they should place sanctions TSMC as well so that they can sink into oblivion in order to let the likes of those in their domestic industry such as Intel to prosper. It should've been mandated in law that american businesses are forced to supply from a domestic foundry even if it meant them coming to an agreement with Intel ...

Damn, this is so backward thinking, it's unbelievable.

First, the Trump government is already setting dangerous precedence by politicizing the business world so much. It's bad business when companies see instability in the government or the government meddles in something it shouldn't.

Second, the U.S. is going to get f'ed if it tries to sink TSMC. It means TSMC will stop making any American chips, including those of Apple, AMD, Qualcomm, and Nvidia. So instead of the iPhone using 5nm SoCs, it will now have to go backward and rely on Intel 14nm or GF 12nm tech. And there's not even close to enough capacity for all American companies. So not only do U.S. chip makers suffer, now suddenly the iPhone is no longer competitive. And guess who benefits? Any non-U.S. chip maker and computer makers. That means Samsung, LG, OnePlus, Huawei, or whatever European makers, etc. benefit hugely.

Lastly, TSMC will never sink. If the U.S. government cuts off TSMC, governments and investors around the world will be more than happy to invest in TSMC to keep it afloat while it transitions away from fabbing for U.S. chipmakers.

It does mean the end of the U.S. semiconductor industry though, maybe even the U.S. computing industry in general.

 

[DrMrLordX]

If the US Gubment sanctions TSMC, parties such as the Kuomintang will gain power. Not a good idea. It would be more in the interest of the US Gubment to prop up TSMC and convince them to move fabrication facilities to the United States, or to build/acquire ones here. It would also make sense to reach out to Samsung and convince them to open/acquire a few fabs here, too.

 

[ThatBuzzkiller]

@ThatBuzzkiller

If Americans should be outraged about anything, it's that Intel destroyed most of our domestic silicon fabrication industry other than itself.

The biggest tragedy of all is going to be the job losses and loss in added value to the national economy ...

We can sit here all day and point fingers at who's to blame but is it going to change the fact that Americans are going to become poorer in general for it ? I'm getting the impression that Americans seem to like this self-destructive behaviour of ending up being more poor so I guess when crap hits the fan then all Americans will be out of luck ?

Last I check there's not much need for tens of thousands of process engineers out on the streets once Intel quits manufacturing ...

 

[mikegg]

The biggest tragedy of all is going to be the job losses and loss in added value to the national economy ...

We can sit here all day and point fingers at who's to blame but is it going to change the fact that Americans are going to become poorer in general for it ? I'm getting the impression that Americans seem to like this self-destructive behaviour of ending up being more poor so I guess when crap hits the fan then all Americans will be out of luck ?

Last I check there's not much need for tens of thousands of process engineers out on the streets once Intel quits manufacturing ...

And you think trying to redacted over a foreign company that is more competitive than an American company is a way to solve this problem?

TSMC produces technology that enables U.S. companies like Apple, AMD, Nvidia, Qualcomm, and to some extent, Google, Amazon, Microsoft, to lead in their respective fields.

Both Taiwan and the U.S. benefit as part of this arrangement.

You're suggesting that only the U.S. should benefit from any trade. Unfortunately, that's not how trade works.

If the U.S. does what you're suggesting, it might as well shut its doors to the outside world. Oh wait, Trump is already trying to do that.

Anyways, you've destroyed this topic and taken it completely off rails. I'm asking mods to lock this.




No profanity in tech.


esquared
Anandtech Forum Director

 

[ThatBuzzkiller]

Damn, this is so backward thinking, it's unbelievable.

First, the Trump government is already setting dangerous precedence by politicizing the business world so much. It's bad business when companies see instability in the government or the government meddles in something it shouldn't.

Second, the U.S. is going to get f'ed if it tries to sink TSMC. It means TSMC will stop making any American chips, including those of Apple, AMD, Qualcomm, and Nvidia. So instead of the iPhone using 5nm SoCs, it will now have to go backward and rely on Intel 14nm or GF 12nm tech. And there's not even close to enough capacity for all American companies. So not only do U.S. chip makers suffer, now suddenly the iPhone is no longer competitive. And guess who benefits? Any non-U.S. chip maker and computer makers. That means Samsung, LG, OnePlus, Huawei, or whatever European makers, etc. benefit hugely.

Lastly, TSMC will never sink. If the U.S. government cuts off TSMC, governments and investors around the world will be more than happy to invest in TSMC to keep it afloat while it transitions away from fabbing for U.S. chipmakers.

It does mean the end of the U.S. semiconductor industry though, maybe even the U.S. computing industry in general.

Samsung has their own foundry and they would never use TSMC especially if it got hit with American sanctions since it would mean potentially getting rid of their competitor for good. The others don't design chips so they don't have a choice at all and I laugh at the thought of a european mobile device manufacturer existing.

Also why would TSMC open themselves to Hauwei again ? You realize them doing so will only inevitably speed reunification with mainland China, right ?

 

[DrMrLordX]

Last I check there's not much need for tens of thousands of process engineers out on the streets once Intel quits manufacturing ...

That is not going to happen. IBM's old fabs are still running (as a part of GF), GF's fabs are still running. Demand for product is there, and Intel has a large amount of fab capacity. Not as much as TSMC, but then, right now, Intel has only one major customer - itself. Ink a licensing deal, build a few extra fabs state-side for TSMC (or Samsung, but right now it's looking like TSMC), retool the existing fabs, and Intel is still in the game. Just not with their own home-grown nodes, and they'd be a vassal of a foreign company (more or less). Such is the price of failure.

 

[Maxima1]

Blaming Asian companies taking the lead?

Michio Kaku: US has the worst educational system known to science

We take in foreigners to do STEM (consequently putting significant downward pressure on STEM compensation), so our people can do service jobs that aren't as cognitively demanding but paying just as well or better. Who wants to do sciences/engineering for four years and on top do 4-7 years for PhD and postdoc? There's a reason why kids of the more affluent are less likely to do engineering/science.

The worry about US K-12 educational system is based on comparisons to homogeneous nations of whites or Asians. The "superior" educational systems of Canada, UK, Japan, etc. don't look so much different when you actually compare like vs. like.

In Asia, smart students are respected. Being smart is attractive. Saying you're in the science field or academic field is cool.

In the U.S., smart students are bullied until they don't want to be smart anymore. Being smart means you can't get girls. Being anti-science is cool.

It has a lot to do with less reward for the time spent going for more rigorous academic content. Would you go from US to China or India, for example? For them, that's different. My first sentence in the post applies here, too.

Taking math or science AP or IB classes/exams is not going to hurt your standing. What you're describing is harassment of nerds, but that's not really about taking science and math classes i.e. about looks, poor social skills, etc..

 

[Genx87]

Mods: if this is true, it should deserve its own thread. If it's not true, please feel free to delete it.

https://m.hexus.net/business/news/components/144379-amd-intel-battle-tsmc-capacity-says-report/

Insiders talking to the Taiwanese newspaper have indicated the following:

• Intel has reached an agreement with TSMC
• TSMC will begin mass production of Intel CPUs and/or GPUs next year
• Intel chips will be fabricated on TSMC's 7nm optimised version of its 6nm process. (I'm not sure if that means TSMC N7P, N7+, or N6.)

No details on the agreement has come out.

My personal predictions on an agreement:

TSMC sees this as an opportunity to force Intel out of the race for bleeding-edge nodes. TSMC will probably allow Intel to keep its 10nm and above nodes since those aren't a threat to them. TSMC may allow Intel to finish its 7nm nodes as well because let's be honest, Intel releasing its 7nm node in the year 2022/2023 is not a threat to TSMC. Intel will stop developing a node below 7nm after signing an agreement with TSMC. Over the next 5 years or so, Intel will sell off all of its existing fabs and become fabless. Intel has no leverage in this deal and TSMC will use this opportunity to completely remove Intel as a threat.

This is just pure speculation but I think Intel did negotiate with Samsung to use a partnership with Samsung as a leverage point in a deal with TSMC. But ultimately, Intel knows going with TSMC is guaranteed access to the best node. In addition, Intel knows signing with TSMC is a punch to Nvidia and two punches to AMD.

Nvidia has to be getting a little nervous. Only so many wafers can run through TSMC's FABs. TSMC have any new FABs being built out right now?