So it seems like one way that the world could go is:
China develops a domestic semiconductor fab industry that’s not at the cutting edge, but close, so that it’s less dependent on Taiwan’s TSMC
China invades Taiwan, destroying TSMC, ending up with a compute advantage over the US, which translates into a military advantage
(which might or might not actually be leveraged in a hot war).
I could imagine China building a competent domestic chip industry. China seems more determined to do that than the US is.
Though notably, China is not on track to do that currently. It’s not anywhere close to it’s goal producing 70% it’s chips, by 2025.
And if the US was serious about building a domestic cutting-edge chip industry again, could it? I basically don’t think that American work culture can keep up with Taiwanese/TSMC work culture, in this super-competitive industry.
TSMC is building fabs in the US, but from what I hear, they’re not going well.
(While TSMC is a Taiwanese company, having a large fraction of TSMC fabs in in the US would preement the scenario above. TSMC fabs in the US counts as “a domestic US chip industry.”)
Building and running leading node fabs is just a really really hard thing to do.
I guess the most likely status scenario is the continuation of the status quo where China and the US continue to both awkwardly depend on TSMC’s chips for crucial military and economic AI tech.
I’m not that confident about how the Arizona fab is going. I’ve mostly heard second hand accounts.
I’m very confident that TSMC’s edge is more than cheap labor. It would be basically impossible for another country, even one with low median wages, to replicate TSMC. Singapore and China have both tried, and can’t compete. At this point in time, TSMC has a basically insurmountable human capital and institutional capital advantage, that enables it to produce leading node chips that no other company in the world can produce. Samsung will catch up, sure. But by the time they catch up to the TSMC’s 2024 state of the art, TSMC will have moved on to the next node.
My understanding is that, short of TSMC being destroyed by war with mainland China, or some similar disaster, it’s not feasible for any company to catch up with TSMC within the next 10 years, at least.
I’m very confident that TSMC’s edge is more than cheap labor.
They have cumulative investments over the years, but based on accounts of Americans who have worked there, they don’t sound extremely advanced. Instead they sound very hard working, which gives them a strong ability to execute. Also, I still think these delays are somewhat artificial. There are natsec concerns for Taiwan to let TSMC diversify, and TSMC seems to think it can wring a lot of money out of the US by holding up construction. They are, after all, a monopoly.
Samsung will catch up, sure. But by the time they catch up to the TSMC’s 2024 state of the art, TSMC will have moved on to the next node. ... it’s not feasible for any company to catch up with TSMC within the next 10 years, at least.
Is Samsung 5 generations behind? I know that nanometers don’t really mean anything anymore, but TSMC and Samsung’s 4 nm don’t seem 10 years apart based on the tidbits I get online.
Liu said construction on the shell of the factory had begun, but the Taiwanese chipmaking titan needed to review “how much incentives … the US government can provide.”
Is Samsung 5 generations behind? I know that nanometers don’t really mean anything anymore, but TSMC and Samsung’s 4 nm don’t seem 10 years apart based on the tidbits I get online.
I’m not claiming they’re 10 years behind. My understanding from talking with people is that TSMC is around 2 to 3 years behind TSMC. My claim is that Samsung and TSMC are advancing at ~the same rate, so Samsung can’t close that 2 to 3 year gap.
As you note, TSMC is building fabs in the US (and Europe) to reduce this risk.
I also think that it’s worth noting that, at least in the short run, if the US didn’t have shipments of new chips and was at war, the US government would just use wartime powers to take existing GPUs from whichever companies they felt weren’t using them optimally for war and give them to the companies (or US Govt labs) that are.
Plus, are you really gonna bet that the intelligence community and DoD and DoE don’t have a HUUUUGE stack of H100s? I sure wouldn’t take that action.
I meant more “already in a data center,” though probably some in a warehouse, too.
I roll to disbelieve that the people who read Hacker News in Ft. Meade, MD and have giant budgets aren’t making some of the same decisions that people who read Hacker News in Palo Alto, CA and Redmond, WA would.
No clue if true, but even if true, but DARPA is not at all a comparable to Intel. Entity set up for very different purposes and engaging in very different patterns of capital investment.
Also very unclear to me why R&D is relevant bucket. Presumably buying GPUs is either capex or if rented, is recognized under a different opex bucket (for secure cloud services) than R&D ?
My claim isn’t that the USG is like running its own research and fabs at equivalent levels of capability to Intel or TSMC. It’s just that if a war starts, it has access to plenty of GPUs through its own capacity and its ability to mandate borrowing of hardware at scale from the private sector.
This makes no sense. Wars are typically existential. In a hot war with another state, why would the government not use all of industrial capacity that is more useful to make weapons to make weapons. It’s well documented that governments can repurpose unnecessary parts of industry (say training Grok or an open source chatbot) into whatever else.
Biden used them for largely irrelevant reasons. This indicates that with an actual war, usage would be wider and more extensive.
So it seems like one way that the world could go is:
China develops a domestic semiconductor fab industry that’s not at the cutting edge, but close, so that it’s less dependent on Taiwan’s TSMC
China invades Taiwan, destroying TSMC, ending up with a compute advantage over the US, which translates into a military advantage
(which might or might not actually be leveraged in a hot war).
I could imagine China building a competent domestic chip industry. China seems more determined to do that than the US is.
Though notably, China is not on track to do that currently. It’s not anywhere close to it’s goal producing 70% it’s chips, by 2025.
And if the US was serious about building a domestic cutting-edge chip industry again, could it? I basically don’t think that American work culture can keep up with Taiwanese/TSMC work culture, in this super-competitive industry.
TSMC is building fabs in the US, but from what I hear, they’re not going well.
(While TSMC is a Taiwanese company, having a large fraction of TSMC fabs in in the US would preement the scenario above. TSMC fabs in the US counts as “a domestic US chip industry.”)
Building and running leading node fabs is just a really really hard thing to do.
I guess the most likely status scenario is the continuation of the status quo where China and the US continue to both awkwardly depend on TSMC’s chips for crucial military and economic AI tech.
Hold on. The TSMC Arizona fab is actually ahead of schedule. They were simply waiting for funds. I believe TSMC’s edge is largely cheap labor.
https://www.tweaktown.com/news/97293/tsmc-to-begin-pilot-program-at-its-arizona-usa-fab-plant-for-mass-production-by-end-of-2024/index.html
I’m not that confident about how the Arizona fab is going. I’ve mostly heard second hand accounts.
I’m very confident that TSMC’s edge is more than cheap labor. It would be basically impossible for another country, even one with low median wages, to replicate TSMC. Singapore and China have both tried, and can’t compete. At this point in time, TSMC has a basically insurmountable human capital and institutional capital advantage, that enables it to produce leading node chips that no other company in the world can produce. Samsung will catch up, sure. But by the time they catch up to the TSMC’s 2024 state of the art, TSMC will have moved on to the next node.
My understanding is that, short of TSMC being destroyed by war with mainland China, or some similar disaster, it’s not feasible for any company to catch up with TSMC within the next 10 years, at least.
So, from their site “TSMC Arizona’s first fab is on track to begin production leveraging 4nm technology in first half of 2025.” You are probably thinking of their other Arizona fabs. Those are indeed delayed. However, they cite “funding” as the issue.[1] Based on how quickly TSMC changed tune on delays once they got Chips funding, I think it’s largely artificial, and a means to extract CHIPS money.
They have cumulative investments over the years, but based on accounts of Americans who have worked there, they don’t sound extremely advanced. Instead they sound very hard working, which gives them a strong ability to execute. Also, I still think these delays are somewhat artificial. There are natsec concerns for Taiwan to let TSMC diversify, and TSMC seems to think it can wring a lot of money out of the US by holding up construction. They are, after all, a monopoly.
Is Samsung 5 generations behind? I know that nanometers don’t really mean anything anymore, but TSMC and Samsung’s 4 nm don’t seem 10 years apart based on the tidbits I get online.
Liu said construction on the shell of the factory had begun, but the Taiwanese chipmaking titan needed to review “how much incentives … the US government can provide.”
I’m not claiming they’re 10 years behind. My understanding from talking with people is that TSMC is around 2 to 3 years behind TSMC. My claim is that Samsung and TSMC are advancing at ~the same rate, so Samsung can’t close that 2 to 3 year gap.
Oh yeah I agree. Misread that. Still, maybe not so confident. Market leaders often don’t last. Competition always catches up.
As you note, TSMC is building fabs in the US (and Europe) to reduce this risk.
I also think that it’s worth noting that, at least in the short run, if the US didn’t have shipments of new chips and was at war, the US government would just use wartime powers to take existing GPUs from whichever companies they felt weren’t using them optimally for war and give them to the companies (or US Govt labs) that are.
Plus, are you really gonna bet that the intelligence community and DoD and DoE don’t have a HUUUUGE stack of H100s? I sure wouldn’t take that action.
What, just sitting in a warehouse?
I would bet that the government’s supply of GPUs is notably smaller than that of Google and Microsoft.
I meant more “already in a data center,” though probably some in a warehouse, too.
I roll to disbelieve that the people who read Hacker News in Ft. Meade, MD and have giant budgets aren’t making some of the same decisions that people who read Hacker News in Palo Alto, CA and Redmond, WA would.
I don’t think the budgets are comparable. I read recently that Intel’s R&D budget in the 2010s was 3x bigger than all of DARPA.
No clue if true, but even if true, but DARPA is not at all a comparable to Intel. Entity set up for very different purposes and engaging in very different patterns of capital investment.
Also very unclear to me why R&D is relevant bucket. Presumably buying GPUs is either capex or if rented, is recognized under a different opex bucket (for secure cloud services) than R&D ?
My claim isn’t that the USG is like running its own research and fabs at equivalent levels of capability to Intel or TSMC. It’s just that if a war starts, it has access to plenty of GPUs through its own capacity and its ability to mandate borrowing of hardware at scale from the private sector.
When I look at the current US government it does not seem to be able to just take whatever they want from big companies with powerful lobbyists.
Wartime powers let governments do whatever they want essentially. Even recently Biden has flexed the defense production act.
https://www.defense.gov/News/Feature-Stories/story/article/2128446/during-wwii-industries-transitioned-from-peacetime-to-wartime-production/
Did he do it in a way that hurt the bottom line of any powerful US company? No, I don’t think so.
While the same power that existed in WWII still exist on paper today, the US government is much less capable to take actions.
We’re not at war. If we were in a war with real stakes, I’d expect to see those powers used much more aggressively.
This makes no sense. Wars are typically existential. In a hot war with another state, why would the government not use all of industrial capacity that is more useful to make weapons to make weapons. It’s well documented that governments can repurpose unnecessary parts of industry (say training Grok or an open source chatbot) into whatever else.
Biden used them for largely irrelevant reasons. This indicates that with an actual war, usage would be wider and more extensive.
I’d flag that I think it’s very possible TSMC will be very much hurt/destroyed if China is in control. There’s been a bit of discussion of this.
I’d suspect China might fix this after some years, but would expect it would be tough for a while.
https://news.ycombinator.com/item?id=40426843
You mean if they’re in control of Taiwan?
Yes, the US would destroy it on the way out.
Yea