America’s Big Chipmaking Blunder

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After spending 20 years as a salaried manager in corporate America I can truly say that management is the root of Americas lack of innovation. The majority of managers are focused on meetings, talking on the phone, and working on networking (talking to people for no reason).

The two brightest flames of US advanced manufacturing (Intel and Boeing) have recently made such massive and historic missteps in the last decade. It's really sad.

The real reason the US and all western nations missed out on this wave is because corporate heads wanted to produce their products in a cheap environment to maximize profits. Now all of the supply chains and the skilled workers are in Asia.

Morris Chang, the founder of TSMC was a director at Texas Instruments, he was passed up for promotions to less capable peers and saw the glass ceiling for ethnic Chinese. He went back to Taiwan to set up TSMC and the rest was history.

This is what happens when a stock price/profit focused CEO controls a tech company.

Intel: spends $4bn developing the tech but doesn't want to spend $0.2bn buying even a single development unit to use the tech

What US did to Japanese semiconductor industry is really disgusting….RIP Toshiba Semiconductor

ASML had the forsight to buy the US company who pioneered EUV. Intel could have bought it. Applied Materials could have bought it. None thought it was worth the effort.

As a person who used to work in the semiconductor industry for decades: In a society that only believes in laissez-faire capitalism, it's only corporate profits that matters. That leads to all sorts of out-sourcing to increase corporate profits. Everything moves to cheaper locations that can do the work. Other issues like national (or world) security & stability don't mean much to corporations who are slaves to their quarterly returns.

The US really woke up late. ASML bought a stake in the Zeiss subsidiary that makes these crazy mirror focusing systems. ASML only paid a billion dollars for that share. Even just a billion can do great things if you know how to spend it.

Regarding the chip shortage: For 4 years, I worked at a Texas-based semiconductor fabrication plant. (DUV and I-line) Our fab has been running 24/7 all throughout the pandemic. The bottleneck problem is, all 300mm wafers have to be put on a train, then a cargo ship or a plane, shipped to either China, Taiwan, Philippines, Japan, South Korea and Malaysia to be cut, then put into their final chip form, then sent back the the US, where they have to be redistributed, then installed wherever they are needed. Some are even installed on their circuit boards after this process, due to the circuitry ALSO being created overseas. There is no facility in the US, that can do this final process in a high capacity scale, nor plans to do this, because it’s cheaper to outsource to other countries. Not forgetting the fact that the machinery needed to do these complicated procedures, are all patented and built by Asian and Norwegian countries. Now, think about it pragmatically; If your country was just getting back to work from the pandemic, who do you think they would prioritize? Themselves or US (who had a president that downplayed Covid, blamed China for it in the first place AND by proxy, caused horrible crimes against citizens of any and all, Asian decent) ? I say that only because right after we had gotten shipments caught up after Trumps “tariff war” debacle (which is a tax that WE, the consumers pay) then we got hit by the pandemic. Once gain, we were having to store excess wafers due to the supply chain being backed up. We have $millions of dollars worth of chips that are STILL waiting to be sent overseas, finalized, then sent back. (Then you have factors such as excess shipping containers that are overcrowding Asian and US ports, making organization more difficult, a decrease in truck drivers, the occasional container that falls off the ship in a storm, excess fuel costs slowing down distribution, etc. Some higher end chips are flown over on cargo planes, which has also increased costs due to fuel and pilot shortages.) Y’all want faster chip production? Find a way to move final chip production stateside!!! I left that industry after witnessing poor management and poor future planning.

America first time experiencing how it is when they make an advancement and don't capitalize on it, lol

Bloomberg is interviewing itself these days?😂😅

As a Taiwanese involved in semiconductor industry, 5:24 is a very misleading interpretation. Intel has a very different business model than TSMC. It’s a very consumer-facing company, doing both designing and manufacturing. Its profit ties heavily on its capability on launching new product to the market. TSMC only specializes in manufacturing and doesn’t launch any product. You can even say that TSMC’s chip design capability has fallen behind Intel for at least 50 years, in the sense that it doesn’t design its chip at all. Intel trades part of their chip manufacturing capability to chip design business. The differences in business model shouldn’t be interpreted as what the video intended it to be.

Intel didn't use EUV because they tried to advance past 14nm but got stuck big time, but were too proud to switch tack and either buy from TSMC, or adopt EUV because unlike smartphone ARM chips where smaller nodes mean big power savings and longer battery life, x86 desktop/server chips doesn't need to be that power efficient at higher cost and lower profits. And also because they were facing minimal competition from AMD so could afford to get stuck for years, that is until AMD fought back with Zen/Epyc. If Zen/Epyc didn't exist Intel might still be on 14nm.

We privatize profits and socialize costs in this country. It's not surprising that Government Sponsored Research results and support for technology gets sold out, the same way we offshore manufacturing. Another self inflicted injury.

TSMC first overtook intel in 2016 at the 10nm node, which wass done without EUV. TSMC's first 7nm in 2018 (similar to Intel's old 10nm) was also done without EUV. EUV wasn't the biggest reason intel fell behind, but why it stuck on 14nm without back up plan for so long still puzzles me to this day.

"One atom thin layers"...wow. Human tech is inching towards the physically possible?

USA did the same thing with Middle East oil in the 1970's. Shifted from a net exporter to net importer because foreign oil was "cheap". Then embargoes happened, wars happened and oil became a method for adversaries to attack the USA. Today we are the world's largest producer again but it took decades to fix that mistake.