Securing Technology for America - TSMC and Taiwan: "Tool Shed" For the Coming 4th Industrial Revolution - 5NM Fab Worth $12 Billion In 2029 - Value Chain - US-China Chips Decoupling - Coronavirus: Initiation Ceremony

Ed.'s note: It's not about "making good business sense" to build a TSMC fab in Arizona. It's about securing this technology from China and understanding that TSMC in Taiwan is the "tool shed" for the coming 4th industrial revolution. This news was followed up by the US now making the decision to expel Chinese graduate students with ties to China's military schools. Is it now time to include British and Israeli graduate students with ties to UK/Israeli military schools? This means escalation as China's Xi Jinping announces to China's military to "prepare for worst case scenarios." China covets this technology and without out it the Chinese will not be able to sustain their tech growth considering they are roughy ten years behind in microprocessor manufacturing design. This is good news but a lot more has to be done to bring technology back to America then secure it. This all depends on the US military around President Trump. This critical technology especially microprocessor manufacturing should be under the control of the US military and not private equity firms directing where investments in technology are made. The coming 4th industrial revolution will be like nothing humanity has seen and the globally-induced coronascam was our initiation ceremony.

News update for 28 May 2020: A US destroyer challenged China's vast South China Sea claims as tensions rise in the strategic waterway

Transcontinental Oligarch Financial Elite - China Covets Taiwan (TSMC) - Investment Nexus: Blackstone, China (Tsinghua University) and Israel - Control A.I. and Control the Future Until 2100 - Private Equity Investments Under Scrutiny - Rhodes Scholars to Be Replaced

Showdown In the South China Sea Approaching - Collapse of Supply Chains - Shortages Are Coming - "Malacca Paradox" - War and Coronavirus - TSMC Caught In Cross Fire Between US and China

Bring the Technology Back to America - Reopen America - TSMC and Intel In Talks - Secure the Supply Chains

Are TSMC and Huawei Deals Different Sides of the Same Coin? 
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Source: technode

TSMC prepares for US-China chips decoupling

What is TSMC doing in Arizona?

by Jan-Peter Kleinhans | May 27, 2020

On May 15, the world's largest contract chipmaker announced plans to open a production plant, or "fab," in Arizona, US. If you know the industry, it doesn't seem to make business sense: the Taiwan Semiconductor Manufacturing Company (TSMC) will build a 5nm fab in Phoenix, Arizona and start churning out chips by 2024, with a target of processing 20,000 wafers per month. The chipmaker plans to invest $12 billion through 2029.

First, the Arizona fab will be small, and not at all leading-edge by TSMC's standards. A 5nm fab will be mid-range, at best, in 2024. Right now, TSMC itself already produces Apple's A14 processor on 5nm nodes for the upcoming iPhone 12. Qualcomm, AMD, and Nvidia are working closely with TSMC to ensure high volume production of their 5nm chips by 2021. If TSMC sticks to its plan, the company will start high volume production of 3nm chips in 2022. Also, 20,000 wafers per month is a tiny amount—" like dipping your toes in the water"—compared to the 2.5 million wafers per month TSMC currently processes.

Second, it will be expensive. In a recent investors' call, TSMC itself said that between a fab in the US and one in Taiwan, "there is a cost gap, which is hard to accept at this point." In a nutshell, the world's largest contract chipmaker just announced that they will open a small, mid-level fab in the US for $12 billion. Why would they do that?

Because TSMC, maybe better than anybody else, knows that the semiconductor value chain is the football in the US-China competition over tech. And the contract chipmaker is right in the middle of this.

This value chain is highly efficient, but not at all resilient.

Even though their planned Arizona fab may not make a lot of sense economically speaking, it is an understandable long-term business decision to stay in the US government's good graces. Especially since both the US Department of Commerce and the US Department of Defense have pushed TSMC for quite some time to open a fab in the United States.

Value chain chokepoints

If the US government perceives a foreign ICT (information and communication technology) vendor as a threat to their national or economic security, they will go to great lengths to curtail this vendor's technological advances. Huawei is learning this lesson the hard way. The Chinese telecoms giant is the target of several export control measures by the US government.

Even though export controls are rather crude and antiquated policy tools, they are still effective if the market is highly concentrated. This is the case for the semiconductor value chain, and that is why the US government will most likely continue to utilize export control measures to cut Chinese companies off.

Please go to technode to read the entire article.
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Will it be worth a shooting war in the South China Sea?

Military Confrontation in the South China Sea - Preparations Underway - China's Dual-Carrier Drills - US Naval Assets Move Into the South China Sea - Simulated Conflict - Hong Kong Falls To Beijing