Digitimes Founder Urges Taiwanese Chipmakers to Compete Globally

Colley Hwang, the founder of Digitimes, has called on Taiwanese semiconductor companies to assertively compete on the global stage over the next 5-10 years, comparing the required approach to that of Genghis Khan. Hwang believes this intense competition is necessary for Taiwan's chipmakers to maintain their competitive edge beyond 2030, even as concerns arise over industry leader TSMC's overseas expansion.

In recent years, TSMC has been investing in chip manufacturing facilities in countries like Germany, Japan, and the United States. However, this overseas production comes at a higher cost compared to its operations in Taiwan. TSMC has indicated it will increase the price of chips made outside Taiwan to address pressures on profitability, as startup and material costs are significantly more expensive in these new locations. This move also comes as TSMC anticipates a slump in the domestic market.

Despite these challenges, Hwang sees TSMC's global expansion as a great opportunity for Taiwan. He argues that Taiwan's dominance in the semiconductor industry is built on its technological edge, broad customer base, and robust industrial ecosystem. With TSMC's existing capacity in Taiwan alone reaching about 1 million wafers per month, Hwang believes Taiwan is not at risk of being overtaken in the near future.

Hwang views the expansion abroad as a means for Taiwan to leverage global talent, which is crucial given the country's low birth rate and shrinking pool of engineers. By utilizing the abundant land and water resources provided by other countries, as exemplified by TSMC's subsidiary in Kumamoto, Japan, Hwang suggests that Taiwan can overcome its physical resource limitations.

Why this matters: The global semiconductor industry is undergoing significant shifts, with major players like TSMC expanding their production beyond their home countries. As competition intensifies, the strategies and decisions made by Taiwanese chipmakers in the coming years will have far-reaching implications for the industry's landscape and Taiwan's continued dominance in the field.

Hwang's call for Taiwanese semiconductor companies to compete fiercely on the global stage underscores the high stakes involved in maintaining Taiwan's competitive edge. As he noted, "Taiwan's semiconductor dominance is due to its technological edge, broad customer base, and strong industrial ecosystem." The coming years will be critical for Taiwan's chipmakers to navigate the challenges and opportunities presented by the evolving global semiconductor market, especially with the AI boom.

Key Takeaways

• Digitimes founder calls for Taiwanese chipmakers to aggressively compete globally.
• TSMC's overseas expansion comes at higher costs, leading to price hikes.
• TSMC's global expansion seen as an opportunity to leverage global talent.
• Taiwan's semiconductor dominance built on tech edge, customer base, and ecosystem.
• Upcoming years critical for Taiwan's chipmakers to navigate global market shifts.