TSMC is a king-maker


TSMC is a Taiwanese chip contract manufacturer that you probably have not heard about. However, it may be the brains behind your Apple or Samsung expensive smartphone’s chip. TSMC assembles chips for others and let them claim the glory while it fattens its bank account.

As I have always said, computer chips do not speak English; they speak a language of ones and zeros. To generate those zeros and ones, you need an electronic component that can switch on and off repeatedly; where the off states would represent zeros and the one state ones. That is what exactly a transistor does.

A good processor must be a workaholic; must have billions of transistors. To achieve this, chips or processors or indeed CPUs, as they are generally christened, must be able to squeeze a lot of transistors into tiny spaces. These spaces are so small that they are measured in nano meters.


If you have a laptop that was manufactured some 10 years ago, the chances are that its chip was manufactured using a 45 nanometer process. Now you know what that means or you are not listening. If you have a recent Apple laptop, the chances are that its processor was manufactured using 10 or 5 nanometer process.

Well, all you have to know is that the smaller the number, the more transistors that are packed in that chip and the better it is.

Recently, the erstwhile chip giant Intel has been struggling to migrate to the 10 nanometer process. The company has had to cancel several road-maps. Meanwhile, Apple has been riding high with 10 and even five nanometer process chips for laptops and smartphones.


It is no secret that Apple has been in many corroboration projects with TSMC. This is idiomatic; literally that means Apple has had to contract out some of its chip manufacturing to TSMC.

If you cannot beat them, join them, so goes the saying. Intel has announced that it would abandon its 10 and five nanometer chip projects and use TSMC equipment to achieve the same.

This will fasten the road-map for Intel which has stagnated for a long time now. This may also make the migration of Intel chips into smartphones faster. Intel has not made any impact on that market segment as it has been intoxicated with past glory in computer chip success.

What will this mean to chip dollar competition? Apple and Intel will seem to compete on the surface, yet it will be TSMC providing the fuel of success to both.

That will leave Samsung, Qualcomm and TSMC as the real competitors. While TSMC announced that it would infuse $10 billion into its capital in 2021, Samsung announced that it would invest in a $10 billion chip manufacturing plant in Texas, USA.

TSMC is like a contract speech writer who writes for a president those flowery and poetic verses and claims no recognition.

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