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TSMC adds Diplomacy to its Chip Strategy, but at What Cost?

TSMC adds Diplomacy to its Chip Strategy, but at What Cost?

By Bolaji Ojo

What’s at stake:

TSMC says it will add more fabs in the United States, deviating further from its Taiwan-centric manufacturing strategy. It caved to pressures from American president Donald Trump, accepting that its business is mired in the bog of geopolitics and nationalism. This shift in the company’s standard operating system will come at a price, the possible loss of some operational efficiencies, for example. Is TSMC willing to pay this price or is it just attempting to deflect criticisms from Donald Trump?

Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) was pandering to America’s cantankerous president. It was dissembling, too, despite – finally – making diplomatic moves to appease a powerful and unrelenting foe.

Everyone knew this, but most comments on TSMC’s March 3 announcement that it will more than double US capital expenditure were positive, applauding the foundry and touting the brilliance of a move hardly anyone had predicted or even thought reasonable weeks earlier.

The setting of the announcement itself should have raised red flags. At the White House, Donald Trump, accompanied by TSMC CEO CC Wei, said the Taiwan-based company would increase the number of semiconductor fabs it is building in the United States by 5, at a cost of $100 billion. This would bring the total of its latest capex investment in the country to $165 billion, Wei said. He then proceeded to thank Mr. Trump “again for his support.”

Read More »TSMC adds Diplomacy to its Chip Strategy, but at What Cost?
What’s Cooking at OYR (and at my house)

What’s Cooking at OYR (and at my house): A Growing Trust Deficit

By Mike Markowitz

Trust.

It is the Cornerstone of Business, Geopolitics, and Global Stability.

In commerce, geopolitics, and everyday life, trust is the invisible currency that underpins all relationships. It must be painstakingly built over years, sometimes decades, through consistent actions, adherence to commitments, and a mutual understanding of facts and the belief that agreements, policies, and expectations will not be arbitrarily upended. Yet, trust is uniquely fragile — it can be shattered in an instant by an act of bad faith, policy reversals, or unpredictability in governance. Today, we find ourselves in an era where that trust is being tested like never before.

The Value of Trust in Business

For senior executives in the electronics industry, trust is not just a philosophical concept; it is the bedrock of operations, investments, and supply chains. Companies rely on a stable regulatory environment, enforceable contracts, and predictable market conditions. Businesses make capital investments based on long-term projections of policies, taxation, and trade agreements. Without trust in these foundational elements, decision-making becomes fraught with uncertainty, increasing risk and reducing innovation.

Read More »What’s Cooking at OYR (and at my house): A Growing Trust Deficit

Embracing Artificial Intelligence: Electronics engineers explore abundant opportunities in design and development with AI

By Avnet Insights

Even though it lagged some of the technologies we have used for many years, it could be said that artificial intelligence (AI) went mainstream in 2022 with the launch of ChatGPT. This fourth Avnet Insights research report explores how far AI has penetrated both the electronic product design process and the functionality of end products.

Around eight out of 10 electronics engineers surveyed had products on the market today that feature AI (42%) or are working on incorporating AI into their product designs (40%). Respondents predicted the adoption of AI across a wide range of product applications, with process automation highlighted as a leading application opportunity for the technology. Regionally, China was seen to be leading with AI- enabled products already in the market (66%).

Perhaps surprisingly, there was not a dominant use of AI in the design process, but the technology does touch most stages of design and development from simulation to cross-technology integration. The use of AI in autonomous design and decision-making was ranked number one by a small margin of respondents, but responses were distributed across every stage of product development, with no one category garnering more than 9% of the responses.

In summary, AI is already pervasive both in the product design process and as a product feature. And many respondents believe we’re only seeing the tip of the iceberg.

Survey Methodology

This Avnet Insights survey was carried out online between Oct. 31 and Nov. 15, 2024, and it generated responses from 1,204 engineers across Asia (including Japan), EMEA, and the Americas. All major industry sectors were represented, with nearly half of respondents employed in Information Computing and Telecommunications (ICT).
Approximately two-thirds of respondents indicated they have primary responsibility for their company’s product design; a quarter reported shared responsibility. In other words, the survey respondents were highly influential. Their job roles include software engineers (41%); electronics, hardware and mechanical engineers (31%); and engineering management (27%).
Respondents were evenly spread between companies with revenues between $1 million and $10 million (15%) up to those with revenues between $501 million and $1 billion (18%). Approximately one-fifth of respondents work in businesses with revenues of more than $1 billion.

KEY FINDINGS

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In Intel’s Crisis, a Glimpse of TSMC’s Quandary

In Intel’s Crisis, a Glimpse of TSMC’s Quandary

By Bolaji Ojo

Under normal market conditions, the concept of Intel Corp. and Taiwan Semiconductor Manufacturing Co. Ltd., (TSMC) “eyeing potential deals that would break the American chip-making icon in two” as reportedly recently by the Wall Street Journal would be considered a non-starter. A separate report from the New York Times stating Intel is working with “the Trump administration on a plan to turn over the operation of its chip-making plants” to TSMC falls in the same category.

Intel got itself into this funk. We have emptied a dozen barrels of ink reporting and pontificating on how the company got into this mess and what it must do to get out. (See: Intel Needs an Active, Competent Board, not a ‘Savior’ CEO; Intel: It’s Time for the Unthinkable; Intel-Samsung Foundry Union is a Non-Starter; Intel’s Last Hope: Private Equity LBO?; Intel Board, After Review, Insists on Token Changes; Out of Intel, America’s Dream Foundry: Here’s How; Intel’s Crisis Was Predictable. Its Future Isn’t a Mystery, Either; Intel Says it’s Building ‘Two World-Class Companies.’ Meaning, please?.)

For now, the industry can only await Intel’s next move. While we do this, however, there is another problem the industry must stay aware of, and that is the predicament laid upon TSMC – as it expands operations globally and the elevated, unprecedented and unfair expectations and demands that the entire semiconductor industry, OEMs and several national governments have placed on the Taiwanese company.

Read More »In Intel’s Crisis, a Glimpse of TSMC’s Quandary

What’s Cooking at OYR (and at my house)

By Mike Markowitz

Some great content to highlight on the site this week:

  • With all of the discussion about AI, Bolaji sat down with industry veteran and CEO of Veriest Moshe Zalcberg to understand whether AI can help design and verify the next generation of even more powerful AI chips. The webcast, Chips for AI and AI for Chips, asks and answers the question of whether AI chips are harder to design and how AI can help.
  • Bolaji also looks closely at STMicroelectronics, after their disappointing 2024 in Whither STMicroelectronics after Annus Horribilis? He asks the tough questions: Is ST’s $20 billion revenue goal, which it had targeted by 2027 after hitting record sales of $17.3 billion in 2023, still achievable? What will happen to manufacturing plans, capex, R&D, and the workforce as the company struggles to climb back uphill?
  • In spite of those poor results, Peter Clarke sees a recent 15-year agreement between ST and TotalEnergies as confirmation of ST’s commitment to sustainability and achieving carbon neutrality by 2027. In ST and the Persistence of a Green Legacy, Peter details ST’s journey and credits ST for embedding sustainability into its long-term strategy.
  • High-performance power modules manufacturer Vicor is making a bold leap to apply its expertise into 48V power systems for EVs. In Vicor Puts Pedal to Metal for 48V EV Power Systems, Bolaji talks to Chief Marketing Officer David Krakauer to understand Vicor’s approach and how automakers’ transition to 48V is going,
  • We’ve finished posting Lee Goldberg’s series looking at the heritage of the US Space program. Part 1, Mercury and SpaceShipOne: 40-years of Technical Evolution looked at how two different, but important steps in the evolution of the space program were propelled by competitive challenges. In Part 2, Mercury and SpaceShipOne: The Spacecraft, he shared how two very different spacecraft still shared similar design requirements. Part 3, Mercury and SpaceShipOne: Very Different Launch Systems, looks at how the launch systems evolved over 40 years and highlights some of the “piloting badassery” that saved multiple missions (not to mention the pilots).

Now, I’m hungry. Here’s What’s Cooking at my house!

Read More »What’s Cooking at OYR (and at my house)

Mercury and SpaceShipOne: Very Different Launch Systems

By Lee Goldberg

What’s at Stake:

NASA investigated multiple launch systems to put a man into Space and ultimately decided to put the Mercury capsule atop derivatives of ballistic missiles. 40 years later, economics and technology evolution allowed the engineers and scientists working on SpaceShipOne, to make a different decision.

The first two crewed Mercury flights were carried on their suborbital trajectories by human-rated derivatives of the Redstone ballistic missile. These rockets were highly-evolved versions of the V2 ballistic weapons originally developed by Wernher von Braun that Germany used to bombard Britain during WWII.

Among the direct similarities between the two rockets was the use of a 75 percent alcohol/25 percent water fuel mixture and liquid oxygen (LOX) as its oxidizer, and a steering mechanism which used a set of carbon vanes placed just below the rocket exhaust. Although the Redstone’s Rocketdyne A-7 motor, and the turbopumps, that fed it were significant improvements on those used by the original V2, their basic concepts and functions were remarkably similar.

To achieve the velocities needed for orbital flights, subsequent missions were flown aboard an Atlas-D rocket, originally created to serve as an intercontinental ballistic delivery vehicle for nuclear weapons. Powered by a pair of Rocketdyne XLR-85 engines burning kerosene and liquid oxygen that produced up to 360,000 pounds of thrust, and an LR-101 sustainer engine, the Atlas used super-thin fuel tanks and other lightweight construction techniques to maximize its payload capacity.

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Vicor Puts Pedal to Metal for 48V EV Power Systems

Vicor Puts Pedal to Metal for 48V EV Power Systems

By Bolaji Ojo

What’s at stake:

Vicor has been in the power electronics market long enough to know when a new and potentially large market opportunity has emerged. This year, the company is going all out with plans to explore opportunities in the auto industry as it finally embarks on the planned rollout of its 48V power systems for electric vehicles. It’s a new area for the company, but it is leveraging 48V technology and expertise it has in-house and which it has offered in other hard and tough environments where reliability and durability are standard requirements. We talk with CMO David Krakauer about Vicor’s roots in power, its 48V offerings for EVs and how it plans to win over auto OEMs and tier-ones.

Vicor Corp. first made the announcement of its entrance into the automotive power market late last year, rolling out already certified 48V EV products and recognizing with the move a distinct change occurring in the electrification of electric vehicles.

The three products, which Vicor said it planned to roll out in 2025 to “support automotive OEM and tier one production” mark the company’s attempt to match some of its existing products and technologies with the growing demand for a different level of electrification systems for EVs.

In a press release, Patrick Walden, head of the company’s automotive business, noted that the new BCM6135, DCM3735 and PRM3735 which Vicor announced in October had already completed “the production part approval process with automotive customers.” What remains was for Vicor – starting in 2025 – to show it can be as critical a supply chain player in the power automotive industry as it is in aerospace, computing, defense, and industrial equipment.

It is now 2025 and Vicor is on a roll as promised. We caught up with David Krakauer, head of marketing and channel strategy, at Electronica in Munich late last year as the company was getting its 48V power systems ready for market. Krakauer promised the plan was all set for 2025. He also provided some insight into Vicor’s history and explained how the company was leveraging its strength in other markets as it powered into the automotive segment. Click the video link below to watch the interview.

Read More »Vicor Puts Pedal to Metal for 48V EV Power Systems