Elon Musk on Saturday announced that his rocket making company SpaceX and electric vehicle major Tesla will jointly run a new chip manufacturing facility in Austin, Texas, AFP reported.
The chips will be for use in artificial intelligence projects, robotics and data centres for space, with aim to produce 1 terawatt of computing power per year, it added, citing Musk. (1 terawatt = ¬1 trillion watts).
Why is Elon Musk starting his own chip manufacturing facility?
The world’s richest man said the so-called “Terafab” was necessary because Tesla and SpaceX’s demand for computing power is expected to far exceed that of global chip suppliers. While he did not disclose how much initial investment is being made, reports pegged the initial infusion between $20-25 billion, it added.
“We’re very grateful to our existing supply chain, to Samsung, TSMC, Micron, and others… but there’s a maximum rate at which they’re comfortable expanding. That rate is much less than we would like… and we need the chips, so we’re going to build the Terafab. The advanced technology fab in Austin will have the facilities to design, manufacture, test and improve each chip,” Musk said.
Other articles have made clear the the initial pilot line will be in Austin on Tesla’s Gigafab land, but that the eventual full-scale production fab may be located somewhere else.
The project aims to make chips to support 100 to 200 GW of computing power on Earth, and 1 TW in space.
Musk did not share a timeline for the production or output. The AFP report noted that the billionaire has many times in the past announced timelines that his companies failed to meet, i.e. robotaxis, SDF, etc.
According to Musk, the Terafab would ultimately help humanity become a “galactic civilization” capable of harnessing the resources of other planets and stars.
A Bloomberg report added that Musk has said previously that the facility would produce 2 nanometer chips.
It added that the Austin facility is expected to make two types of chips, one of which will be optimized for edge and inference, primarily for his vehicle, robotaxi and Optimus humanoid robots.
The other will be a high-power chip, designed for space that could be used by SpaceX and xAI. Musk said he expects xAI to use the vast majority of the chips, it added.
Musk also unveiled a speculative rendering of a future “mini” AI data center satellite with 100 kW power. This is part of a larger installation he wants SpaceX to build to do complex computing in space.
In January, SpaceX requested a license from the Federal Communications Commission (FCC) to launch one million data center satellites into orbit around Earth. “We expect future satellites to probably go to the megawatt range,” Musk added.
Let’s skip over addressing the feasibility (or desirability) of the space half of this grand vision. Never mind that Musk has evidently been freebasing back issues of The L5 News and G. Harry Stine’s Analog columns circa 1979 to conceive his solar-powered orbital cathedrals of vast, cool machine intellects.
No, I want to focus on the task of getting a purely ground-based, cutting edge, 2nm semiconductor fab up and running. There’s nothing impossible about that part, and $25 billion is right around the current price to build a state-of-the-art fab. Other reports say:
Production targets are specific. The facility is designed to produce between 100 and 200 billion custom AI and memory chips per year, targeting an initial output of 100,000 wafer starts per month with a stated ambition to scale toward one million — roughly 70% of TSMC’s current total output, in a single US facility.
Tesla is targeting 2 nanometre process technology, the most advanced node currently in commercial production. Tesla’s fifth-generation AI chip, AI5, is among the first products Terafab is designed to produce, with small-batch production expected in 2026 and volume production projected for 2027.
And here’s where my deep skepticism kicks in, over both the output and timeline.
Having more cutting-edge fabs here in the continental United States is a great idea, and there’s nothing wrong with vertical integration for companies to combine design, fabrication and test under one roof. Indeed, Musk has merely reinvented Integrated Device Manufacturing, which used to be the norm until the foundry model took hold, and that’s still the norm with companies like Intel (though not necessarily all under one roof). And Intel, Samsung and TSMC already have their own mask manufacturing facilities in-house. So based on the little information available now, Musk’s radical new approach isn’t.
But that timeline of initial production in 2026 and volume production in 2027? Unless Musk has already placed orders for the critical semiconductor manufacturing equipment (especially however many ASML TWINSCAN EXE:5000 or TWINSCAN EXE:5200B EUV lithography systems the fab will need) long before now, that’s simply not happening. The lead time for the most critical machines are a year or more. And that’s just one machine.
There are five essential semiconductor equipment manufacturers:
Applied Materials
ASML
KLA
LAM Research
Tokyo Electron
If you’re building a modern, 2nm fab, chances are pretty good you need all five. You need the ASML litho machines mentioned above. You need KLA inspection tools to raise and maintain yields, and you need, at the very least, one of AMAT, LAM or TEL to provide the rest. Take away all three and you can’t equip a fab, period.
And that’s after you’ve poured the agonizingly precise, ridiculously level concrete slab for the equipment to rest on, installed huge networks of high voltage power systems (ASML machine alone now run at 1,000 watts), ultra-high purity air handling equipment and ultra-high purity de-ionized water handling systems. All that needs to be installed, up and running before you even start installing the tools. And then all the tools need to be brought up and qualified for production. And that all needs to be done before tape-out, mask production and the first wafer is run.
But the timeline isn’t the only thing that’s delusional about Musk’s announcement.
Terafab is designed for an initial output of 100,000 wafer starts per month, with ambitions to scale to 1 million wafer starts per month at full capacity. For context, that full-scale target would represent roughly 70% of TSMC’s entire current global output — from a single facility operated by companies that have never fabricated a chip.
Musk said the facility would produce between 100 and 200 billion custom AI and memory chips per year, powering Tesla’s “Full Self-Driving” software, the Cybercab robotaxi program, and the Optimus humanoid robot line. He also said millions of Optimus robots would help build and operate the facility.
Put aside the swarms of robots for now. A lot of what can be automated for a fab already has been with automated FOUP-handling equipment. What hasn’t been automated is routine maintenance, troubleshooting, etc. I’m guessing it will be quite a while before Frankie Fabbot is ready to take on any of those tasks.
100,000 wafer starts a month is around what TSMC’s cutting edge fabs produce a month. Samsung has a huge fab supposedly capable of 450,000 wafer starts a month. A million starts a month in one extremely big fab is possible, but it’s going to take multiple lines, lots of money, and throughput will still be gated by the lowest capacity machines on the line (again, I’m guessing the ASML litho machine). Modern fabs have already maxed out production speeds for modern high-yield plants. You can’t simple pull a lever to make the line go faster.
Then there are his plans to build memory chips and space-hardened versions of the xAI chips in the same megafab. Neither of those goals is impossible, but it’s going to require more equipment than his $25 billion estimate to essentially run three production lines in the same building. And preparing chips to operate in space generally involves completely different “rad-hard” processes, involving different types of wafer chemistry, that are nowhere near the 2nm process node.
Musk is a smart guy. I bet he can eek a few performance gains out of how his fabs are organized, AI line optimization, etc. But unless he’s smarter than Einstein, Thomas Edison, Tony Stark and Reed Richards combined, I’m hard-pressed to see how he can optimize more than, say, 15% over existing cutting edge fabs.
Nothing Musk has proposed for the earth-bound side of Terafab is impossible, but it is all-but-impossible to implement in the time-frames he’s alleging, for the money he’s claiming. One million wafer starts a month in a single fab? Doable, but not by 2027, and not for $25 billion. Having such a fab up and running full tilt in 2029-2030, for $100 billion, seems at least at the edge of feasibility. Whether the AI boom will still be a “thing” by then is unknown, but a fab actually capable of one million wafer starts a month (robots or no robots) is still a license to print money…
Jobs are down, more Minnesota fraud uncovered, a bunch of military action outside the Persian Gulf, an Austin jihad shooter, Noem gets the Old Yeller treatment, Bill Clinton remains Bill Clinton, and Microsoft, amazingly, manages to get even worse.
It’s the Friday LinkSwarm!
Also consider this your “Iran Strikes: Day 7” update with a smattering of news as well. There are reports that Kurdish forces have entered Iran from Iraq, but I’m not seeing sufficient evidence for that yet.
Interesting chart showing Iran has likely “blown its wad” on missiles and drones, as day by day fewer and fewer are being launched.
Update Numbers as of Mar. 6, 12.00 AM The numbers are rounded and compiled from various media reports, with a margin of error of ±10% 15% **Corrected previous Post there was a Mistake https://t.co/eDlVfc3nzApic.twitter.com/UiHAU0yNHe
The Supreme Court upheld the standard for reviewing asylum cases, keeping it in the hands of immigration agencies.
Yes, even the leftist justices agreed. 9-0.
“We granted certiorari to determine whether the Court of Appeals applied the appropriate standard of review under the INA [Immigration and Nationality Act],” wrote Justice Ketanji Brown-Jackson. “We conclude that the statute requires application of the substantial evidence standard to the agency’s conclusion that a given set of undisputed facts does not constitute persecution.”
Top officials in Minnesota were made aware of fraud concerns surrounding government assistance programs as early as 2019 but failed to take action as billions of dollars were stolen and warnings piled up.
Former Minnesota state officials testified to the House Oversight Committee that Governor Tim Walz and Attorney General Keith Ellison were first informed that the state’s social services programs had been compromised by widespread fraud in 2019 and 2020, according to a new report from the committee.
“Testimony obtained by the Committee reveals that Governor Tim Walz and Attorney General Keith Ellison were aware of widespread fraud in social service programs, lied about their knowledge of the fraud, and retaliated against employees who dared to raise concerns. Instead of protecting vulnerable Americans, they handed over billions in taxpayer dollars to fraudsters and threw their own state employees under the bus,” said House Oversight Committee chairman James Comer (R., Ky.).
Several different entities and state-level programs are implicated in Minnesota’s fraud scandal. The most prominent program is Feeding Our Future, which fraudsters targeted during the Covid era to steal $300 million from the Minnesota Department of Education that had been designated to provide food to poor children. Feeding Our Future is now dissolved and dozens of defendants have been convicted in connection with the scheme since 2022.
According to the committee report, Minnesota Department of Education officials first received allegations of fraud against Feeding Our Future from the U.S. Department of Agriculture in 2019. The USDA alleged Feeding Our Future was created with forged signatures and misled sponsored food distribution sites about certain federal requirements. Minnesota officials dismissed the allegations at the time. By April 2020, Walz and Ellison’s offices were briefed about the Minnesota Department of Education’s concerns regarding Feeding Our Future, Assistant Commissioner Daron Korte testified to the committee. State officials contacted the USDA about Feeding Our Future in late 2020, but the agency’s inspector general did not act, a failure that emboldened the scammers at Feeding Our Future.
The Oversight Committee report asserts that Minnesota officials could have suspended payments to Feeding Our Future but chose not to because of potential litigation and racism accusations. Minnesota officials blamed the USDA and Feeding Our Future for perpetuating the large-scale fraud. In March 2021, the Minnesota Department of Education stopped payments to Feeding Our Future, but resumed payments voluntarily the following month after a court hearing on the matter. A court order was never issued requiring the payments, contradicting Walz’s 2022 assertion to the contrary. The lack of a court order was confirmed during the course of the Oversight Committee’s investigation.
In early 2019, Walz’s administration became aware of fraud tied to two programs administered by Minnesota’s Department of Human Services, former agency commissioner Tony Lourey testified. Another former commissioner, Jodi Harpstead, testified that Walz’s administration believed fraud connected to a child care program run out of the Department of Human Services had already been resolved. But the Oversight Committee report references two auditor reports showing otherwise, both of which were issued in 2019. The Department of Human Services lacked fraud mitigation mechanisms and felt pressure to get money out the door to justify state appropriations, the committee found. Despite credible allegations of fraud, the agency failed to act on the warnings and unilaterally stop making payments to the social services programs in question.
The Oversight Committee’s report is based on testimony from nine top current and former state officials, documents and communications, and briefings with federal and state officials. The Minnesota U.S. Attorney’s office recently speculated that the interwoven fraud schemes totaled nearly $9 billion in misallocated funds. Of the fraud defendants, 85 percent of them come from Minnesota’s Somali-American immigrant community. Social services programs that provide food, child care, housing, and special education have all come under scrutiny as federal investigators unravel the fraud scheme.
I know it’s been easy to overlook in all the other military news this week, but Afghanistan and Pakistan have been going at it as well, though only at a border skirmish level rather than a full-scale conflict. Since the Pakistani ISI helped create the Taliban, this is what’s known as “blowback.”
Rene Campos, a registered sex offender, is seeking elected office in California – launching a campaign for Fresno City Council amid fierce backlash and renewed questions about whether someone with his record should hold public office.
Campos was arrested in 2018 following a cyber tip to the Central California Internet Crimes Against Children Task Force. He was found in possession of child sex abuse material, according to court records. In 2021 he entered a no-contest plea to a single misdemeanor charge of possessing and controlling child pornography/child sex abuse material (likely under California Penal Code § 311.11). He served only one month in prison and a two year probation period.
Campos describes himself as a gay man who is running for office on the platform of “reduced crime and rehabilitation.”
Possession of child pornography is typically treated as a felony, even in a woke haven like California. How the Fresno candidate was able to make a deal for a misdemeanor charge and spend only one month in prison is a mystery, but this does help to confirm ongoing suspicions that California’s legal system is falling into steep decline.
California is notoriously soft on child sex abusers. Recently, a Sacramento parole board released Daniel Allen Funston, who was convicted in 1999 of sixteen counts of kidnapping and child molestation after a horrific crime spree in Sacramento County, during which he kidnapped, raped, and beat eight children ages 3 to 7.
Funston was originally sentenced to three consecutive life terms plus 20 years, but was set free at age 64 due to a California elderly inmate program (maybe he’ll run for office, too).
Data from 2022 shows that the Golden State released over 7000 child sex offenders after less than one year of incarceration. Interestingly, “digital blocks” were added to the Megan’s Law website that prevent more recent analysis.
Virginia Governor Abigail Spanberger is demanding that Immigration and Customs Enforcement provide warrants before violent illegal criminals are turned over to federal authorities, following the stabbing of a Virginia woman by an illegal immigrant with a long and violent criminal history.
Abdul Jalloh was charged with second-degree murder after Stephanie Minter was brutally stabbed in the neck at a Virginia bus stop. Jalloh had previously been charged more than 40 times, including for egregious crimes such as aggravated assault, malicious wounding, and rape. Prosecutors dropped 20 of the 43 charges against Jalloh. The Fairfax County Commonwealth’s Attorney’s office said the charges were dropped because Jalloh often chose victims who did not have permanent addresses, making the proceedings more difficult.
The Department of Homeland Security said Jalloh is an illegal immigrant from Sierra Leone. He entered the United States in 2012.
“ICE previously lodged a detainer against Jalloh in 2020, and he was granted a final order of removal by a judge who found he could be removed to any country other than Sierra Leone,” DHS said in a statement. “This case illustrated the importance of third country removals to get criminal illegal aliens out of the U.S.”
Spanberger insists that in order for Virginia to work with federal authorities, ICE must provide a signed judicial warrant, regardless of the alien’s criminal history. DHS requested cooperation with Virginia and Spanberger to deport Jalloh following his alleged involvement in the fatal stabbing.
“We are calling on Virginia Governor Abigail Spanberger and Virginia’s sanctuary politicians to commit to not releasing this murderer and violent career criminal from their jail without notifying ICE,” Deputy Assistant Secretary Lauren Bis said in a statement. “This illegal alien’s murder of an innocent, beautiful American woman came less than 24 hours before Governor Spanberger’s demonization of ICE law enforcement. This heinous criminal is a perfect example of why we need cooperation from sanctuary jurisdictions and the importance of third country removals for the safety of the American people.”
What the Trump administration has done on the DEI front represents the beginning of a general reorientation of our politics away from wokeness. One need only survey what prominent leaders of the Left are saying about the political price the Democratic Party has paid on that score. What they are saying indicates a large political change, even if the Dems prove incapable of unmooring themselves from woke politics for the near future.
The first sign of this reorientation is a general shift in the popular mindset: the spell of woke politics has broken. This matters because it was always the way in which woke politics commanded assent in the citizens’ hearts and minds that was crucial. That assent has been questioned or denied now in a broad way, with the backing of public authority (Supreme Court decisions, executive orders, agency directives), and with widespread public support. Wokeness’s public hectoring, punitiveness, and censoriousness, and the extremism of many of its positions on the issues, is unpopular at the level of 70–30 or 80–20 opinion poll divides.
We ought to be confident, therefore, that the broken spell of wokeness augurs a permanent shift in our public life. What that means precisely, however, depends very much on how we understand wokeness and what is done going forward to ensure that woke excess does not return. Now, if, as many say, wokeness was the product of cultural Marxism (Christopher Rufo and a host of followers) or postmodernism (Jordan Peterson and another host of followers), then all that needs to be done is to combat bad ideas. On these interpretations, our universities in particular, and other cultural institutions where the influence of such ideas holds sway, need our attention. Certainly, cultural Marxism and postmodernism represent bad ideas, and the world would be a better place without their influence.
But if what wokeness represents above all is the explosive power of the civil rights revolution and the influence of an aggressive leftist interpretation of anti-discrimination politics, as another band of interpreters claims (I among them), then the task ahead is much bigger and much more difficult.
Trump’s anti-DEI measures, on this view, would represent only the first step in a broader campaign of civil rights reform. One could look long and hard without seeing much in the way of evidence for any such thing so far. Are these current efforts against DEI an illusion, a brief moment of political opportunism that will recede as public hatred of wokeness recedes—only to return in a few years when the next wave of anti-discriminatory passion rises up?
I don’t think that worry is justified. The anti-DEI campaign to date will have enduring consequences because even if it is not yet clear that what is at stake in DEI is civil rights politics, the current reorientation can only have the effect of raising our awareness of the role of anti-discrimination in our public life. This has begun on the all-important moral plane of civil rights politics. Precisely by breaking the spell of its puritanical commands, our anti-woke moment is reworking something essential to civil rights politics. Because public morality is the crucial filter of the human mind, a shift at this level will change what we see, what we think, and what we think we can say. Anti-woke sentiment, backed by changes in the law, is providing a moment of political, cultural, and mental freedom that will necessarily lead, after many decades during which this was not possible, to a general reappraisal of the moral power and the meaning of the civil rights revolution.
Sources have identified the alleged gunman as 53-year-old Ndiaga Diagne to Nexstar’s KXAN and The Associated Press…
Diagne is originally from Senegal, according to multiple people briefed on the investigation. One of the people told the AP that Diagne came to the U.S. in 2006 and was a naturalized U.S. citizen…
Austin mass killer captured on video wearing ‘Property of Allah’ hoodie during rampage.
“Dallas Democrats Decide To Let DA Creuzot Go. With no Republican in the race, Democrat primary winner Amber Givens will become Dallas County’s next district attorney.” Creuzot was yet another Soros-backed DA, so maybe Dallas Democrats are ever so slowly moving back to sanity.
I’m just going to embed this Asmongold clip of Bill Clinton’s Jeffrey Epstein deposition without comment.
President Trump announced Thursday that Senator Markwayne Mullin (R., Okla.) will replace Kristi Noem as Homeland Security Secretary.
The announcement comes after Noem struggled to stand up to a public grilling by members of the Senate Judiciary Committee who pressed the former South Dakota governor on Tuesday about a $220 million ad campaign contract that was subcontracted to one of her longtime allies. Trump was furious at Noem for insisting during the hearing that he had personally approved the contract and began floating Mullin’s name as a potential replacement, National Review first reported early Thursday.
Mullin will replace Noem effective March 31. It’s unclear whether Trump plans to nominate Mullin to serve in the position permanently or whether he will serve in an acting capacity, sparing him the necessity of Senate confirmation.
“I am pleased to announce that the Highly Respected United States Senator from the Great State of Oklahoma, Markwayne Mullin, will become the United States Secretary of Homeland Security (DHS), effective March 31, 2026,” Trump wrote on Truth Social. “The current Secretary, Kristi Noem, who has served us well, and has had numerous and spectacular results (especially on the Border!), will be moving to be Special Envoy for The Shield of the Americas, our new Security Initiative in the Western Hemisphere we are announcing on Saturday in Doral, Florida. I thank Kristi for her service at ‘Homeland.’”
Already under significant scrutiny due to bipartisan criticism of her handling of Trump’s deportation agenda, Noem ran into further trouble this week during a series of hearings in which multiple lawmakers, most notably Republican Senator John Kennedy of Louisiana, asked her to explain why the agency had awarded a $220 million contract to a firm that was founded just days before, without ever opening up the bid to a competitive process. Kennedy also pointed out that part of that ad campaign was subcontracted to a strategy firm owned by Ben Yoho, the husband of former DHS spokeswoman Tricia McLaughlin.
A $220 million no-bid ad contract isn’t just wasteful, it’s actively criminal.
More defeats for the gambling lobby: “Two House Chairs Defeated by Challengers. State Reps. Cecil Bell and Stan Kitzman were ousted by Kristen Plaisance and Dennis Geesaman respectively.”
Plaisance ran on a platform of fiscal responsibility, securing Texas’ elections, and defending state sovereignty.
Bell’s campaign and allied groups—including the Las Vegas Sands–backed casino lobby and Texans for Lawsuit Reform—reportedly spent more than $1 million attempting to defend the incumbent.
Bell, who chairs the Intergovernmental Affairs Committee, had been censured by the Montgomery County Republican Party last year.
Incumbent State Rep. Stan Kitzman of Brookshire has been defeated by Dennis “Goose” Geesaman for the GOP nomination for House District 85. Kitzman served as chair of one of the House’s subcommittees on appropriations.
Geesaman, a pilot and Air Force Academy graduate, retired as a Lt. Colonel. He served five terms on the Flatonia City Council and later served as mayor.
While Texans for Lawsuit Reform and casino-funded PACs backed Kitzman’s reelection campaign, Geesaman ran on a platform of ending magnets for illegal immigration, DOGE-ing Texas, and supporting parental rights.
Kitzman also recently came under investigation for his paid work for a local governmental entity while serving in the Legislature.
Kitzman also voted to impeach Paxton, so I think we’re well rid of both of them.
The war against tranny madness continues. “Paxton Opinion Targets Therapists Behind Child ‘Psychological Transitioning.’ Psychiatric providers who help facilitate prohibited treatments may be barred from receiving public funds and could risk losing their licenses.”
Samsung Electronics America Inc. is one of five companies that have been accused by Attorney General Ken Paxton of collecting and monetizing consumers’ viewing data on smart TVs.
Following the agreement, Samsung will now make changes to not only halt the collection of viewing data without consent, but also update their TVs to include disclosures and consent screens.
Heard from some state agency people that this was coming: “Texas Dismantles DEI-Oriented HUB Network. The comptroller’s office has ended race- and sex-based preferences in state contracting.” Good.
“Former Warren Campaign Worker Says the U.S. Must Be ‘Abolished’ to Atone for Death of Ayatollah Khamenei…Calla Walsh, the communist activist who campaigned for Elizabeth Warren, Ed Markey, Bernie Sanders, and others, said the only way to exact “justice” is the complete deconstruction of the U.S. and Israel.” What percentage of the ideological core of the Democrat Party are actively communist?
One thing that reportedly helped kill Netflix’s acquisition of Warner Brothers: GOP congressmen visiting Netflix headquarters and discovering tampons in the men’s room.
Microsoft seems to be going from bad to worse: “Microsoft Copilot to hijack your browser… for your own convenience, embeds Edge into AI assistant, ignores questions about opt-in.”
Microsoft is rolling out a Copilot update to Windows Insiders that embeds web browsing directly into the assistant, opening links in a side panel rather than launching your default browser.
The plan is that users of the Copilot app in Windows will show content in the assistant’s window “so you don’t lose context.”
Copilot will also (with permission) have access to the context of tabs opened in that conversation, so the assistant can look across them when responding to user prompts. Opened tabs will be saved with the conversation so that they can be returned to, and, if a user chooses to enable it, passwords and form data can be synchronized.
Enabling password and form data synchronization might give some users pause for thought, particularly after the Windows Recall fiasco, but users worried about Redmond slurping data should probably consider an alternative to Windows anyway.
At first glance, it looks like embedding Edge into Copilot via the WebView2 control is an attempt to steer the user away from their default browser. Convenient, yes. Good for competition, possibly not. We asked Microsoft whether this would be an opt-in experience and which browser was being used, but, other than acknowledging receipt of our questions, the company did not respond.
It looks like this is going to be limited to corporate users for now, but launching web links without user control strikes me as a huge attack vector for malicious code. (Previously.)
New Zealand “Lesbian Navy Captain Faces Court Martial After $100M Ship Ran Aground, Caught Fire, Sank.” Since that happened all the way back in 2024, they’re certainly not rushing to justice…
Apple has some new computers out, so here’s M5 Pro vs. M5 Max benchmarks. My trailing edge consumer ass is still on an Intel-based MacBook Pro…
“Japanese companies are paying older workers to sit by a window and do nothing—while Western CEOs demand super-AI productivity just to keep your job.” Seems like there should be a happy medium between those two extremes…
A bunch of AI-related news has popped up this week, so let’s do a roundup.
Some AI companies are complaining that TSMC is killing the AI boom by not expanding rapidly enough:
Asianometry notes that TSMC’s caution at expanding is amply justified by the boom-and-bust nature of the semiconductor industry:
“I’m hearing many similar views in the Silicon Valley Borg that TSMC is the break or limiter on the AI boom, as if they’re the reason why we don’t have AGI yet. Because they didn’t and still don’t believe.”
“If we can ever say that a company that spent $41 billion on capital expenditure in 2025, with another $53 to $56 billion in 2026 planned, is sitting on its hands, doing nothing.”
“TSMC having 90% share of the AI chip market looks pretty unhealthy. That should go down and it will. Samsung seems to be doing well so far.”
“The cold, hard reality is that shortages are a fact of life in semiconductors, as are horrific gluts.”
“What we are flippantly labeling as TSMC we really mean is the AI supply chain. And that supply chain is as complicated as you can possibly imagine. Like an iceberg, it looks big enough on the surface of the water, but goes way far deeper underneath. TSMC has thousands of suppliers in two categories: Equipment like the famed ASML lithography tools and materials like photoresist, silicon wafers, acid etch gases and so on. These are not generalized tools and materials. They are not fungeible like AWS compute units.”
“And then there are the memory guys. You cannot ship an AI system without memory. DRAM and NAND. Nvidia’s AI chips use a special form of DRAM called high bandwidth memory, and they use quite a lot of it. The memory industry is just as consolidated as the logic industry, with the major players being Samsung, SK Hynix and Micron.”
“The chip guys are last to know when the party is getting started, but first they get batoned in the face when the police shut things down.”
He points out that semiconductor manufacturers have log supply chains. He uses a different metaphor (the beer distribution game, or a bullwhip), but back when I was working at Applied Materials, it was described as trains linked together with slinkys. First software takes off, then hardware gets yanked along, then the chip manufacturers get yanked, and then, finally, semiconductor equipment manufacturers get yanked into motion, and shortly after that happens, the bust hits the front of the train, and the trailing cars all crash into each other. It’s a regular boom/bust cycle.
“From 1961 to 2006, electronics consumption in the United States grew positively but with wild volatility swings between 0 to 20%. But for the semiconductor makers, that translates to swings anywhere from 20% to 40%. And for the equipment makers, it is amplified even more, plus or minus 60%. The whip hits particularly hard in the semiconductor industry because of the industry’s long lead times. It takes 4.5 months to fabricate and package a chip. It takes 18 months to 2 years to build a fab. Meaning from shovels down to producing chips, and it takes 12 to 18 months to produce and install something like an EUV machine into the fab. Another 6 months before that machine actually starts patterning wafers.”
“Long lead times mean having to make very long demand forecasts, which leads to extreme volatility swings during up and downturns even if those up or downturns are relatively small.” People forget that in 1998, during the time we now think of as the DotCom Boom, there was a small semiconductor downturn that had Applied Materials forcing employees to take unpaid leave.
“ASML just reported 2025 earnings, and we see the bullwhip in full effect. TSMC raised capital expenditure 35% but ASML announced €13.2 billion of net new bookings. Analysts had expected just €6.32 billion. This is because ASML collected orders not just from TSMC, but also Samsung, Intel and the memory guys. When it rains it pours, right? Again, this is why I fear that another AI foundry would not mean our compute shortage is solved, because ultimately, when those foundries start scaling their capacity, they all go to the same suppliers.”
He goes over how car manufacturers cancelled orders during Flu Manchu, and then scrambled when the economy took off afterwards. “TSMC was trying to discern between double booked orders and real demand, which is not an uncommon experience for them. Customers lie about their own demand all the time, or at least we can say that they are eternally optimistic. TSMC tried to respond in 2022. The Taiwanese giant poured $36 billion into capital expenditure. They went to their suppliers and pushed like no tomorrow.”
“It turned out those customers really were double booking orders and artificially inflating demand. When the macro environment turned in 2022, the automotive, smartphone, and PC chips that were so hot during the COVID era fell out of vogue and customers started cutting orders.”
“Meanwhile, deeper down in the supply chain, TSMC and the rest of the semiconductor industry were getting bullwhipped by COVID hangover. Utilization at TSMC’s multi-billion dollar N7 fabs crashed, Semi analysis wrote in April 2023. Now, Semi analysis data indicates that the 7nm utilization rates were below 70% in Q1. Furthermore, Q2 gets even worse with 7nm utilization rates falling to below 60%. This is primarily due to weakness in both smartphones and PCs, but there is a broader weakness in most segments. A fab’s break even utilization rates are about 60% to 70%. So those N7 Taichung fabs were taking financial losses potentially on the order of hundreds of millions, maybe even billions. The financial burdens of low utilization are another reason why I’m skeptical another AI foundry could have rushed into the AI chip fray to save the day.”
He says that Intel incurred losses during this period due to an unnecessary fab expansion, which is probably true, but that was a secondary factor next to their longer running problem of getting their process wrong.
“ChatGPT was released in November 2022, and that kicked off a massive increase in capex amongst the hyperscalers in particular, but it sure seems like TSMC didn’t buy the hype. That lack of increased investment earlier this decade is why there is a shortage today and is why TSMC has been a de facto break on the AI buildout/bubble.”
“I recall news in mid 2024 of TSMC struggling with CoWoS capacity bottlenecks and yield problems, including one design issue that caused cracks in the Nvidia chips packaging.” CoWoS is Chip on Wafer on Substrate, which involves fabbing an interposer as a substrate for faster connections between your processing chips and memory.
“I also recall news in late 2024 noting how the vendors in charge of making the server racks for Nvidia’s Blackwell servers struggled with overheating, liquid cooling leaks, software bugs, and connectivity issues. Such technical difficulties delayed server deployment until early to mid 2025, creating a weird situation for several months where TSMC was pumping out chips that just went into storage. So that gated things, because you don’t scale until you first fix the technical problems.”
Then there’s the power-scaling issue, which is a whole ‘nuther can of worms.
There’s a lot of talk about a SaaSpocalypse going on thanks to a new AI tool. (SaaS is “Software as a Service.” Instead of hosting your own payroll or sales-tracking or whatever servers, you hire a company that already has cloud software setup to do it and you just tie into that, which can considerably reduce startup costs. A whole lot of successful new tech companies over the last decade plus have been SaaS companies.)
The software sector was jolted overnight with what analysts are calling a “SaaSpocalypse” — a sudden and severe selloff triggered by new artificial intelligence tools unveiled by US AI startup Anthropic. The episode has sharpened investor fears that AI is no longer merely helping software companies but may now begin replacing them.
Anthropic has expanded its enterprise AI platform, Claude Cowork, by launching 11 new plugins aimed at automating a wide range of professional tasks. Claude Cowork is an agentic, no-code AI assistant built for corporate users, allowing companies to automate workflows without writing software. The new plugins are designed to handle tasks across legal, sales, marketing and data analysis functions. The most recent addition is Anthropic’s Claude Legal agent, which can perform routine legal work such as document and contract review, and compliance checks.
Anthropic has said that the tool does not provide legal advice and that all AI-generated outputs must be reviewed by licensed attorneys. Even so, the breadth of automation signals a step change in how much white-collar work AI systems can now perform.
Productivity — Manage tasks, calendars, daily workflows, and personal context
Enterprise search — Find information across your company’s tools and docs
Plugin Create/Customize — Create and customize new plugins from scratch
Sales — Research prospects, prep deals, and follow your sales process
Finance — Analyze financials, build models, and track key metrics
Data — Query, visualize, and interpret datasets
Legal — Review documents, flag risks, and track compliance
Marketing — Draft content, plan campaigns, and manage launches
Customer support — Triage issues, draft responses, and surface solutions
Product management — Write specs, prioritize roadmaps, and track progress
Biology research — Search literature, analyze results, and plan experiments
A lot of those are already automated elsewhere, but I suspect a lot accountants and paralegals just felt a goose strut across their grave. On the other hand, who is really going to turn over, say, Accounts Payable to an AI? One glitch, and your entire bank account is drained…
If it works (a big if, give so many AIs are prone to hallucinations), this is potentially good news for Anthropic and the companies using their tools, and bad for SaaS companies and the employees currently doing those jobs.
I note there’s no plugin for technical writing…yet.
And Google Cloud ended 2025 at an annual run rate of over $70 billion, representing a wide breadth of customers, driven by demand for AI products.
We’re seeing our AI investments and infrastructure drive revenue and growth across the board. To meet customer demand and capitalize on the growing opportunities we have ahead of us, our 2026 CapEx investments are anticipated to be in the range of $175 to $185 billion.”
Remember how Nvidia was going to invest $100 billion in OpenAI? Yeah, not so much.
In September 2025, Nvidia and OpenAI announced a letter of intent for Nvidia to invest up to $100 billion in OpenAI’s AI infrastructure. At the time, the companies said they expected to finalize details “in the coming weeks.” Five months later, no deal has closed, Nvidia’s CEO now says the $100 billion figure was “never a commitment,” and Reuters reports that OpenAI has been quietly seeking alternatives to Nvidia chips since last year.
Reuters also wrote that OpenAI is unsatisfied with the speed of some Nvidia chips for inference tasks, citing eight sources familiar with the matter. Inference is the process by which a trained AI model generates responses to user queries. According to the report, the issue became apparent in OpenAI’s Codex, an AI code-generation tool. OpenAI staff reportedly attributed some of Codex’s performance limitations to Nvidia’s GPU-based hardware.
After the Reuters story published and Nvidia’s stock price took a dive, Nvidia and OpenAI have tried to smooth things over publicly. OpenAI CEO Sam Altman posted on X: “We love working with NVIDIA and they make the best AI chips in the world. We hope to be a gigantic customer for a very long time. I don’t get where all this insanity is coming from.”
Microsoft’s Copilot chatbot has become central to its artificial-intelligence strategy as the company’s close partnership with OpenAI diminishes. But the effort to build it up as a ChatGPT alternative has been tough going.
Confusing brand positioning and interoperability problems have frustrated users, current and former employees who have worked on Microsoft’s AI products said.
Interoperability problems? With a Microsoft product?
Only a small proportion of subscribers to Microsoft’s enterprise suite use Copilot, and the percentage who favor it over Google’s Gemini or other tools has decreased in recent months, according to data reviewed by the Journal.
The stakes are high for Microsoft because Copilot is core to a push by Chief Executive Satya Nadella to transform Microsoft into an AI-first company, much as he transformed it into a cloud-first company around a decade ago. Copilot is one of Nadella’s top priorities, current and former executives said.
Microsoft shares tumbled after its earnings report last week sparked investor concern that growth in its most important unit, the Azure cloud-computing business, is slowing, and that its AI business is reliant on OpenAI while Copilot remains unproven. Shares fell nearly 3% Tuesday amid a slide in software stocks prompted by fresh concerns that AI tools will make enterprise subscriptions less necessary.
For other AI companies, we merely suspect they’re evil. For Microsoft (and Google), we already know they’re evil…
Another day, another Ken Paxton lawsuit, this time against smart TV manufacturers he accuses of illegally spying on Texans.
“Smart TVs are watching you back.”
That’s how Texas Attorney General Ken Paxton opens a series of new lawsuits accusing major television manufacturers of secretly surveilling Texans inside their own homes.
Paxton has filed suit against five major television companies—Samsung, Sony, LG, Hisense, and TCL—alleging they unlawfully collected and monetized detailed viewing data from consumers without meaningful knowledge or consent. Two of the companies named in the lawsuit, Hisense and TCL, are based in China, a fact Paxton says raises additional concerns about data security under China’s National Security Law.
According to the lawsuit, the companies embedded Automated Content Recognition (ACR) technology into their smart televisions. The software allegedly captures screenshots of what appears on a user’s television screen as frequently as every 500 milliseconds, allowing companies to monitor what consumers watch across streaming platforms, cable television, and even external devices connected by HDMI, such as gaming consoles or laptops.
Taking a picture every half-second and uploading it sounds something that would definitely show up in your router logs, assuming you have things set up to keep an eye on it. And I rather doubt Samsung or LG have much use for that data clogging up their servers.
But the Chinese manufacturers? Yeah, I can see them intermittently sampling everything until they find a nice juicy target to turn on and aim the full spyware capabilities at.
The attorney general’s office alleges that the data is transmitted back to the companies in real time, used to build detailed consumer profiles, and then sold or shared for targeted advertising purposes—often without consumers understanding what they agreed to or how the technology works.
“Companies, especially those connected to the Chinese Communist Party, have no business illegally recording Americans’ devices inside their own homes,” Paxton said in a statement. “This conduct is invasive, deceptive, and unlawful. The fundamental right to privacy will be protected in Texas because owning a television does not mean surrendering your personal information to Big Tech or foreign adversaries.”
I wonder if the spyware capabilities Paxton alleges are present in these TVs can be easily demonstrated. I wouldn’t put it past China to include some capabilities, but demonstrating that they’re actually present in something like a court of law might prove difficult.
Maybe LG and Samsung are spying on you to sell you ads:
Kneon at Clownfish TV reports that LG TVs are automatically installing Microsoft Co-Pilot AI, and that it listens to your conversations are serves you ads based on it…
Good news for the central Texas economy: Samsung’s new Taylor fab is going to build AI chips for Telsa.
Tesla’s next-generation AI6 chip, designed to power the Full Self-Driving (FSD) system, will be manufactured at Samsung’s new, massive chip fabrication plant in Texas, strategically located near Tesla’s Model Y and Cybertruck production facilities.
They’re both on the outskirts of east Austin, though different parts of east Austin (Telsa’s plant is south, and Samsung’s new Taylor fab way north). Google maps say they’re about 27 miles apart as the crow flies, or 36 minutes apart if you take the 130 toll road.
“Samsung’s giant new Texas fab will be dedicated to making Tesla’s next-generation AI6 chip. The strategic importance of this is hard to overstate,” Elon Musk wrote on X late Sunday night.
Musk continued, “Samsung currently makes AI4. TSMC will make AI5, which just finished design, initially in Taiwan and then Arizona.”
“Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency,” he noted, adding, “This is a critical point, as I will walk the line personally to accelerate the pace of progress. And the fab is conveniently located not far from my house.”
As to Musk “personally walking the line to accelerate the pace of progress,” presumably in a full bunny suit, I fail to see how that’s going to help anything. Most modern fabs have extremely efficient, streamlined operations that aren’t amenable to improvement via random billionaires walking their floor.
Samsung confirmed that it will produce Tesla’s AI chips as part of a $16.5 billion chipmaking deal, marking a major win for its underperforming foundry division, according to Bloomberg.
A foundry is a fab that manufactures chips for other companies rather than it’s own designs. Samsung has both fabs for its own chips and a foundry business.
The AI6 chip will be produced at Samsung’s chip plant in Taylor, Texas. The new facility was partially funded through the Biden-Harris administration’s CHIPS and Science Act and is focused on manufacturing advanced logic chips for mobile devices, 5G, high-performance computing, and AI applications.
My previous critique of the CHIPS act can be found here.
Tesla’s partner in the deal, Samsung’s Taylor Fab semiconductor location — which broke ground in 2022 and is expected to be fully operational in the City of Taylor come 2026 — aims to increase the production of semiconductor-related initiatives that’ll “power next-generation technologies” including 5G, high-performance computing, and various forms of AI.
The South Korean company, Samsung Technologies, first planted its roots in Texas in 1996, in Austin.
Tesla has multiple locations across the Lone Star State, including its primary manufacturing hub and headquarters near Austin, the “Gigafactory,” which boasts over 10 million square feet in floor space or 2,500 acres.
Snip.
Samsung Electronics announced on Monday it had signed a $16.5 billion contract with a “large global company” — revealed by Musk in the aforementioned X posts, although kept anonymous by Samsung. The contract’s tenure spans from July 24, 2025 to December 31, 2033.
Musk clarified in another X post that he believes the $16.5 billion number is “just the bare minimum,” and that the “actual output” of this collaboration between Samsung and Tesla will be “several times higher.”
There’s been a lot of (somewhat justified) concern over the dependence of American tech companies like Nvidia and Apple on Taiwan-based TSMC to fab their cutting edge sub-10nm chip designs. The problem has been foolishly phrased as “America can’t make chips anymore,” which is false, as American fabs churn out millions of chips every month. The problem is “lack of available domestic sub-10nm wafer starts,” a problem exacerbated by the fact that there are only three companies in the world that have the knowledge and resources to building cutting edge fabs, the cost of which is now pushing $20 billion.
Fortunately for Texas, Samsung is one of those three companies, and together with TSMC’s new fab in Arizona and Intel’s new fab in Ohio, a lot of those capacity constraint problems are being addressed.
President Trump announced his tariffs on countries, especially those that tariff goods from the United States.
President Donald Trump on Wednesday imposed sweeping new tariffs on all imported goods and unveiled a detailed list of reciprocal duties targeting more than 60 countries, asserting that the move is necessary to combat trade imbalances and restore U.S. manufacturing.
“This is Liberation Day,” Trump said during a Rose Garden ceremony, holding up a printed chart of countries and their new tariff rates. “For decades, our country has been looted, pillaged, raped and plundered by nations near and far, both friend and foe alike.”
The tariffs, which he described as “reciprocal,” fulfill a key campaign pledge and are aimed at pressuring trade partners to lower their own barriers. The administration expects the new rates to remain in place until the U.S. narrows a $1.2 trillion trade imbalance recorded last year.
But the extensive list of tariffs also threatens to upend the U.S. economy, as many — but not all — economists say they amount to taxes on American companies that will be passed down to consumers.
Trump held up a chart while speaking at the White House, showing the United States would charge a 34 percent tax on imports from China, a 20 percent tax on imports from the European Union, 25 percent on South Korea, 24 percent on Japan and 32 percent on Taiwan.
The centerpiece of the announcement is a 10 percent universal baseline tariff on all imports, effective immediately. For instance, Chinese imports are now subject to cascading tariffs of 10, 20 and 34 percent, for a total of 54 percent.
In addition, Trump’s administration imposed country-specific reciprocal tariffs on nations it accuses of unfair trade practices — including India, Vietnam, and the European Union, in adding to China. The rates are calibrated at approximately half the rate those countries impose on U.S. goods.
For example, China, which Trump said charges 67 percent in tariffs on U.S. goods when factoring in non-tariff barriers, will now face a 34 percent reciprocal tariff under the new system, in addition to the 10 percent baseline tariff and the 20 percent tariffs already in effect. Vietnam, assessed at 90 percent, will face a 46 percent tariff; India at 52 percent will now see 26 percent duties; and the EU, which imposes 39 percent, will be met with a 20 percent response, according to the White House chart.
This is a “devil in the details” issue that has a lot of ramifications depending on how the directives are written. But several of those countries are big players in semiconductors, so here’s a quick and dirty look at winners and losers if those tariffs stay in place a significant amount of time.
The main countries here, along with the reciprocal tariffs being applied to them:
Taiwan (32%)
South Korea (25%)
China (34%)
European Union (not a country, but they play one on TV) (20%)
Japan (24%)
Singapore (10%)
Israel (17%)
Save a few smaller, older fabs here and there, that’s pretty much 99% of semiconductor manufacturing, though Vietnam (46%) and the Philippines (17%) do a lot of semiconductor package assembly work, and the tariffs may apply to them, depending on wording.
So let’s look at the business Losers and Winners in the space. (Note: You might find this post useful, as it defines some of the semiconductor industry terms used here.)
Losers
TSMC: As the world’s biggest and most important chip foundry, the Taiwanese tariffs will hit TSMC hard. Their U.S. fab in Arizona isn’t ready for production yet, so all their chips will (theoretically) get hit with tariffs, assuming Trump doesn’t grant them a waiver because they’re already constructing a plant. But if they do go into effect, possibly even more heavily impacted will be:
TSMC customers, including Apple, Nvidia and AMD. All three get their very highest-end, cutting edge, sub-10nm chips fabbed there. For Apple, the M-series and A-series chips made there form the heart of all their Macs and iPhones. Likewise, Nvidia gets its highest end GPU/AI/etc. chips fabbed by TSMC. AMD’s most powerful CPU’s are also fabbed by TSMC, though some lower end chips are made elsewhere (like GlobalFoundries).
Tokyo Electron: Japan’s biggest semiconductor equipment manufacturer assembles pretty much all their equipment in their home country. 24% tariffs may make their equipment uneconomical compared to rivals Applied Materials and LAM Research.
South Korean DRAM manufacturers Samsung and SK Hynix: 25% tariffs will definitely impact sales in a market segment whose overall margins (robust in booms, and barely breaking even during busts) are thinner than others.
Every American electronics company that uses DRAM. Which is pretty much every American electronics company.
Every American AI boom company. Their data center costs are going up, while those of their foreign competitors are not.
Korean flat panel display manufacturers Samsung and LG Semicon, who between them control over 50% of the market.
Every American TV and monitor manufacturer, the vast majority of which have their devices manufactured overseas.
UMC: They’d fallen woefully behind TSMC for foundry work, and they won’t be winning much additional American business now.
Every company trying to build a sub-10nm fab in the U.S., as steppers from Netherlands-based ASML just got more expensive and the competition to obtain them might have increased.
Pretty much every fab in China just got more screwed…but they were pretty screwed (and trailing badly) before.
American fabless chip startups: Their costs for getting chips to market probably increased.
Winners
Applied Materials, LAM Research and KLA Tencor. Buying competing Tokyo Electron equipment just got more expensive, and a bunch of companies now have incentives to build fabs in America.
Intel: Assuming they’ve finally got their process technology sorted out (a big if), they’re well-positioned to take CPU market share from AMD and to grow their under-performing foundry business.
Micron (sort of): As the only American DRAM manufacturer, they can probably earn more per each chip produced domestically. But Micron has a lot of overseas fabs these days, and building new domestic DRAM fabs will take years.
GlobalFoundries: The costs of their global competitors just increased, so they can probably win more business for their domestic foundries…if they have the available wafer starts. But they have a lot of foreign fabs as well.
Samsung‘s US foundry business. Presumably the wafer starts for their Austin and Taylor fabs will see increased demand.
Maybe Texas Instruments, but I’m not sure how much mixed-signal and analog competition they have, and that’s their bread and butter.
Neutral
ASML: Being in the Netherlands and having TSMC as their biggest customer, you figure they’d be hurt, but no. You can’t get EUV steppers from anyone else, and I get the impression they’re building EUV steppers as fast as they possibly can already. Anyone building a cutting-edge fab will just have to pay more to get them.
Tower Semiconductor: Half their foundries are in Israel and half in the U.S., so I figure it’s a wash.
That’s my quick and dirty analysis. Of course, Trump is using tariffs like a battering ram to smash foreign tariffs, and if he’s immediately successful, there probably will only be minor hiccups in the global supply chain. But if not, a whole lot of disruption might lie ahead, and it usually takes a minimum of 3-5 years to bring a new fab online.
I know that any time I talk about semiconductors, a significant percentage of my readership’s eyes glaze over, but this is Big Freaking News.
Intel shares rose 6% in premarket trading after Reuters reported that Taiwan Semiconductor Manufacturing, or TSMC, had approached US chip designers Nvidia, Advanced Micro Devices, and Broadcom about taking stakes in a joint venture that would operate the struggling chipmaker’s factories.
Four sources told Reuters that the Taiwanese chipmaking giant would run Intel’s foundry division under the new proposal, producing chips tailored to customer requirements but not owning more than 50%. The sources added that Qualcomm has also been approached about the venture.
TSMC is far and away the largest chip foundry (a company that builds chips for other companies, but doesn’t design its own chips) in the world, and the one with a clear technological lead over everyone else. TSMC has the third largest market cap of any semiconductor company.
Broadcom is the second-largest semiconductor company in the world by market cap, and they have their fingers in a lot of different pies: networking, wireless, storage, you name it. They’re generally considered a fabless chip designer, but the company is such a weird amalgamation of other companies (what we call Broadcom used to be Avago until they acquired Broadcom in 2016) that they might still have a lower end fab or two lurking somewhere in the company. They also use TSMC as a foundry, though I’m not sure how extensively. They’ve also recently made a big move into software, acquiring CA Associates and VMWare, among others.
Nvidia is a fabless chip designer (the sort of company that contracts with foundries to fab their chips) that went heavily into high end GPUs (the chips that render video for your PC, in Nvidia’s case geared toward high end games and other highly demanding tasks), then crypto-mining chips, and more recently into chips geared for AI applications, all very lucrative market segments, which has made Nvidia not only first among semiconductor market cap, but among the largest companies by market cap in the world (along with Apple and Microsoft). Nvidia has their chips fabricated by TSMC, as well as some by Samsung and GlobalFoundries, which was spun off from…
Advanced Micro Devices, which used to be an Integrated Device Manufacturer (or IDM, a company designs their own chips and builds them in their own fabs) creating Intel-compatible CPUs, but eventually spun off their fabrication plants as GlobalFoundries because they couldn’t keep up with Intel’s capital spending. AMD also has some of their highest end chips fabricated by TSMC. If AMD were to help take over Intel, it would be an extremely ironic ending to a longtime rivalry.
Qualcomm is a lot like Broadcom: A mostly fabless design house with its fingers in lots of different pies, and they’re about the sixth largest semiconductor company by market cap. Broadcom tried to acquire Qualcomm in 2017-18 and was blocked by the Trump45 administration.
Intel is an IDM, and for decades was the undisputed “chipzilla” of the semiconductor world. Intel’s CPUs were the dominant processor for the vast majority of the last 40 years and a huge ingredient for helping create the PC revolution. Intel used to be the technology process leader as well, but somewhere along the way they screwed up their sub-10nm process nodes, allowing TSMC to take the process technology crown. Indeed, they screwed up so badly that they’ve been forced to have TSMC fab some of its highest end chips. Despite having a vast number of fabs, Intel’s market cap has slipped down to 16th among semiconductor companies.
Back to the piece:
The sources noted that the Trump administration is exploring ways to revive Intel and strengthen US manufacturing under the ‘America First’ agenda. They added that TSMC’s joint venture pitch to chip designers took place before the company, alongside President Trump, announced plans last month to invest $100 billion in semiconductor manufacturing in the US, building on its existing $65 billion investment in its Phoenix, Arizona, factories.
Any deal between TSMC and Intel would be subjected to approval from the Trump administration.
If the Trump Administration’s goal is to increase available sub-10nm wafer starts (and it should be) and maintain American control of Intel’s fabs, then this proposal is a win-win. Intel’s fabs plus TSMC’s tech would create a foundry powerhouse. It wouldn’t happen overnight (nothing in semiconductors happens overnight), but probably in 12-24 months, depending on how quickly the new entity can acquire the necessary pieces of equipment to upgrade Intel’s fabs to thee new tech (I’m guessing that the availability of ASML steppers will, as usual, be the gating factor). And all this without the tens of billions in taxpayer subsidies for the CHIPS Act.
If this goes through, it would have mostly winners, with a few losers:
Winners
Every company that’s part of the deal. TSMC gets to radically expand production capacity without spending $20 billion+ to build a new fab. Nvidia, AMD, Broadcom and Qualcomm gain a lot more capacity for expanding production of their high end chips. Ditto for Apple (who’s not part of the deal, but who is TSMC’s biggest customer and a big demand driver for cutting edge fab capacity) and every other consumer of sub-10nm chips.
AMD additionally gets the egoboo of partially taking over its longtime hated rival and confirming it’s crown as the x86/x64 chip manufacturer of choice. Plus their then-risky decision to spin off GlobalFoundries looks like a genius move in hindsight.
The Trump Administration, which gets to take credit for vastly increasing American Foundry capacity at zero additional taxpayer expense and keeps Intel under American control.
Semiconductor equipment manufacturers like ASML, Applied Materials, LAM Research, Tokyo Electron and KLA (short term). It’s likely most or all of those companies (along with smaller players like Axcelis and Teradyne) will receive a bump in extra sales from leveling up Intel’s fabs to run TSMC’s process.
American chip startups: With so much high end capacity becoming available, existing and potential chip startups are going to look like more attractive investment capital opportunities.
ARM Holdings: ARM doesn’t make chips, they’re an IP design house that licenses their functional chip blocks to other chip designers. Just about every foundry and IDM is a licensee (yes, including Intel and TSMC), so unleashing more chip designs will almost certainly result in more royalties for ARM. (Nvidia tried to buy ARM in 2020, and regulators quashed that idea good and hard.)
Intel investors, who will either get a big lump-sum payment or shares in the new, probably far more profitable company (depending on how the buyout is structured).
Even Intel wins long-term by unleashing existing fab capacity to take on new business not tied to its faltering CPU manufacturing model. And actually, with TSMC’s process, Intel has a chance to recover in the CPU space as well.
Losers
Samsung: Along with TSMC and Intel, Samsung (which has both IDM and foundry components) has some of the best sub-10nm process tech in the world. They gain a whole lot of unleashed competition and stand on the outside looking in.
Intel‘s dreams of reclaiming their spot at the top of the heap, and suffering the indignity of being partially owned by AMD. How the mighty have fallen.
Every Chinese fab, which goes from “very far behind” to “even further behind.”
Semiconductor equipment manufacturers (long term): They better enjoy the out-of-band upgrade money from retrofitting Intel’s fabs, as it will likely mean a significant delay in anyone building a new cutting edge wafer fab for quite a while. And having two of their biggest customers team up is probably going to put them under a lot of downward pricing pressure.
GlobalFoundries (and other trailing edge foundries) might lose some business, but there’s very little overlap between Intel/TSMC cutting edge processes and GlobalFoundries trailing-edge fabs. Ditto UMC.
Are there anti-trust concerns with such a heavy accumulation of cutting edge process technology? Oh yeah. Big time. But almost all of those concerns were already there in some form or another thanks to the interconnected “cooperation” nature of the industry. All those companies going in with TSMC were already getting chips fabbed by TSMC. Samsung could try to claim that the deal would result in TSMC having a de-facto monopoly on sub-10nm foundry business, but it wouldn’t start with one, and that business isn’t the whole of foundry business (though it is the most profitable part), much less semiconductors as a whole.
Given that this would go a long way toward achieving Trump’s goal of increasing cutting edge fab capacity in America, I would imagine that the Trump47 administration could very well be persuaded to let this deal go through.
Slow Joe continues sliding down the slope of senility, Democrats continue freaking out over same, the media continues to be shocked that the media hid Biden’s decline, Democrats gear up to commit more voting fraud in November, tractors join the culture wars, Skydance eats Paramount, and postal rates are going up again. It’s the Friday LinkSwarm!
President Joe Biden struck a defiant tone during what was perhaps the most consequential press conference of his political career, insisting that he is the best candidate to take on Donald Trump in November, even as he stumbled through several answers.
Biden read prepared remarks off a teleprompter and answered questions from a pre-selected list of reporters Thursday night at NATO’s 75th anniversary summit, addressing a range of subjects including the history of NATO, Russia’s war against Ukraine, inflation, and Israel’s war against Hamas. The embattled president showed signs of his age throughout the event, as he coughed, whispered, stumbled over his words, and at time lost his stream of thought, at one point even referring to Vice President Kamala Harris as “Vice President Trump.”
“Look, I wouldn’t have picked Vice President Trump to be vice president did I think she was not qualified to be vice president,” Biden said, defending his choice of Harris as his running mate. At the end of the press conference, Biden told reporters to “listen to him,” in response to a question about the gaffe.
Parkinson’s disease specialist from Walter Reed Medical Center visited the White House at least nine times in the past year, according to journalist Alex Berenson of Unreported Truths, while the NY Post has reported that a cardiologist was present during one of the visits.
Dr. Kevin R Cannard traveled to the White House’s medical clinic each time, meeting with either President Joe Biden’s personal physician Dr. Kevin O’Connor, or a naval nurse who coordinates care for the president and other senior officials. O’Connor notably gave Biden a clean bill of health after his February annual physical.
The visits spanned July 28, 2023 with the latest being March 28 of this year. That said, Berenson notes that the most recent logs are from April 1, so it’s unknown if Cannard has visited more recently.
The question isn’t whether Joe Biden is suffering from cognitive declines, the questions is how many kinds of cognitive decline is Joe Biden suffering from?
“Biden’s Cognitive Collapse: Greatest Media Scandal We’ve Ever Seen. With Russia collusion, they were inventing things we couldn’t see and trying to convince us that they happened. With the Biden cognitive failures, they were trying to convince us that something we all saw didn’t happen and wasn’t happening.”
You saw the debate and the interview.
Joe is not well. He should not be president, it’s a national security risk. This is what the 25th Amendment is made for.
There have been many media scandals. Rathergate comes to mind. But most immediately, Russia collusion was the most aggressive and sustained media misinformation campaign lasting years. It operated on the level of using bits and pieces of information and disinformation to try to convince us that something we could not see (collusion) did in fact happen.
The media conduct towards Biden’s cognitive decline operated on a different level.
We saw it. We wrote about it. But for years, at least since the 2020 election cycle, the media did its best to convince you that you didn’t see what you saw. The media didn’t try to convince you that something that didn’t exist existed, it tried to convince you that something that existed didn’t exist.
If we accept the actions and outcomes that are visible from Democrats right now, their definition of “democracy” is apparently to dismiss the will of tens-of-millions of Democrat party voters, and instead install a candidate the DC insiders select.
Democrats and even Biden administration officials are being very open about their intent. They are dismissing Joe Biden and debating the installation of their chosen alternative; all while trying to jail their political opponent.
Can democrats see their version of “democracy” is identical to horrible Vladimir Putin?…
Additionally, having just returned from an extended visit to Russia, where I literally spent exhaustive time researching how the government views their role within the social compact – and its consequence upon the average population, the “we know better” outlook currently on display by Democrat influence operations in DC is stunningly similar.
Democrats are defending “The Motherland,” where “mother” is their retention of omnipotent power. Yes, Democrats are Putin.
“Biden Officials Gave Radio Stations Questions They Could Ask Biden During Interviews; They Complied.” Of course they did. (Hat tip: Ace of Spades HQ.)
Evidently donors aren’t interested backing a senile loser, as Biden campaign contributions have fallen off dramatically. “Contributions from large donors alone could be down by more than half this month and are lower across the spectrum, according to NBC News. ‘It’s already disastrous,’ a source close to the re-election effort told the outlet about the state of fundraising for the Biden campaign. ‘The money has absolutely shut off,’ another person close to the campaign said.” Now we get to see if Democrats will follow the will of actual voters who cast their ballots for Biden, or a donor class insisting he be kicked to the curb.
Democrats oppose a bill requiring American citizenship to vote. because of course they do. Getting illegal alien ballots in the system is one of the fraud vectors they need to stay in power. It’s amazing Republicans even need to specify that in a law.
Ditto Michigan, where Democratic governor Gretchen Whitmer signing bills eliminating the board of canvasser’s investigative powers, instead requiring the board to refer allegations of fraud to county prosecutors. So they can make sure Soros-backed prosecutors can bury any fraud.
This is potentially huge: “Court Holds Federal Ban on Home-Distilling Exceeds Congress’ Enumerated Powers.”
Yesterday, in Hobby Distillers Association v. Alcohol and Tobacco Tax and Trade Bureau, a federal district court in Texas held that federal laws banning distilled spirits plants (aka “stills”) in homes or dwellings exceed the scope of Congress’ enumerated powers. Specifically, the court concluded that the prohibitions exceed the scope of the federal taxing power and the Interstate Commerce Clause, even as supplemented by the Necessary and Proper Clause. The court further entered a permanent injunction barring enforcement of these provisions against those plaintiffs found to have standing (one individual and members of the Hobby Distillers Association.) The plaintiffs were represented by attorneys at the Competitive Enterprise Institute, and background on the case (and the various filings) can be found on CEI’s website here.
Hobby Distillers Association has the potential to be a significant post-NFIB challenge to the expansive of use of federal power.
All sorts of federal regulatory shenanigans that depend on the Commerce Clause may be headed for the scrapheap of history… (Hat tip: Instapundit.)
Annals of evil: Porsche executive convicted for of throwing her newborn daughter out of a window to further her career. “Katarina Jovanovic, a Porsche executive in Germany, chose her career over family by throwing her newborn daughter out a 12-foot window to her death, and is now headed to jail for seven and a half years.” I wonder if German women’s prisons have shankings…
Sen. Ted Cruz (R-TX) has launched an investigation into whether the Biden administration used the “obscure Intergovernmental Personnel Act program” to fund the salaries of Big Tech employees as part of an executive order.
“To complete every action, agencies would have had to . . . bring on AI fellows by recruiting temporary — but influential — AI staff from external organizations through the Intergovernmental Personnel Act (IPA) program. Critics, however, have raised reasonable concerns that these influential AI fellows are shaping federal policy to benefit their organizations’ funders and not the American people,” explained Cruz.
“Moreover, as federal agencies request increased funding for AI hiring, it is important Congress understand the extent to which, and how, agencies have already acquired AI staff in response to the expansive and demanding AI Executive Order.”
In October 2023, Biden issued an executive order to establish “new standards for AI safety and security.” The order also aims to address “best practices” for authenticating content and calls on Congress to pass “bipartisan data privacy legislation.”
Six months after the issuance, the White House stated they had completed all the actions in the order.
In Cruz’s investigation announcement, he casts doubt on whether hiring “only 150 people into AI roles” was enough to be able to complete the required work. Cruz also highlighted a number of reported incidents where, through the Intergovernmental Personnel Act (IPA) program, Big Tech CEOs funded salaries of employees working in government agencies.
“In effect, large AI technology companies are influencing the Biden administration’s AI policy from the inside and advancing their own anti-competitive agenda to shape the future of the AI industry,” Cruz said.
Elon Musk announced on Thursday that social media platform X will sue ‘perpetrators and collaborators’ who have colluded to control online speech, as revealed on Wednesday by an interim staff report released by the House Judiciary Committee.
“Having seen the evidence unearthed today by Congress, 𝕏 has no choice but to file suit against the perpetrators and collaborators in the advertising boycott racket,” Musk wrote on his platform, adding “Hopefully, some states will consider criminal prosecution.”
The House report details a coordinated effort by the World Federation of Advertisers (WFA) and its Global Alliance for Responsible Media (GARM) initiative to demonetize and suppress disfavored content across the internet.
As we noted on Wednesday, the WFA is a global association representing over 150 of the world’s biggest brands and over 60 national advertiser associations which created GARM in 2019.
This alliance quickly amassed significant market power, representing roughly 90% of global advertising spend, which amounts to nearly one trillion dollars annually.
GARM’s Steer Team reads like a who’s who of corporate America, including heavyweights such as Unilever, Mars, Diageo, Procter & Gamble (P&G), GroupM, AB InBev, L’Oréal, Nestlé, IBM, Mastercard, and PepsiCo. These corporations not only wield immense economic influence but are now revealed to be leveraging this power to control online discourse under the guise of “brand safety.”
“In New York City, hotels that have converted into shelters for hordes of illegal aliens have been given over $1 billion in taxpayer money to keep them in business. As reported by Fox News, the average hotel room for an illegal costs $156 per night, with some costing over $300 per night. As such, the city government has already spent at least $1.98 billion on housing for illegals, with 80% of that amount going to hotels or inns that have been converted into shelters, rather than to shelters operated by the city. Overall, the city has spent at least $4.88 billion on the mass migration crisis.” (Hat tip: The Other McCain.)
Another loss for Biden’s tranny school mandate. “Carroll Independent School District (ISD) won a preliminary injunction against enforcement of the revised Title IX regulations issued by the Biden administration in April. The rules were set to go into effect on August 1. Federal Judge Reed O’Connor of the Northern District of Texas issued the preliminary injunction on Thursday, July 11, the same day the Amarillo federal court issued an injunction in the case brought by the State of Texas regarding Title IX.”
Bad news on the tractor front: John Deere is going full woke, with DEI idiocy out the wazoo and pushing tranny ideology on children. Plus they’re closing an American plant to move the jobs to Mexico.
Chicken Soup for the Soul, the company that owned Redbox and Crackle, is shutting down. (Hat tip: Dwight.)
It’s not just U.S. companies that have problems with unions: Samsung’s is threatening a general strike in their high speed memory fab at Pyeongtaek. Any machine that goes down on a fab line needs to re-qualified, which is a gigantic, time-consuming pain in the ass. A car factory can resume production in last than a day, but fab can take several weeks to months to get production.
Return of the zombie mortgage. People who thought their second mortgages were written off after the 2008 crisis but didn’t get it in writing are now suffering a rude awakening.
Attorney General Ken Paxton announced today the launch of a new major initiative to protect citizens’ sensitive data from unauthorized exploitation by tech companies and artificial intelligence.
The initiative was launched under the umbrella of the Attorney General Office Consumer Protection Division and established a team for “aggressive enforcement” of state privacy laws. It will also “ensure companies respect Texans’ privacy rights and safeguard their personal data.”
According to a press release from Paxton’s office, the data protection team is set to be one of the largest privacy law enforcement teams in the entire United States.
“Any entity abusing or exploiting Texans’ sensitive data will be met with the full force of the law,” said Paxton. “Companies that collect and sell data in an unauthorized manner, harm consumers financially, or use artificial intelligence irresponsibly present risks to our citizens that we take very seriously.
“As many companies seek more and more ways to exploit data they collect about consumers, I am doubling down to protect privacy rights,” he continued. “With companies able to collect, aggregate, and use sensitive data on an unprecedented scale, we are strengthening our enforcement of privacy laws to protect our citizens.”
Specifically, the new team will focus on enforcing the Data Privacy and Security Act, the Identify Theft Enforcement and Protection Act, the Data Broker Law, the Biometric Identifier Act, the Deceptive Trade Practices Act, and federal laws such as the Children’s Online Privacy Protection Act and the Health Insurance Portability and Accountability Act.
“Texas has been a national leader in advancing conservative technology policy, and this initiative is the perfect complement to legislative wins in recent sessions as it will ensure Texas has the expertise and firepower to enforce laws that protect consumers and hold Big Tech accountable,” said David Dunmoyer—the Texas Public Policy Foundation Better Tech for Tomorrow campaign director.
“Big Tech companies have gleefully flouted laws like the Children’s Online Privacy Protection Act for years, and in the absence of meaningful federal action, this initiative demonstrates Texas’ willingness to once again step into the breach and fight on behalf of Texans,” he continued. “This initiative will only further cement Texas’ national leadership in this space.”
This is the latest development in Texas’ efforts to crack down on data privacy infringement. In mid-summer of last year, Gov. Greg Abbott signed the Texas Data Privacy & Security Act into law.
The law applies to primarily businesses and entities who conduct business in the state of Texas or produce a product consumed by Texans, process or engage with the sale of personal data, and who are not considered “small businesses” unless the business has its hand in transactions of personal data.
That enforcement effort sounds both needed and deserved, but the question is how you enforce those laws when they cows have not only left the barn, but have been sucked down and sliced up into thousands of vast international data farms far beyond the regulatory reach of the state of Texas.
Big data lives and breathes on personal data that you’ve agreed to give up in variegated clauses scattered throughout the sprawling text swamps of terms and conditions for online sites you use for free.
Have a Facebook account? Congratulations! Every bit of information you’ve shared with Facebook (your friends network, your interests, the sports teams you follow, the foods you favor, etc.) is now available to every partner of Facebook. And everyone partners with Facebook. If they have your email address or your phone number, they have your data.
Ditto Google, with the additional proviso that Google has sucked up and cataloged pretty much every public database in the world, plus every single search query you’ve launched, ever, and every web page you’ve ever viewed through Chrome.
Ditto Microsoft, for LinkedIn (yes, Microsoft bought LinkedIn), Windows, Explorer, Edge, Bing, etc.
Ditto Twitter for everything you’ve ever tweeted or liked there.
Ditto Sony, whose PlayStation Network data got hacked.
Ditto Apple, though they seem to have better privacy protection provisions than most, mainly because they make their money off hardware. This doesn’t make them the good guys, just the least bad buys.
And don’t forget state, location and federal government entities, whose data security is probably several orders of magnitude worse than the tech giants.
Given that there’s so much personal data out there, so much legally acquired, how do you go about putting the genie back in the bottle? It’s a near impossible task, given that the tech giants not only hire armies of lawyers to defend themselves from lawsuits, but also lobbyists to write laws protecting them from said lawsuits.
One place to start: Joining in a lawsuit where Facebook’s parent company Meta actually used stolen data to train AI, namely using a giant database of pirated books without paying authors. Paxton’s office could join one of the lawsuits against Meta, or file a new one on behalf of Texas authors whose work was used without compensation.
Catching a tech giant with their pants down while actually breaking the law may give Paxton leverage to address other privacy concerns, and possibly the chance to do some eye-opening discovery…
Samsung’s Texas fabs are evidently going to be the beneficiary of CHIPS Act subsidies.
The U.S. Department of Commerce (DOC) has announced that $6.4 billion will be sent to a Texas Samsung facility to bolster the supply chain of semiconductors.
The multi-billion dollar investment is part of a larger $40 billion dollar federal funding agreement as part of the CHIPS and Science Act.
As a White House press release states, the investment aims to “cement central Texas’s role as a state-of-the-art semiconductor ecosystem, creating at least 21,500 jobs and leveraging up to $40 million in CHIPS funding to train and develop the local workforce.”
This investment would be used at both the research and development facilities in Taylor and the expansion of the fabrication factory in Austin.
The Taylor facility isn’t just an R&D site, it’s a full-blown state-of-the-art fab, and they could start running the line as early as July. The chips Samsung will be producing are planned to be on their 4 nanometer node.
The City of Austin has previously identified semiconductor production as part of its Opportunity Austin economic expansion plan where the city sees itself as a “top global destination for businesses and investment.”
“We’re not just expanding production facilities; we’re strengthening the local semiconductor ecosystem and positioning the U.S. as a global semiconductor manufacturing destination,” said Kye Hyun Kyung, president and CEO of the Device Solutions (DS) Division at Samsung Electronics.
“To meet the expected surge in demand from U.S. customers, for future products like AI chips, our fabs will be equipped for cutting-edge process technologies and help advance the security of the U.S. semiconductor supply chain.”
As I’ve written before, semiconductor subsidies are the wrong solution for the wrong problem (especially if the Biden Administration demands Samsung pledge fealty to social justice before sucking the taxpayers teat). But if you are going to subsidize someone, and your goal is more cutting edge American fabs, then Samsung isn’t the worst recipient. Their fab tech is either second third best (depending on whether intel has actually gotten their act together or not) in the world behind TSMC, and 4nm is good enough for just about every fab customer in the world, save Apple (who is TSMC’s alpha customer), Intel (yes, Intel gets some of their cutting edge chips fabbed at TSMC), AMD, and a few others. Technical details here, assuming the difference between FinFET and GAAFET doesn’t make your eyes glaze over.
