Heavy is the head that wears the semiconductor crown
Just 10 days ago, I noted that taiwan Semiconductor Manufacturing Co.’s (TSMC) earnings and outlook served as proof that it’s truly the global king of chips. Since then, the company has grown even stronger, but more good news also increases the burden and will likely draw far more attention than it’s comfortable with.
After decades behind the scenes, TSMC is taking an everbigger share of the spotlight as one of the most famous and powerful technology companies in the world. So far, it’s managed to outsmart competitors, skirt antitrust regulators, and survive early rounds of the Washington-beijing chill. This may make it a hero to investors and the ruler of its sector, but also creates a huge target.
The company told investors in 2017 that it was under preliminary investigation by the European Commission “concerning alleged anti-competitive practices…in relation to semiconductor sales.” The implication was that Tsmc—holding more than 50 percent of the global contract-manufacturing market—is too big and powerful, with reports at the time suggesting that the US Fair Trade Commission was also taking a look. While it seems both probes are on hold, there’s every chance that either could be dusted off and restarted should concerns increase.
The company has only grown bigger since, and become an unwilling player in the Us-china tech cold war. It has sought to ease concerns that so much American semiconductor prowess and supply sits offshore by announcing that it will build a factory in Arizona. Former Intel executive Peter Cleveland and US Chamber of Commerce policy director nicholas Montella have been hired to beef up its US lobbying team.
After decades behind the scenes, TSMC is taking an ever-bigger share of the spotlight as one of the most famous and powerful technology companies in the world. So far, it’s managed to outsmart competitors, skirt antitrust regulators, and survive early rounds of the Washington-beijing chill. This may make it a hero to investors and the ruler of its sector, but also creates a huge target.