If there is a contest for the most powerful company on the planet, TSMC could be it. TSMC (or Taiwan Semiconductor Manufacturing Company) is the world’s largest semiconductor manufacturer and at the cutting edge it is almost a monopoly. Given the ubiquity and importance of semiconductors of our day to day lives, TSMC does acquire immense significance for humanity. Especially, in the context of the geo-political threat from across the strait from China, its importance in any scenario of future world order is more than just strategic. Yet, not many of us know much about the company – its history, its people, its culture and its wonderful factories that make these tiny yet powerful chips that go into systems ranging from nuclear weapons to iPhones. In this rather long yet engaging essay, Virginia Heffernan, takes us through her visit to TSMCs’ factory, reinforcing the strategically important context of the company along the way.
By revenue, TSMC is the largest semiconductor company in the world. In 2020 it quietly joined the world’s 10 most valuable companies. It’s now bigger than Meta and Exxon. The company also has the world’s biggest logic chip manufacturing capacity and produces, by one analysis, a staggering 92 percent of the world’s most avant-garde chips—the ones inside the nuclear weapons, planes, submarines, and hypersonic missiles on which the international balance of hard power is predicated.
Perhaps more to the point, TSMC makes a third of all the world’s silicon chips, notably the ones in iPhones and Macs. Every six months, just one of TSMC’s 13 foundries—the redoubtable Fab 18 in Tainan—carves and etches a quintillion transistors for Apple. In the form of these miniature masterpieces, which sit atop microchips, the semiconductor industry churns out more objects in a year than have ever been produced in all the other factories in all the other industries in the history of the world.”
…SEMICONDUCTOR FABRICATION PLANTS, known as fabs, are among civilization’s great marvels. The silicon microchips fashioned inside them are the sine qua non of the built world, so essential to human life that they’re often treated as basic goods, commodities. They’re certainly commodities in the medieval sense: amenities, conveniences, comforts. In the late ’80s, some investors even experimented in trading them on futures markets.
But unlike copper and alfalfa, chips aren’t raw materials. Perhaps they’re currency, the coin of the global realm, denominated in units of processing power. Indeed, just as esoteric symbols transform banal cotton-linen patches into dollar bills, cryptic latticework layered onto morsels of common silicon—using printmaking techniques remarkably similar to the ones that mint paper money—turns nearly valueless material into the building blocks of value itself. This is what happens at TSMC.
Like money, silicon chips are both densely material and the engine of nearly all modern abstraction, from laws to concepts to cognition itself. And the power relations and global economy of semiconductor chips can turn as mind-boggling as cryptocurrency markets and derivative securities. Or as certain theologies, ones that feature nano-angels dancing on nano-pins.
…TSMC’s success is built on its singular comprehension of this dispersion of providential gifts. The firm is merrily known as “pure play,” meaning all it does is produce bespoke chips for customer companies. These include fabless semiconductor firms like Marvell, AMD, MediaTek, and Broadcom, and fabless consumer-electronics firms like Apple and Nvidia. In turn, TSMC relies on the gifts of other countries. Companies like Sumco, in Japan, process polycrystalline silicon sand, which is quarried for the world’s semiconductor companies in places like Brazil, France, and the Appalachian Mountains in the US, to grow hot single-crystal silicon ingots. With diamond wire saws, Sumco’s machines slice shimmering wafers that, polished so smooth they feel like nothing under a fingertip, are the flattest objects in the world. From these wafers, which are up to a foot in diameter, TSMC’s automated machines, many of which are built by the Dutch photolithography firm ASML, etch billions of transistors onto each chip-sized portion; the biggest wafers yield hundreds of chips. Each transistor is about 1,000 times smaller than is visible to the naked eye.”
With that context, the author sets out to help us discover what makes TSMC special. Marcellus launched its Global Compounders Portfolio last month with one of its portfolio companies being ASML, the Dutch monopoly in lithography, a process that is crucial to TSMC’s chips becoming tinier than ever. No two companies together have been as important to humanity as TSMC and ASML.

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