Why the U.S. is in a bad position to import advanced logic chip technology from TSMC, the Chinese Embassy, and the ASML
The point is that if we push the boundaries of physics and materials science to cram more transistors onto a chip, it will make it less likely that one company will be able to excel at all parts of the design and manufacturing. You need the entire coalition. Every member of the coalition trusts TSMC because of its intimate trade secrets which it then melds and uses for the benefit of the whole.
Beijing wants to replicate the world’s all-star manufacturing chip stack on its own with old technologies because it does not trust the coalition partners not to steal their intellectual property. It managed to pilfer a certain amount of chip technology, including 28 nanometer technology from TSMC back in 2017.
Secretary of Commerce Gina Raimondo is in charge of both the new export controls on chips and the $51.7 billion worth of support the Biden administration just secured to bring advanced chip manufacturing back to the U.
She told me that the U.S. was in a bad position. The advanced logic chips that we are buying today are from abroad, 90 percent of which are from TSMC in Taiwan. It is true, but that is pretty crazy.
While these rules are being finalized ASML will continue to inform authorities about the impact of proposed rules in order to assess the effect on the global Semiconductor supply chain.
ASML is well known for making machines that print with light. The mass production of chips is important to the firm.
ASML, Fujian, and Tokyo Electron: How the US Trade Agreement for High-Performance Silicon Chips Made in the USA Was Not Declared
A deal was reached at the White House on Friday, though it was not officially announced, partly due to “concerns by Japan and Netherlands about potential retaliation by China,” according to the Journal, which cited a person familiar with the matter.
Bloomberg reported that the deal “would extend some export controls the US adopted in October” to Dutch and Japanese companies, including ASML
(NINOY) and Tokyo Electron.
The Netherlands faced pressure from the US to limit chip exports to China particularly from ASML according to Xiaomeng Lu, director of the Eurasia Group.
Asked about the three-way talks in Washington, Nishimura said “we would like to respond appropriately while taking into consideration the regulatory trends in each country.”
ASML is seen as a bellwether in the growing dispute between China and the West over access to advanced technology due to its dominance in the market.
The company said in its statement on Friday that it did not expect anymaterial impact on its projections for the next five years.
Those machines had been prohibited from being sent to China because the Dutch government had “refused to grant it a license under US pressure,” Lu previously told CNN.
The Dutch government was asked to restrict the export of ASML to China by President Joe Biden while he was there a few weeks ago. The only company in the world that makes a machine that is needed to make the most advanced chips is ASML. Apple couldn’t make iPhone chips without this one machine from the Netherlands’ biggest company. ASML has a large influence on the entire world economy. How did that happen?
Chris Miller, Tufts professor and author of Chip War: The Fight For The World’s Most Critical Technology walked me through a lot of this, along with some deep dives into geopolitics and the absolutely fascinating chip manufacturing process. This one has everything: foreign policy, high-powered lasers, hotshot executives, monopolies, the fundamental limits of physics, and, of course, Texas. Here we go.
So first, what is this? If you want to make patterns on silicon wafers, you do so by shining light through masks. You can get a pattern in a miniature version on a chip if you use the masks to block light in certain areas. Advanced chips today have millions, or often billions, of tiny circuits carved into them. They are often the size of a virus or even smaller, so you really need ultra-precise carbon capabilities. Ultra small light, which is better known as light less than 13 nanometers, is the wavelength of EUV’s light. The circuits you’re carving are very, very small and often only measure a few nanometers in diameter. Producing this type of light is really hard because it’s right next to the X-ray spectrum. It is difficult to make it and it is also difficult to make mirrors to reflect it.
The process works here. A ball of tin falls at a rate of several hundred miles an hour through a vacuum and measures around 30 millionths of a meter in diameter. It is pulverized by two shots from one of the most powerful lasers ever deployed in a commercial device and explodes into a plasma measuring several times hotter than the surface of the Sun — that is, several hundred thousand degrees Fahrenheit. A series of about a dozen mirrors captures the EUV light at a wavelength of 13.5 nanometers, which is the right wavelength for us. The mirrors reflect the light in order to hit a Silicon wafer and make the circuits that make your phone possible.
TSMC has to buy this machine from ASML, which has to assemble all these components from the flattest mirrors ever produced to the most powerful lasers ever deployed in a commercial setting to balls of tin. The balls of tin are not hard to find. It must make a machine and sell it to TSMC, which will use it to make chips for the iPhone. Does ASML just wash its hands of this machine when it sells it to TSMC? It sounds like it’s very complicated to operate.
Yes. ASML sells to customers all over the world — except in China, which we can discuss — but there are only a couple of companies that can really plausibly use an EUV machine. TSMC,Samsung, Intel, and a couple of memory chip makers are also included. There are very few other potential customers out there because the price tag is so high and the level of precision manufacturing skill needed to actually make use of them is really so niche and unique that ASML knows it will only ever have a customer base measuring a half dozen or maybe, at most, a dozen firms.
An EUV tool can be used without knowing how to use it, but a PhD in electrical engineering or material science takes 30 years to learn how to harness it
Yeah. Milwaukee or DeWalt do make good power tools, but they don’t make a good carpenter. Is that the vibe here — that you can buy the tool, but you have to actually know how to use it?
That is correct. It requires a PhD in electrical engineering or material science as well as years of working with the tools to know how to use it. The process of developing an EUV tool took 30 years. That just gives you a sense of the scale of precision that was needed to actually harness it.
ASML, one of the biggest suppliers to the global semiconductor industry, revealed that a former employee in China stole information about its proprietary technology. Within its recently published 2022 annual report, the Dutch tech firm said it had discovered “unauthorized misappropriation of data” that was promptly investigated in an internal review.
Based on its initial findings, ASML doesn’t believe that the misappropriated data will be detrimental to its ongoing business but acknowledges that some “export control regulations” may have been violated. The data breach has since been reported to the relevant authorities, and ASML is “implementing additional remedial measures in light of this incident.”