Chip War

• Semiconductors' Centrality: The book opens by stressing that nearly every aspect of modern technology—phones, computers, cars, military weapons—relies on tiny silicon chips powered by billions of transistors. ^{[y6r47f] [f1y89f]} *
• Historical Roots and Evolution:
  • The narrative starts during WWII, charting the birth and explosive growth of the chip industry.
  • The US initially dominated, spurred by defense needs—the Department of Defense once bought the majority of all integrated circuits produced. ^[mlrpo1]
  • By the Vietnam and Gulf Wars, semiconductors had revolutionized military power, making modern warfare heavily reliant on precision computing and guided munitions. ^{[mlrpo1] [y6r47f]}
• Global Competition:
  • While American firms led early innovation, by the 1980s, Japan challenged US dominance through superior manufacturing quality, especially in DRAM memory chips. ^[8auajm]
  • Taiwan’s TSMC became the sole manufacturer of the world's most advanced processors, supplying a huge share of global computing power. ^[f1y89f]
  • ASML (Netherlands) controls all supply of the lithography equipment needed to make state-of-the-art chips. ^[f1y89f]
• Offshoring and Vulnerabilities:
  • To keep costs low, US companies built complex global supply chains, concentrating critical steps (like advanced manufacturing) in East Asia. ^[f1y89f]
  • This offshoring has made the US and global economy vulnerable to supply chain shocks and geopolitical risks.
• China’s Challenge and New Tech Cold War:
  • China invests massively in chip technology to reduce reliance on US and foreign suppliers, recognizing semiconductors’ strategic value for economic and military competitiveness. ^{[y6r47f] [f1y89f]}
  • The struggle over chips is now a central front in the US-China rivalry, with export controls and industrial policies shaping the future. ^[y6r47f]
  • A hypothetical scenario in the book imagines how a military confrontation over Taiwan could cripple global chip supply, highlighting the stakes involved. ^[mlrpo1]
• Enormous Barriers to Entry:
  • Building a modern chip fabrication plant now costs over $20 billion and the technology becomes obsolete in just a few years. ^[y6r47f]
  • Every day, more transistors are produced than cells in the human body, underscoring both the complexity and scale of the industry. ^[y6r47f]
• Key Figures:
  • The book profiles industry pioneers such as Morris Chang (TSMC), Akio Morita (Sony), and leaders from Intel, Samsung, and others, showing how personalities shaped corporate and national strategies. ^[f1y89f]

Citations