The keynote for the 2023 Apple Worldwide Developers Conference (WWDC) is set to be held on June 5, 10:00 am PT. However, with the presentation less than a month away, Apple has been making moves and has seemingly shown its cards. What is Apple trying to achieve?
In the two decades between 2000 and 2020, Taiwanese firms did business in China rarely in collaboration with one another. For the manufacturing of notebooks and handsets, whoever managed to obtain the orders at the expense of competitors would emerge as the winner. It was a zero-sum game. Therefore, the stock market would favor those who were in the Apple supply chain. And any proposal for inter-company cooperation would usually be seen as something with a hidden agenda.
Bill Gates once said if Microsoft was rid of 20 of its best talents, it would be only a company of mediocrity. Which countries would be able to recruit 20 top-notch experts who could help develop their home-grown semiconductor industries? The US and Japan had a head start, while Taiwan and Korea were presented with the opportunities at some critical moments in history. Who would be the next pretender to the pinnacle of the semiconductor industry?
India's PLI scheme encourages local companies to team up with makers from Taiwan and South Korea, and it has helped local companies forge partnerships with Wistron, Pegatron and Foxconn. The Asian ICT supply chain, which has played second fiddle to big US companies for three decades, is being presented with new opportunities by the emerging markets in Asia and the changing supply-demand structure. If they seize the business opportunities in ASEAN and South Asia, their partnerships with local companies may be able to reshape their corporate strategies and cycles.
The rising labor cost in China and the changing international politics have given birth to a new value chain stretching from Shenzhen and Dongguan in southern China to northern Vietnam. Samsung has already established two major handset production bases in northern Vietnam. Vietnam, with double-digit growth in electronic device exports annually in recent years, promises to be a key player in the supply chain.
According to data collected by DIGITIMES, all 949 publicly traded electronics firms in Taiwan generated sales totaling NT$953 billion in 2022. Manufacturers of electronic devices, such as handsets and notebooks, accounted for about NT$500 billion, of which about NT$400 billion came from the top-6 makers – Foxconn, Pegatron, Quanta, Wistron, Compal, and Inventec. These six firms alone purchase as much as US$300 billion worth of components each year, and if they stopped production at the same time, the impact would be immeasurable. The US bid to rebuild meaningful control of the supply chain has definitely sent shockwaves across the ecosystems supporting these top-6 makers.
I've just finished reading Richard Bush's book, "Difficult Choices: Taiwan's Quest for Security and the Good Life." Bush is a Taiwan expert, and his book offers a lot of insights into and fair discussions about Taiwan's predicaments. It points out how politicians from both the ruling and main opposition parties were biased when debating the pros and cons of the stipend reform and the nuclear energy policy. They put partisanship over public interests. Taiwanese know such issues well, but they seldom read what foreign experts write, believing that they have hidden agendas. Bush also makes insightful observations about Taiwan's lack of talent.
As DIGITIMES marks its 25th anniversary, we are humbled by what the pioneers have achieved in the development of the electronics industry over the last half a century. I've often described Amazon as an AI big data firm that's packaged as a retailer. And now it is trying to migrate from the computing cloud to the AI cloud. DIGITIMES is a dedicated IT industry information provider that happens to be packaged as a media outlet. These packages change with the times and tech developments.
I recently visited former ITRI president Chintay Shih in Hsinchu. Shih said he joined ITRI in 1973, and the next year he took part in the RCA semiconductor program. That was half a century ago. He said he worked his way up to become president of ITIR before retiring 20 years ago. And since then, he has been teaching at National Tsing Hua University (NTUH). Over the past five decades he has been focused on semiconductors in two different job positions. He must be very happy that the semiconductor industry has been thriving. For him, has that been the best career choice?
Himax CEO Jordan Wu noted at a forum concerning Taiwan's IC design that many Taiwanese IC design houses have been able to achieve profitability. But despite the profits, they are still striving to secure government support or even trying to influence the government's policies. Why is that so? Wu pointed out that IC design is a knowledge-intensive sector that attracts global attention. Policies concerning IC design are unlike those for most other industry sectors and their making must take international competition into consideration.
The semiconductor industry has taken root in Taiwan in ways that people would not have dreamed of half a century ago. The 1970s marked a decade of turmoil for Taiwan when it had to quit the UN and then sever diplomatic ties with the US and Japan. Its industries relied on the cheap yet high quality labor of the export processing zones (EPZ). MediaTek chairman M. K. Tsai was employed at an export processing zone before joining RCA's program. The founder of LiteOn, the first Taiwanese firm that made diodes and the first electronics firm in Taiwan that went public, also had worked at an EPZ. They were leaders and witnesses of the development of Taiwan's industry at such difficult times.
Today marks DIGITIMES' silver jubilee, its quadranscentennial anniversary since its founding. To celebrate this wondrous occasion, our buoyant junior editorial staff has opportunely submitted that a documentary film be made, by borrowing the colourful palette of seasonal Chinese Solar Terms as allegories, as depicted in The Classic of Rites (Liji), Proceedings of Governments in Different Months (Yueling), one of the many distinguishing gems of our Confucian cultural heritage, specifically the Rousing of Hibernating Insects (Qizhi), Advent of Rainbows (Jianhong), Bourgeoning Signs of Creation (Xiusheng), Subsiding of Thunderous Rumble (Shishou), Northward Voyage of Anseres (Yanxiang), to recount Taiwan's tech industry's evolutionary passage to date.
The global semiconductor market reached US$575.1 billion in 2022, but the figure only covers the IC design and IDM sectors. The entire semiconductor value chain should come close to US$1 trillion if all the other sectors in the ecosystem, including wafer foundry, packaging, testing, equipment, materials and EDA/IP, are taken into consideration. In terms of the market, Taiwan accounted for only 8%. But in terms of the entire value chain, Taiwan had an over 17% share. And Taiwan leads anyone else in the world in advanced chip manufacturing processes; this is what makes Taiwan a global semiconductor powerhouse next only to the US.
