In a recent discussion about the competitive landscape in the semiconductor industry, Arm’s CEO, Rene Haas, shared his insights on Intel’s struggles against TSMC. His remarks highlighted several critical areas where Intel has fallen short, particularly in the context of missed opportunities and strategic decisions.
Rene Haas on Intel’s Challenges with Late EUV Adoption and Market Trends
The ongoing conversation regarding Intel’s capacity to rival TSMC has intensified recently, spurred by significant investments from the Trump administration and NVIDIA. The central concern revolves around whether Intel can serve as a viable alternative to TSMC, especially given the potential supply chain vulnerabilities facing the Taiwanese giant. During an episode of the All In Podcast, Haas underscored Intel’s various setbacks, indicating that the company has “suffered”in key sectors, making recovery increasingly challenging.
It takes a long time to invest in fabs. It takes a long time to define architectures and ecosystems. If you miss a few, time is very, very, you will be punished for that.
And I think Intel has unfortunately been punished on a few areas. They were punished on mobile, obviously. They missed that completely. Once you fall behind in chips, it’s very, very difficult to catch up because the cycle gets on top of you. TSMC now has the best fabs in the world. The leading-edge companies, Apple, NVIDIA, AMD, they all build at TSMC.
Haas pointed out that one of Intel’s critical missteps was its neglect of the burgeoning mobile chip market. This decision is notably relevant to Intel’s absence in the mid-2000s when the company had the opportunity to produce low-power chips for the iPhone. Instead of pursuing this promising segment, Intel retained its focus on consumer CPUs. In hindsight, former CEO Paul Otellini acknowledged this miscalculation as one of the company’s most significant mistakes.
The CEO of Arm also critiqued Intel’s delayed adoption of Extreme Ultraviolet (EUV) lithography, a topic that bears significant relevance in the current technological landscape. According to Haas, Intel’s hesitance to invest in EUV technology allowed TSMC to lead the pack in advanced chip production.
They were also punished in terms of manufacturing of going to EUV. EUV is an advanced methodology for building the smallest chips on the planet. They decided not to invest in that probably a decade ago at the rate that TSMC did, and they fell behind.
The essential takeaway from Haas’s statements is that in the fast-paced semiconductor industry, being late to adopt new technologies can have enduring consequences. For Intel to position itself as a contender against TSMC, it must significantly enhance its foundry capabilities and innovate more effectively. Additionally, Haas highlighted a cultural discrepancy between the perception of manufacturing jobs in the U. S.and Taiwan, where working for TSMC is viewed as a prestigious career path, unlike in the U. S., where manufacturing roles are often undervalued.
I don’t know that we have it now, and we certainly haven’t trained a generation of folks to look at manufacturing jobs as being something that is as lucrative and prestigious. They’re sort of thinking, oh, it’s a blue-collar job, I don’t want to go into that way. It’s not viewed that way in Taiwan, right? And in Taiwan, if you say you’re working for TSMC, you’re studying to go up and do that, it’s a highly prestigious kind of thing.
To address these challenges, it is crucial for the United States to initiate a comprehensive overhaul of its domestic manufacturing sector. This crucial transformation extends beyond Intel alone; it encompasses a systemic effort across multiple industries requiring long-term strategic support from policymakers.
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