Intel Viewed as “Nobody” by Former TSMC co-COO, Advocates for Merger with Established Chip Technology Companies

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Veteran Insights: Intel’s Struggles and TSMC’s Dominance

Chiang Shang-yi, the former co-chief operating officer of TSMC, openly discussed Intel’s ongoing challenges in chip manufacturing during a recent event in Taiwan. Chiang, a pivotal figure at TSMC until 2013, played a significant role in establishing the company as a leader in global contract chip manufacturing. At a book launch, he shared crucial insights, stressing that Intel may need to pivot toward mature chip manufacturing technologies to regain relevance in a market where it currently trails TSMC.

Current Landscape: Intel’s Objectives Under New Leadership

As Intel’s new CEO, Lip-Bu Tan, begins his tenure, the company is focusing on two main objectives: achieving regular production of its 18A chip manufacturing node and building a competitive foundry business. These goals are designed to position Intel more competitively against TSMC. However, achieving parity in manufacturing nodes remains a critical challenge, especially as TSMC gears up to launch its comparable 2-nanometer process in the near future.

Strategic Recommendations from Industry Experts

During the event, Chiang strongly recommended that Intel redirect its efforts towards mature manufacturing processes. He highlighted the unique advantages TSMC possesses, which may be difficult for Intel to replicate. Specifically, he suggested that Intel should consider acquiring a plant capable of mass-producing mature chips rather than competing in high-end nodes where TSMC excels.

Intel CEO Lip-Bu Tan. Image: Intel Corporation

A Shift in Chip Manufacturing Hierarchy

Reflecting on his tenure at TSMC, Chiang reminisced about a time when Intel was the frontrunner in global chip manufacturing technology, while TSMC had to innovate rapidly to stay competitive. He advised that instead of continuing to chase high-performance node developments, Intel should merge with companies focused on producing mature chips. Although he refrained from naming specific firms, he noted that Taiwan’s UMC (United Microelectronics Corporation) and GlobalFoundries in America are prominent players in mature chip production.

TSMC’s Competitive Edge: Customer Diversification and R&D Focus

Chiang pointed out that TSMC’s vast customer base is a significant competitive advantage, enabling the company to maintain high output and rapid manufacturing capabilities. This strategic positioning allows TSMC to serve numerous clients effectively, solidifying its market leadership.

He also emphasized that TSMC’s commitment to research and development sets it apart from competitors like UMC. While UMC has partnered with IBM for research, TSMC has focused on self-developing its technological capabilities. Chiang expressed pride in witnessing TSMC overcome Intel’s previous dominance during his career.

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