21 blackjack

 

21 

blackjack

21 (film)

you are given 2 cards,

get as close to 21 without going over,

going over 21 is called, a bust, or busting

getting an Ace, and a (Jack, Queen, or King) card, is equal to 21, or blackjack

Ace is count as 11 or 1

Blackjack has a history and a future

The cards that have been dealt absolutely influences the card that will be dealt

the plus 1/minus 1 balance system

card 2-6 are given the value of +1

card 7-9 are given the value of 0, they are neutral

card 10, face cards, and Ace are given the value of -1, 

how many cards are left in the shoe?

when the count is high

when the count is low, you are likely to bust

over the long run, the count goes up and down

my answer is based on statistics, based on variable change

people always remember, if you don't know,

always account for variable change

   ____________________________________

Philip Tetlock

 

https://en.wikipedia.org/wiki/Philip_E._Tetlock

You can go to the original (textise.net) URL

https://www.textise.net/showText.aspx?strURL=https://medium.com/conversations-with-tyler/philip-tetlock-tyler-cowen-forecasting-sociology-30401464b6d9

or read my copy, cut & paste

Philip E. Tetlock on Forecasting and Foraging as a Fox (Ep. 93)

Mercatus Center

Apr 22, 2020 · 37 min read

     ••••   •••   •••• 

IARPA original forecasting tournaments with geopolitical events, like how long the Syrian Civil War would last, or what would Russia do in Eastern Ukraine, or things of that sort 

     ••••   •••   •••• 

TETLOCK: I don’t think so. I don’t think I have the patience or the temperament for doing it. I did give it a try in the second year of the first set of forecasting tournaments back in 2012, and I monitored the aggregates. We had an aggregation algorithm that was performing very well at the time, and it was outperforming 99.8 percent of the forecasters from whom the composite was derived.

If I simply had predicted what the composite said at each point in time in that tournament, I would have been a super superforecaster. I would have been better than 99.8 percent of the superforecasters. So, even though I knew that it was unlikely that I could outperform the composite, I did research some questions where I thought the composite was excessively aggressive, and I tried to second guess it.

The net result of my efforts — instead of finishing in the top 0.02 percent or whatever, I think I finished in the middle of the superforecaster pack. That doesn’t mean I’m a superforecaster. It just means that when I tried to make a forecast better than the composite, I degraded the accuracy significantly.

     ••••   •••   •••• 

TETLOCK: I think you’d want an interdisciplinary team. Diversity is one of these words that’s been reduced to a cliché, but we have found in our work that cognitive diversity helps, and it helps in certain quite well-defined ways.

If you want to create a composite that out-predicts the vast majority of the superforecasters, a good way to do it is not only to take the most recent forecast of the best forecasters in the domain, but it’s also to extremize that forecast to the degree that people who normally disagree, agree with each other. And when you have convergence among diverse observers, that’s a signal that the weighted average composite is probably too conservative and you should extremize.

COWEN: Does the diverse team have a CEO, someone in charge?

TETLOCK: Not in this case, no. That’s done purely statistically.

     ••••   •••   •••• 

TETLOCK: That’s a matter of managerial skill, I would say. Going back to one of my old dissertation advisors at Yale, 40 plus years ago, Irv Janis on Groupthink, I would pick a leader who knows how to shut up, and not reveal opinions at the beginning of the meeting, and knows how to listen.

    I would pick a leader who knows how to shut up, and not reveal opinions at the beginning of the meeting, and knows how to listen.

     ••••   •••   •••• 

TETLOCK: I think a lot of good executives have the intuition that you get more out of a team of forecasters or problem solvers if you elicit independent judgments initially that are uncontaminated by conformity pressure, and then you create an environment in which ideas can be freely critiqued before lifting the veil of anonymity and letting people see who’s taking which positions.

     ••••   •••   •••• 

TETLOCK: IARPA just ran a forecasting tournament called Hybrid Forecasting Competition in which they pitted algorithmic approaches and human approaches and hybrid approaches against each other. I should let IARPA speak for itself about how well its programs work or don’t work.

I don’t think there’s a lot of evidence to support the claim that machine intelligence is well equipped to take on the sorts of problems that the intelligence community wanted to have answered when it runs the forecasting tournaments it’s been running with our research team.

The things like the Syrian Civil War, Russia/Ukraine, settlement on Mars — these are events for which base rates are elusive. It’s not like you’re screening credit card applicants for Visa. Machine intelligence is going to dominate human intelligence totally. Machine intelligence dominates humans in Go and Chess. It may not dominate humans in poker.

I don’t know that the state of the art is quite there yet, but it’s in their StarCraft or whatever the next thing that Dennis Hassabis is going to conquer. No, I don’t see evidence that those approaches work in the domains that we study with the intelligence community.

     ••••   •••   •••• 

COWEN: What if I say — again, current events aside — but it seems easier to predict. There hasn’t been a world war since 1945. There’s been steady economic growth in most parts of the world. More peace. Isn’t that easier to predict? You just predict 2 to 4 percent global economic growth and you pick up a fair amount of what’s happened since 1950.

TETLOCK: Indeed. So, simple extrapolation algorithms, historically, are hard to beat. We’re running a COVID-19 mini forecasting tournament right now, and they’re proving to be hard to beat. The skill, of course, is when to alter the trend, whether to accelerate it or decelerate it, or to change direction.

     ••••   •••   •••• 

TETLOCK: I think humans have been repeatedly humbled in competitions against simple statistical algorithms, going back to Paul Meehl’s famous little book on clinical versus actuarial approaches to predicting in medicine and psychiatry. So, I would say, “Be humble.”

COWEN: There’s some of your early research that, if I read it properly, suggests that making people accountable leads to more evasion and self-deception on their part. Are you worried that your work with pundits, by trying to make them more accountable, will lead to more evasion and self-deception from them? How do you square early Tetlock and mid-period-to-late Tetlock?

TETLOCK: [laughs] It’s actually not too difficult in that particular case. It really depends on the type of accountability. Tournaments create a very stark monistic type of accountability in which one thing and only one thing matters, and that is accuracy. You get no points for being an ideological cheerleader and pumping up the probabilities of things that your team wants to be true or downplaying the probabilities of the things your team doesn’t want to be true. You take a reputational hit. So the incentives are very unusually tightly aligned to favor accuracy.

That’s extremely unusual in the social world. Most forms of accountability occur in organizational settings in which there are lots of distortions at work. And the rational political response for a decision maker located in most accountability matrices and organizations is to engage in some mixture of strategic attitudes shifting toward the views of important others or, as you put it, evasion, procrastination, and so forth.

     ••••   •••   •••• 

TETLOCK: I don’t know if we can make them run much further away from objective standards than they already are. [laughs] But that’s a very interesting point about forecasting tournaments. I look at the kinds of people who are attracted to participate in them. At the very outset, I invited lots of big shots to participate in forecasting tournaments, and they’ve repeatedly turned me down.

I had a very interesting correspondence with William Safire in the 1980s about forecasting tournaments. We could talk a little about it later. The upshot of this is that young people who are upwardly mobile see forecasting tournaments as an opportunity to rise. Old people like me and aging baby-boomer types who occupy relatively high status inside organizations see forecasting tournaments as a way to lose.

If I’m a senior analyst inside an intelligence agency, and say I’m on the National Intelligence Council, and I’m an expert on China and the go-to guy for the president on China, and some upstart R&D operation called IARPA says, “Hey, we’re going to run these forecasting tournaments in which we assess how well the analytic community can put probabilities on what Xi Jinping is going to do next.”

And I’ll be on a level playing field, competing against 25-year-olds, and I’m a 65-year-old, how am I likely to react to this proposal, to this new method of doing business? It doesn’t take a lot of empathy or bureaucratic imagination to suppose I’m going to try to nix this thing.

     ••••   •••   •••• 

TETLOCK: Well, I think that particular measure in integrative complexity does have some correlation with forecasting accuracy.

But I think you’re picking up something more than just forecasting accuracy. You’re picking up what I call value pluralism. You’re picking up a tendency to endorse values that are often in conflict with each other. So the more frequently that you, as a political thinker, confront cognitive dissonance between your values, your value orientations, the more pressured you are to engage in integratively complex synthetic thinking.

When your values are more lopsided, it’s easier to engage in what we call simpler modes of cognitive dissonance reduction, like denial or bolstering and spreading of the alternatives. So downplay one value, push up the other value, and make your life stress-free.

But some ideological positions at some points in history require more tolerance for dissonance and some people are more inclined to fill those roles.

     ••••   •••   •••• 

TETLOCK: We’re not talking about huge effect sizes here or integrative complexity. I think that fluid intelligence is probably a more powerful predictor. A combination of fluid intelligence and integrative complexity, I think, does boost up forecasting accuracy, yes.

     ••••   •••   •••• 

TETLOCK: Well, that is supposed to be the division of labor here. I think one reason they may be interested in forecasting tournaments is because forecasting tournaments incentivize people to do one thing and only one thing, and that’s accuracy. You don’t get points for skewing your judgements toward your favorite cause. You take a hit in the long term by doing that.

     ••••   •••   •••• 

TETLOCK: Whoa, boy! [laughs] Well, there’s a long history to efforts to reform the CIA. It was founded in 1947, and there have been various efforts since then. People have been unhappy with the CIA for many reasons over time, Vietnam being a big one. But there are lots of other reasons that people have expressed unhappiness. Both liberals and conservatives have, at various points, been unhappy with the performance of the intelligence community.

In 2001, it came to a crisis point, I think, and then there was a commission to reform intelligence analysis. After the WMD fiasco in Iraq, the pressure grew even more. One reason why we’re even talking right now today, is that the intelligence community was forced, essentially by the recommendations of the reform commission, to take keeping score more seriously, to take training for accuracy and monitoring of accuracy more seriously.

That’s when they created the Intelligence Advanced Research Projects Activity, which is the R&D branch housed within the Office of the Director of National Intelligence. Its job is to support innovative research that will improve the quality of intelligence analysis. That can be defined in various ways, but accuracy is certainly one very important component of that. But it’s not accuracy with a liberal skew or a conservative skew. It’s supposed to be just plain, “just the facts, ma’am” accuracy.

     ••••   •••   •••• 

TETLOCK: That’s a very difficult question because of the tail risk aspect to it. If you look at the number of people who’ve died from terrorism versus other causes, it would seem that the amount of money we spend on suppressing terrorism would be disproportionate. But the tail risk complicates that a lot.

     ••••   •••   •••• 

COWEN: On historical counterfactuals, by what year do you think the ascent of the West was more or less inevitable?

TETLOCK: Well, I have inside information here. We did a survey of some very prominent historians. We reported it in that book, Unmaking the West. We put a part of it anyway, also in an article in American Political Science Review. If you looked at just the unweighted average of judgments from the median, I think was probably around 1730, 1740.

     ••••   •••   •••• 

TETLOCK: That’s a good example actually, of why I’m not a superforecaster. I don’t play Civilization V. But Civilization V was one of the simulations that IARPA chose to feature in its counterfactual forecasting tournaments under the rubric of FOCUS. And if any of your listeners are interested in signing up to be forecasters for FOCUS. We still have one more round, round 5, and we will be recruiting people.

But again, you see, it reflects my temperament. I don’t have the patience for a game like Civ V. Forecasting is inevitably a mixture of fluid and crystallized intelligence, and you have to invest a lot of energy into mastering a game like Civilization V. And I suppose, as people get older, they may become less likely to make those kinds of cognitive investments. It becomes more and more essential as I get older, I think, to focus on the things where I have a real comparative advantage.

     ••••   •••   •••• 

COWEN: The best chess players are all young, right? This we know. There’s clear data.

TETLOCK: Well, yeah. It’s interesting the domains in which child prodigies emerge: music and chess and math.

     ••••   •••   •••• 

But you can’t rerun history. So that makes counterfactuals a place where ideologues can retreat. They can make up the data, make up whatever facts they want to justify pretty much whatever. No matter how bad the war in Iraq went, you can always argue that things would have been worse if Saddam Hussein had remained in power. So you have these factual and counterfactual reference points that people use in debates implicitly to make rhetorical points.

Part of what attracted to me to counterfactuals was (A) how important they are in drawing any lessons from history, (B) how important they are in policy arguments, and © how unresolvable they are.

One of the things we’re hoping to do in the FOCUS program is to develop some objective metrics for identifying people and methods of generating probabilities that produce superior counterfactual forecasts in simulated worlds in which you can rerun history and assess what the probability distributions of possible wars are. Well, it turns out, you get World War I 37 percent of the time even if you undo the assassination of the archduke. And you get something like World War II . . . You see where we’re going.

So we’re hoping that one result of FOCUS will be to help us identify people and methods that generate superior counterfactual forecasts in domains where there is a ground truth. The next task will be to connect superior performance in simulated worlds to superior performance in the actual world.

And this is where things get tricky, of course, because in the actual world, we don’t have the ground truth. So if I ask you a counterfactual question of the form, if NATO hadn’t expanded eastward as far as it did in 2004 under the Baltics, NATO-Russia relations would be considerably friendlier than they are now.

     ••••   •••   •••• 

TETLOCK: But you can measure what people’s beliefs are in the counterfactual. And then you can measure people’s beliefs about conditional forecasts that are logically connected to the counterfactuals in a kind of a Bayesean entrance network. If I know that you think that the Russians would be every bit as nasty and snarly, even if we hadn’t moved into the Baltic — they might have even been nastier — it’s probably a fair bet that you’re also likely to think it’s a good idea to increase arm sales to the Ukraine, ratchet up sanctions on Putin’s cronies, and so forth.

So we can identify the counterfactual belief correlates to more or less accurate conditional forecasting. And in that sense, you can indirectly validate or invalidate, you can render more or less plausible certain counterfactual beliefs. That’s the longer-term objective of this research program. We’re not playing Civilization V for the sake of getting better at Civilization V. The ultimate goal is to link the sophistication of counterfactual reasoning about the past to the subtlety in the accuracy of conditional forecast going into the future.

Another thing you should observe by the way — if people are becoming better counterfactual reasoners, you should observe less ideological polarization in their counterfactual beliefs. The counterfactual belief should become as ideologically depolarized as conditional forecasts are.

     ••••   •••   •••• 

TETLOCK: Right, the question is, are they doing better because they have better social networks? Or they are doing better, they have better judgment?

     ••••   •••   •••• 

TETLOCK: It ties into accountability. Accountability to conflicting audiences and value pluralism. You have a richer internal dialogue. You learn to balance conflicting perspectives more. You have to be a better perspective taker. Perspective taking’s a very important part of superforecasting, too.

     ••••   •••   •••• 

Amy Gutmann, PIK, Penn Integrates Knowledge kind of program — you don’t see too many of them yet. It runs against the grain. I’m not even sure it’ll survive at Penn beyond Amy. The natural tendency will be for departments to want to claw back the resources.

     ••••   •••   •••• 

TETLOCK: Kind of obvious things, like read a little bit more outside your field. If you’re a liberal, read the Wall Street Journal. If you’re a conservative, read the New York Times. Expose yourself to dissonant points of view. Try to cultivate some interests outside your field, and try to connect them together. I think there’s an optimal distance.

For history, for example — sounds quite different from what I did. I started as an experimental psychologist, and history looks very different, but they can be connected because historical judgment is something that psychologists study to some degree. Psychologists are interested in hindsight and counterfactuals and so forth. So you can link the two.

I think there’s an optimal distance, and when you go foraging as a fox, you probably don’t want to forage way, way far away. You want to forage far enough away that it’ll be stimulating but still possible to reconnect.

     ••••   •••   •••• 

TETLOCK: Gosh, that’s a hard one. Danny Kahneman, I think, coined the term when he was dealing with his various critics over time. My wife, Barb, actually was involved in an adversarial collaboration between the Kahneman camp and the Gigerenzer camp on the conjunction fallacy. It took at least two or three years of her life.

It’s very hard to get people to . . . Well, lots of us, in principle, are Popperians. We believe in stating our beliefs as falsifiable hypotheses. Most of us believe our beliefs are probabilistic, so we’re somewhat Bayesian. But that’s lip service. There’s what we believe. There’s an epistemological formal self-concept, which is kind of noble, falsificationist, and probabilistic. And then there’s how we actually behave when our egos are at stake in particular controversies.

And those things are quite different. I think Danny Kahneman who’s not known as an optimist, proposed it. It sounds like an optimistic idea, but I think he’s not all that optimistic about what it can achieve on close inspection. My efforts at adversarial collaboration have not been all that successful. I’d like to jumpstart a few of them again, but it’s very hard to find the right dance partners.

     ••••   •••   •••• 

COWEN: Let’s try a question from the realm of the everyday and the mundane. If I go around, and I look at Mexican restaurants, I’m very good at predicting which ones have excellent tacos. What are you good at predicting?

TETLOCK: What am I good at predicting? I think I was pretty good at anticipating the fragility of a lot of microsocial science knowledge prior to the replication crisis erupting.

     ••••   •••   •••• 

TETLOCK: Well, I think the next project is the one that I mentioned earlier. It’s linking historical counterfactual reasoning with conditional forecasting. I think it’ll be the second phase of the FOCUS research tournaments. I think that counterfactual reasoning has, for too long, been the last refuge of ideological scoundrels. Insofar as we can improve the standards of evidence of proof in judging counterfactual claims as well as conditional forecasts and linking the two, I think there’s a potential for improving the quality of debates among interested parties.

     ••••   •••   •••• 

TETLOCK: Oh, to be very cautious because we know we’re running against the grain. We’re running against a psychological grain. We’re running against human nature. We’re running against a sociological grain.

COWEN: But see, enlightenment is stable you tell us, right? If it keeps on cumulating and growing, your influence should be enormous given your other presuppositions.

TETLOCK: Well, there’s a lot of cognitive resistance to treating one’s beliefs as falsifiable, probabilistic propositions. People naturally gravitate toward thinking of their beliefs as ego-defining, quasi-sacred possessions. That’s one major obstacle.

Then you have the existing status hierarchies. You have subject matter experts who are entrenched, have influence. Why would they want to participate in exercises in which the best possible outcome is a tie? They reaffirm that they deserve the status that they already have.

So psychological, sociological resistance. It’s interesting, sociologists and economists have different reactions to forecasting tournaments. Sociologists — they react, “Why would anyone be naive enough to think that anyone would want to have a forecasting tournament in their organization?” They’re status disruptive, right?

     ••••   •••   •••• 

source:

https://www.textise.net/showText.aspx?strURL=https://medium.com/conversations-with-tyler/philip-tetlock-tyler-cowen-forecasting-sociology-30401464b6d9

  <---------------------------------------------------------------------------->

[personal note]

How I got here:

youtube.com

one of youtube auto recommend algorithm (they are no longer label as "recommend") the youtube video just show up on your queue (feed).

([ obviously it was some thing I watched or a sequence of things I watched on you tube that cause the recommendation algorithm to put the video in my viewing queue; unless there was human intervention, which is unlikely; the algorithm is made (program and code) by humans ]) 

so I watched Eric Schmidt being interviewed by Reid Hoffman, and one of the thing that was mentioned was the book, How Google Works, by Eric Schmidt

I got the book How Google Works from the local library; fortunately, the book has been out long enough that the library got a copy and no one is using it. 

I read it and notice the name, Philip Tetlock; somehow the name feels familiar.

I bing search Philip Tetlock.

Philip E. Tetlock on forecasting and foraging as a fox (Ep. 93) 

Apr 22, 2020

https://medium.com/conversations-with-tyler/philip-tetlock-tyler-cowen-forecasting-sociology-30401464b6d9

  <---------------------------------------------------------------------------->

[skip]

In a 1985 essay, Tetlock proposed that accountability is a key concept for linking the individual levels of analysis to the social-system levels of analysis.[12] Accountability binds people to collectivities by specifying who must answer to whom, for what, and under what ground rules.[12][13] In his earlier work in this area, he showed that some forms of accountability can make humans more thoughtful and constructively self-critical (reducing the likelihood of biases or errors), whereas other forms of accountability can make us more rigid and defensive (mobilizing mental effort to defend previous positions and to criticize critics).[14]  In a 2009 essay, Tetlock argues that much is still unknown about how psychologically deep the effects of accountability run—for instance, whether it is or is not possible to check automatic or implicit association-based biases,[15] a topic with legal implications for companies in employment discrimination class actions.[16]

In addition to his work on the bias-attenuating versus bias-amplifying effects of accountability, Tetlock has explored the political dimensions of accountability. When, for instance, do liberals and conservatives diverge in the preferences for "process accountability" that holds people responsible for respecting rules versus "outcome accountability" that holds people accountable for bottom-line results?[17][18] 

Taboo cognition and sacred values

Rather, humans prefer to believe that they have sacred values that provide firm foundations for their moral-political opinions. People can become very punitive "intuitive prosecutors" when they feel sacred values have been seriously violated, going well beyond the range of socially acceptable forms of punishment when given chances to do so covertly.[28]

Experimental political philosophy

Tetlock argues it is virtually impossible to disentangle the factual assumptions that people are making about human beings from the value judgments people are making about end-state goals, such as equality and efficiency.[43][44][45][46][47] Hypothetical society studies make it possible for social scientists to disentangle these otherwise hopelessly confounded influences on public policy preferences. 

source:

       https://en.wikipedia.org/wiki/Philip_E._Tetlock

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Bruce Bueno de Mesquita

If you are interested in works like Philip Tetlock, you should look into Bruce Bueno de Mesquita.  He also has a wikipedia page.

https://en.wikipedia.org/wiki/Bruce_Bueno_de_Mesquita

Here are some URLs about his works: 

(as of Fri, Jun 18, 2021 the pages are [UP])

https://www.nytimes.com/2009/08/16/magazine/16Bruce-t.html

https://www.npr.org/templates/story/story.php?storyId=120201554

https://web.archive.org/web/20150930072215/http://magazine.good.is/articles/the-new-nostradamus

If you watch Bueno de Mesquita video below, he will tell you, that his method is based on game theory, that the method can be taught, that it is based on negotiation and manipulation (to influence the decision-maker), that it only works on people who are rational and are self-interest.  A two-year-old is not rational. 

Using game theory to model complex decision-making 

1:42:42

The Predictioneer's Game 

42:47 (start) 

https://youtu.be/XfE0ih-6fi8?t=2567

https://youtu.be/XfE0ih-6fi8?t=2567

44:00 (stop) 

https://www.youtube.com/watch?v=XfE0ih-6fi8

https://www.youtube.com/watch?v=XfE0ih-6fi8

NYUAD Institute

Published on Sep 15, 2015

The Predictioneer's Game 

December 9, 2009 

Bruce Bueno de Mesquita will discuss how applied game theory can be used to anticipate policy choices whether in business or in government. 

The Predictioneer's Game 

https://slideplayer.com/slide/4437069/

   ____________________________________

[backgrounder: Bruce Bueno de Mesquita]

Bruce Bueno de Mesquita: Stories of Research to Reality 

https://www.youtube.com/watch?v=jUPEUZy3UX8

https://www.youtube.com/watch?v=jUPEUZy3UX8

17:34

sage publishing

May 14, 2015

https://www.files.ethz.ch/isn/155084/Theory%20Talk31_BuenodeMesquita.pdf

     Course  taught  by  Donald Stokes.  I read and prepared an oral presentation on William Riker’s Theory of Political Coalitions for that course and  discovered that the strategic principle in that book was incorrectly derived.  This was my first exposure to formal modeling and the first time that I saw how rigorous logic (a formal model in this case) could be used to conclude that a claim was false, not as a matter of opinion but as a matter of straightforward logic. 

Finally, the chair of my Ph.D. committee ─ Richard L. Park ─ had a deep influence on my thinking and my approach to teaching.  He demonstrated a tolerance for a perspective different from his own that I found inspiring.  Dick Park was one of the founders of modern South Asian studies.  He found my rational choice and quantitative approach to Indian politics rather different from his own thinking but he encourage me, supported me, and nurtured the confidence that allowed me to go forward despite resistance from many other leading lights in the South Asia research community at the time.  One of my most satisfying academic experiences is having had the opportunity to co-author a book with him (India's Political system, 2nd edition) just before his untimely death. 

   ____________________________________

Bruce Bueno de Mesquita

“His ability to pick up on body language, to pick up on vocal intonation, to remember what people said and challenge them in nonthreatening ways — he’s a master at it,” says Rose McDermott, a political-science professor at Brown who has watched Bueno de Mesquita conduct interviews. She says she thinks his emotional intelligence, along with his ability to listen, is his true gift, not his mathematical smarts. “The thing is, he doesn’t think that’s his gift,” McDermott says. “He thinks it’s the model. I think the model is, I’m sure, brilliant. But lots of other people are good at math. His gift is in interviewing. I’ve said that flat out to him, and he’s said, ‘Well, anyone can do interviews.’ But they can’t.”

In his 1996 book, “Red Flag Over Hong Kong,” he predicted that the press in Hong Kong “will become largely a tool of the state” — a highly debatable claim today. (In 2006, Reporters Without Borders noted concerns about self-censorship but said that “journalists remain free in Hong Kong.”)

source:

       https://www.nytimes.com/2009/08/16/magazine/16Bruce-t.html

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p.5

The forecasting and policy engineering model I developed assumes that stakeholders on any policy issue care about two things: the outcome on the issue and the extent to which they are seen as instrumental in putting an agreement together (or blocking one).  The model specifies a rather simple game and solves the game, in the process estimating how much each stakeholder values the policy outcome relative to being seen as instrumental in shaping the outcome.  It also

estimates how each player perceives its relationship with each other player, what proposals players make to each other regarding resolution of the issue (including no proposal at all) on a round by round basis.  The model estimates how player positions change and also updates player estimates of the willingness of others to take risks.  It does quite a bit more as well.  This model depends on expert inputs based on an intensive interview process that elicits who the

stakeholders are who will try to influence an outcome, what outcome they currently argue for, how much persuasive clout they could bring to bear, and how salient the issue is to them compared to other issues on their plate.  Experts are not asked how they think the issue will be resolved and the model frequently disagrees with the conventional wisdom on what is likely to happen.

 - 2002 book Predicting Politics (ohio state university)

 - 1994 book (co-edited with Frans Stokman) European Community Decision Making (yale university press) 

 - 1997 article in International Interactions for explanations of how the model works. 

 - Stanley Feder's 2002 article in the Annual Review of Political Science 

source: Theory talk #31

        BRUCE BUENO DE MESQUITA ON GAME THEORY, PREDICTION AND FEAR OF LOGICS IN IR (International Relation) 

        filename: Theory Talk31_BuenodeMesquita.pdf

        http://www.theory-talks.org/2009/06/theory-talk-31.html

        (URL link was copy & past from pdf, unverified)  

www.theory-talks.org

   ____________________________________

p.14

If you look, for instance, at Jim Fearon’s work on rationalist explanations of war, you see that the reason of why wars occur, is not about ethnic, economic or other differences, but it’s rather about three elements, of which you have to have any one to get a war: 

  (1) uncertainty; 

  (2) a dispute over something indivisible; or

  (3) a commitment problem. 

Now this is a very significant contribution, because you can now predict the probability if any one dispute will become violent. Furthermore, as a policy maker, you can then zoom in on these three and eliminate them.  Now if theory is about engaging with empirics, about testing explanatory value, then this is not a bad track record.  Morgenthau in the preface to the third edition of Politics amongst Nations indicates he was urged to respond to critics of the logics of his theory, but he writes: ‘I will not stoop’.  But this is not stooping, this is how science progresses!  If your theory doesn’t hold to empirical scrutiny, what is it worth?  In my view, realist theory and balance of power theory is affected in its core by the empirical and logical challenges posed.  They have been sufficiently refuted, they are false theories, and we should move on. But they don’t move on.

source: Theory talk #31

        BRUCE BUENO DE MESQUITA ON GAME THEORY, PREDICTION AND FEAR OF LOGICS IN IR (International Relation) 

        filename: Theory Talk31_BuenodeMesquita.pdf

        http://www.theory-talks.org/2009/06/theory-talk-31.html

        (URL link was copy & past from pdf, unverified)  

www.theory-talks.org

   ____________________________________

 • States, as I see it, do not have interests or preferences or beliefs, people do. 

p.1

Among the debates that impinge on understanding I think two are central. One relates to the extent to which our focus might be better placed on individual decision makers and their interests rather than assuming that their interests and the state’s interests are the same.  Later in your questions, for instance, you conflate the two, assuming that the welfare of the state is what decision makers are concerned about. This conflation of state and individual interests is, in my view, a fundamental impediment to advancing our understanding of IR. States, as I see it, do not have interests or preferences or beliefs, people do. We may speak of the “national interest” as some aggregation of what most people want or what many people want, or what a few powerful people want, but each of these meanings can produce entirely different expectations about what is in the “national interest.” 

source: Theory talk #31

        BRUCE BUENO DE MESQUITA ON GAME THEORY, PREDICTION AND FEAR OF LOGICS IN  IR (International Relation) 

        filename: Theory Talk31_BuenodeMesquita.pdf

        http://www.theory-talks.org/2009/06/theory-talk-31.html

        (URL link was copy & past from pdf, unverified)  

www.theory-talks.org

   ____________________________________

Paul Saffo

 

Paul Saffo is another guy.  His thing is technology forecasting.  He also has a wikipedia page. 

https://en.wikipedia.org/wiki/Paul_Saffo

He wrote an article, Six Rules for Effective Forecasting, published in HBR.

Here is the URLs:

https://hbr.org/2007/07/six-rules-for-effective-forecasting

“The goal of forecasting is not to predict the future but to tell you what you need to know to take meaningful action in the present.”

you can use your 2 free articles for the month to read it or look for it (Six Rules for Effective Forecasting) some where else.  A pdf version of (Six Rules for Effective Forecasting) should be around somewhere on the InterNet.  I read the article.  It was helpful, useful, and gave me mental tools on how to think about forecasting.  

By Paul Saffo 

“Six Rules for Effective Forecasting”, 

Harvard Business Review article

One must look for the turns, not the straightways, and thus one must peer far enough into the past to identify patterns. 

 ... one must peer far enough into the past to identify patterns. 

Rule 5 : Look back twice as far as you look forward 

The following is my note summary from his youtube video, Paul Saffo: Never Mistake a Clear View for a Short Distance: 

 (1) Large mega-trend is usually invisible, too big to see the big picture; for example, generally, there is a 40 to 60 years cycle of demographic shift in aging population. It is difficult to see the forest, if you are a bird, living in a tree. [air pollution (dirty air) effects on public health]

 (2) very tiny signal at the inflection point is also usually invisible, it is too small to notice, you would need instrumentation, tools, measurement, record keeping, plotting the data points on a graph paper, to look at the pattern over time to tease out the inflection point.  And even if we see the inflection point, the importance of the inflection point might not be obvious until nearly five to seven years later.  Like for example, the form (or type) of cancer for a person of interest, the inflection point might not show up and become detectable until nearly 30 years later; at the opposite end, the inflection point of autism spectrum disorder, in young children, shows up rather early; notice that I am unable to address the root cause of the inflection point.  The ability to look at the data point as one whole pattern over time can be useful.  Inflection point is also refer to as tipping point, threshold, and other labels.  

 (3) constant is invisible, constant is notice only if it changes, for example in the Western developed countries like the United States, including Japan, electrical power is assume to be there 24/7; electricity is constant.  Another example, garbage collection happens once every week; this is constant and, mostly taken for granted. [air pollution (dirty air) effects on public health] 

“constant is notice only if it changes, constant is invisible”

   ____________________________________

Gerald M. & Daniela Weinberg, General principles of systems design, 1988    [ ]

p.330

   many more “invisible” mechanism are simple built into the norms of behavior in society. Such norms usually remain invisible unless and until specific revolutionary acts make them conspicuous, so that their existence may no longer be denied. Who knows how many society's mechanism incorporate the automobile until there is rationing of gasoline? Who imagines the influence of television on birth rate until there is a power failure? 

   (General Principles of Systems Design, Gerald M. Weinberg, Daniela Weinberg, formerly titled On the Design of Stable Systems, May 1979, p.330)

   ____________________________________

Paul Saffo: Never Mistake a Clear View for a Short Distance

https://www.youtube.com/watch?v=u8NrFDocBF0

https://www.youtube.com/watch?v=u8NrFDocBF0

Published on Dec 6, 2013

(20:10)

san andreas fault, 2-inches of movement per year, as pressure built up, an earthquake is inevitable, the question is when; 

the pressure are building over time; 

things go non-linear at the inflection point; 

identifying the inflection;  

innovation is generally good news, it can be disruptive to business model; 

most ideas take 20 year to become an overnight success; 

1947-1968: 21 years; 

look for underlying driving forces; 

3 kind of driving forces: constants, cycles (repeated pattern), and novelties; 

constant is notice only if it changes, constant is invisible; 

sun spot cycle; 

Kondratiev wave, about a 50 year cycle, 

prosperity → recession → depression → improvement (Kondratiev wave, about a 50 year cycle); 

2 kinds of novelties: novelty so small that you overlook them, so big; 

example of so big: humanity became a majority urban dweller; 

a single drive force rarely determine outcome; 

cherish failures, especially someone elses; 

alpha is being the first to identify inflection point and turn it into strategy; 

embrace uncertainty; 

we like [the] things [that we like and to our benefit] to stay the same.

   ____________________________________

 → why it is important to have some understanding of forecasting 

 → look for underlying driving forces; 

 → 3 kind of driving forces: constants, cycles (repeated pattern), and novelties; 

 → a single drive force rarely determine outcome; 

 → Because I don't know what lies behind something, I cann't keep up, and at something of a disadvantage.  And that's no way to live.  To be uninformed and entirely at someone else's mercy. (Netflix streaming show, The Queen, first season)  

  <---------------------------------------------------------------------------->

By Paul Saffo 

“Six Rules for Effective Forecasting”, 

Harvard Business Review article, July-August 2007

   ... ... ... 

futurist Roy Amara 

   ... ... ... 

   The entire portion of the S curve to the left of the inflection point is paved with indicators──subtle pointers that when aggregated become powerful hints of things to come.  The best way for forecasters to spot an emerging S curve is to become attuned to things that don't fit, things people can't classify or will even reject.  Because of your dislike of uncertainty and our preoccupation with the present, we tend to ignore indicators that don't fit into familiar boxes.  But by definition anything that is truly new won't fit into a category that already exists.  

   ... ... ... 

   More often than not, indicators look like mere oddball curiosities or, worse, failures, and just as we dislike uncertainty, we shy away from failures and anomalies.  But if you want to look for the thing that's going to come whistling in out of nowhere in the next years and change your business, look for interesting failures──smart ideas that seem to have gone nowhere. 

   ... ... ... 

   The essential difference between the two skippers' responses was that the Delphy's skipper ignored evidence that invalidated his dead-reckoning information and narrowed his cone of uncertainty at the very moment when the data was screaming out to broaden it.  In constrast, the Kennedy's skipper listened to the multiple sources of conflicting weak information and concluded that his ship's position was much less certain than assumed.  He hedged their bets and, therefore, saved the ship. 

   In forecasting, as in navigation, lots of interlocking weak information is vastly more trustworthy than a point or two of strong information.  The problem is that traditional research habits are based on collecting strong information.  And once researchers have gone through the long process of developing a beautiful hypothesis, they have a tendency to ignore any evidence that contradicts their conclusion. 

   ... ... ... 

Thomas Kuhn 

The structure of scientific revolutions.

Thomas Kuhn's nonlinear process of paradigm shifts 

Once a theory gains wide acceptance, there follows a long stable period in which the theory remains accepted wisdom.  All the while, however, contradictory evidence is quietly building that eventually results in a sudden shift. 

   ... ... ... 

   Good forecasting is the reverse:  It is a process of strong opinions, weakly held.  If you must forecast, then forecast often──and be the first one to prove yourself wrong.  The way to do this is to form a forecast as quickly as possible and then set out to discredit it with new data. 

   ... ... ... 

By formulating a sequence of failed forecasts as rapidly as possible, you can steadily refine the cone of uncertainty to a point where you can comfortably base a strategic response on the forecast contained within its boundaries.  Having strong opinions gives you the capacity to reach conclusions quickly, but holding them weakly allows you to discard them the moment you encounter conflicting evidence. 

   ... ... ... 

One must look for the turns, not the straightways, and thus one must peer far enough into the past to identify patterns. 

 ... one must peer far enough into the past to identify patterns. 

Rule 5 : Look back twice as far as you look forward 

   ... ... ... 

It all seems to defy categorization, much less prediction, until one looks back five decades [50 years] to the emergence in the early 1950s of TV and the subsequent mass-media order it helped catalyze.  The present moment has eerie parallels to that era, and inspection of those similarities quickly brings today's landscape into sharp focus:  We are in a moment when the old mass-media order is being replaced by a new personal-media order, and it's not just the traditional media players that are struggling to adjust.  The cutting-edge players of the information revolution, from Microsoft to Google, are pedaling every bit as hard. 

   ... ... ... 

  source: HBR six rules for effective forecasting.pdf

  <---------------------------------------------------------------------------->

http://longnow.org/seminars/02008/jan/11/embracing-uncertainty-the-secret-to-effective-forecasting/

Paul Saffo is a forecaster with over two decades experience exploring the dynamics of large-scale, long-term change. 

"Some would argue that forecasting is a dangerous exercise in futility, but they are mistaken. In fact, effective forecasting is not merely possible, but remarkably easy; all it takes is simple shift in perspective and a few common-sense heuristics." The most quoted futurist alive, Paul Saffo specializes in the history and future of technology. In a recent article in the Harvard Business Review he spelled out the secrets of his trade, which he will expand on in this talk. Saffo is a member of the board of The Long Now Foundation.

Rules of Forecasting

Reflecting on his 25 years as a forecaster, Paul Saffo pointed out that a forecaster’s job is not to predict outcomes, but to map the “cone of uncertainty” on a subject. Where are the edges of what might happen? (Uncertainty is cone-shaped because it expands as you project further into the future— next decade has more surprises in store than next week.)

[Rule]: Wild cards sensitize us to surprise, and they push the edges of the cone out further. You can call weird imaginings a wild card and not be ridiculed. Science fiction is brilliant at this, and often predictive, because it plants idea bombs in teenagers, which they make real 15 years later.

[Rule]: Change is never linear. Our expectations are linear, but new technologies come in “S” curves, so we routinely overestimate short-term change and underestimate long-term change. “Never mistake a clear view for a short distance.”

“Inflection points are tiptoeing past us all the time.” He saw one at the DARPA Grand Challenge race for robot cars in the Mojave Desert in 2004 and 2005. In 2004 no cars finished the race, and only four got off the starting line. In 2005, all 23 cars started and five finished.

[Rule]: Look for indicators- things that don’t fit. At the same time the robot cars were triumphing in the desert, 108 human-driven cars piled into one another in the fog on a nearby freeway. A survey of owners of Roomba robot vacuum cleaners showed that 2/3 of owners give the machine a personal name, and 1/3 take it with them on vacations.

[Rule]: Look back twice as far. Every decade lately there’s a new technology that sets the landscape. In the 1980s, microprocessors made a processing decade that culminated in personal computers. In the 1990s it was the laser that made for communication bandwidth and an access decade culminating in the World Wide Web. In the 2000s cheap sensors are making an interaction decade culminating in a robot takeoff. The Web will soon be made largely of machines communicating with each other.

[Rule]: Cherish failure. Preferably other people’s. We fail our way into the future. Silicon Valley is brilliant at this. Since new technologies take 20 years to have an overnight success, for an easy win look for a field that has been failing for 20 years and build on that.

[Rule]: Be indifferent. Don’t confuse the desired with the likely. Christian end-time enthusiasts have been wrong for 2,000 years.

[Rule]: Assume you are wrong. And forecast often.

[Rule]: Embrace uncertainty.

Saffo ended with a photo he took of a jar by the cash register in a coffee shop in San Francisco. The handwritten note on the jar read, “If you fear change, leave it in here.”

PS… You can find different rules and a more strait-laced presentation by Saffo in his Harvard Business Review article, “Six Rules for Effective Forecasting,” here.        --Stewart Brand

  <---------------------------------------------------------------------------->

Taiwan Semiconductor Manufacturing

Marvin Centron with Alicia Pagano and Otis Port, The future of American business., 1985

pp.183-184
  The Taipei government has seen the handwriting on the wall for a decade, but it has had scant success in persuading industrialists to invest in newer markets.  In the early seventies the government decided to start the ball rolling and founded the Electronics Research and Service Organization [ERSO] to spearhead the drive into semiconductors and electronics.  When that example didn't catch on, the government intervened again in 1979, setting up the Institute for Information Technology, a software R&D center, and underwriting part of United Microelectronics corporation, a maker of integrated circuits.  But neither of these initiatives has been a barn-burner, either.  Taiwan's business leaders are typically in their sixties and simply scared of the risks entailed in high-tech diversification.  Most of the $290 million of computer equipment that Taiwan exported in 1983 came from foreign-owned assembly plants.
  So now Taiwan is dangling venture capital in front of expatriate Chinese who came to the United States for a degree in electrical engineering or computer science and stayed on to work in Silicon Valley or along Route 128.  Three Silicon Valley companies headed by Chinese managers have risen to the bait and are building chip making plants in Taiwan.  Government officials hope they will be the  nucleus of future growth as younger, more adventurous managers take over the reins of business in the 1990s.  Unfortunately, the move into microchips comes too little, too late.

  (The future of American business./ Marvin Centron with Alicia Pagano and Otis Port, 1. united states──industries──forecasting., 2. economic forecasting──united states., 3. united states──economic conditions──1981-, HC106.8.C45  1985, 338.5'443'0973, ISBN 0-07-010349-6, 1985, )
   ____________________________________

If you go on youtube.com, and search for TSMC, Taiwan Semiconductor Manufacturing Company, and any other terms related to this, and watch the video(s), one of the take away (conclusion) you might come to is that, it is hard and tough to be successful in the business (industry) of semiconductor manufacturing.  TSMC (Taiwan Semiconductor Manufacturing Company) was able to put the essential elements together (initial setup), recruited top people, mentored and trained them, worked like hell, and so far, managed to make a success out of a very high cost, bleeding edge, and capital intensive business.  My focus was on Morris Chang, the founder of TSMC, Taiwan Semiconductor Manufacturing Company.  


TSMC (Taiwan Semiconductor Manufacturing Company)


 • build a platform (pure play semiconductor manufacturing, inflection zone, re use ability (IP), technological development within the industry; development of communication protocol and, evolution of standard & design rules between the upstream and downstream supply-chain (functional role), specialization and knowledge domain, veterans with 25 years experience, they have been to the top and seen the roadmap, unique)


50% investment from the Government
the rest from other sources
  get one multination as an anchor investor
  Intel, TI, Toshiba, Hitashi, NEC, Phillips, Sony  
Phillips invested in 28%
48% from the Taiwan government
the remaining from 12 or 13 companies
one big investor, a 5% investor, I went there 3 times, three separate times  
during dinner, they keep on quizing me, I didn't even have time to eat,
the government has been good to you for the last 20 years, you better do something;

1985 to 2005:  rise of fabless companies in the U.S.
1985 to 2005:  Japanese companies market share - in the semiconductor production (manufacturing, chips foundry) - has dropped 20 point
1985 to 2005:  fabless companies went from zero to 20%

English literature, Chinese literature, classical music
the two books next to my bed, to tired to read anything serious,
it's Chinese, Red Chamber Dream, Chinese classic
and the other, Shakespeares's plays, I am interested in Shakespeares's tragedies
a lot of meaning, lots of life lesson in Shakespeares's plays
I am interested in history in general
I am interested in biography
benefits from these outside reading
I am a student of the second world war, the main battle
I often compared the competitive battle that TSMC go through to battle in the 2nd world war, Battle of Stalingrad
Stalingrad was the one I was very interested in,
the Midway, the naval battle, the Japan commander could not make up his mind, whether to keep bomber on deck, or the fighter on deck; he changed it, that cost him the battle; indecision is very bad ..., and in company;  

learn and think, both are important
Confucius's statement:  learning and think are both important, if you just learn and don't think, then you quickly become lost; if you just think and don't learn, then you quickly run out of material to think.  

he said, started a Semiconductor company, he didn't know the business, so he was thinking an IBM, a semiconductor company
I came up with TSMC business model, game plan,
he had confidence in me, because he knew what I had done at TI (Texas Instrument), so he trust me
even though he didn't know what a foundry was, he trusts me,
first you had to start with the insight that the Taiwan government back, 10 years early, in 1975, when they started this seed group, development group in ERSO - an  R&D institute responsible for supervising the development of the semiconductor industry, a branch off from [[ITRI]]. ([ERSO] process was two generation behind), it was pretty big money for them, at that time, even just the RCA contract, the RCA technology transfer contract was 4 or 5 million dollars, which was big money for the Taiwan government at the time, and then sustaining their own development activity, that probably cost a few million dollar a year, and that was pretty big money for Taiwan government, but they did it,
and then, of course, when the time came, when I started to setup TSMC, the second minister and the premier said, they would support 50%, they didn't know it would be 50% of 220 million ([ table stake ]), they thought it was a much smaller number than that, but they swallow that also, so so   

工業技術硏究院 (ITRI - Industrial Technology Research Institute)

1985   already started to raise money
1987   founded TSMC

they're very happy now

maybe the decrease in cost, at the same rate, not as it happened before

there is a tendency for fabless company, consolidating, in 5 years, 10 years,

I had achieve a measure of financial independent, financial independent means I didn't need a job, I could live on the interest rate,  

the merchant of Venice

the core of our problem:  what we can sell, we cannot make, and what we make, we cannot sell;  

source:
        
* {{YouTube|id=cwlsNJuCgQI|title=Morris Chang: an emphasis on excellence}} • stanford eCorner • 54:10 • May 14, 2014

https://www.youtube.com/watch?v=cwlsNJuCgQI
https://www.youtube.com/watch?v=cwlsNJuCgQI
        
        https://en.wikipedia.org/wiki/Industrial_Technology_Research_Institute
   ____________________________________

The R&D system for industrial development in Taiwan
Tain-Sue Jan*, Yijen Chen

National Chiao Tung University, Department of Management Science, 1001 Ta Hsueh Road, Hsinchu 30050, Taiwan

   ....  ... ....

The Taiwanese semiconductor industry began in the mid-1960s, when foreign enterprises used the low labor costs of Taiwan to establish their encapsulation plants. Crucial to the true development of the Taiwanese semiconductor industry was the intervention of the government in 1974 in establishing ERSO (Electronics Research and Service Organization) within ITRI, a government-supported R&D institute responsible for supervising the development of the semiconductor industry, and for providing relevant key technologies and human resources. ERSO was crucial in establishing the Taiwanese electronics industry through technology R&D, technology transfers and spin-offs.  In 1976, ERSO introduced the 7 Am CMOS (Complementary Metal Oxide on Silicon) IC (integrated circuit) design and production process technology from RCA of the United States. Then in 1977, ERSO established the first IC pilot plant in Taiwan.  Through absorption, utilization, and self-development, ERSO converted IC production process technology into merchandise and conducted a pilot run program.  To avoid emphasizing production capacity at the expense of R&D at ITRI, ITRI considered transferring the merchandising to the private sector.  At this stage Taiwan had no semiconductor industry, and the private sector lacked the confidence to establish IC firms. Therefore, ERSO decided to transfer technology and human resources to ITRI-derived companies. In 1979, UMC, the first IC company in Taiwan was born.

   In 1982, ITRI initiated research on and development of Very Large Scale Integrated (VLSI) semiconductor production processes, and upgraded the 7 Am process to 2 Am technology.  In 1987, R&D by ITRI resulted in the spinning off of Taiwan’s first 6-in. wafer fabrication foundry, TSMC, which was also the first pure semiconductor foundry in the world.  ITRI transferred some 100 of the engineers it had trained to this spin-off and used its pilot plant as the manufacturing site for the fledgling TSMC.  TSMC ran successfully right from the earliest stages of its development.  This smooth running can be attributed to the transfer of personnel and equipment.  In mid-1988, the production technology of TSMC was just nine months behind that of TI and Intel.  The advanced semiconductor production process technology and the operating model of the semiconductor foundry led to the establishment of the semiconductor encapsulation, testing, and design industries as well as the consolidation of the Taiwanese semiconductor manufacturing industry.  Taiwan did not have a complete system for the vertical division of the semiconductor industry by 1988, although one was gradually appearing [20].  To establish a complete supply chain for the semiconductor industry and to prevent brain drain, beginning in 1989 ITRI organized the transfer of people, technologies and equipment to the first photomask company in Taiwan, TMC.  Since then Taiwan has had a complete semiconductor industrial system, including sub-industries in IC design, photomask manufacture, wafer fabrication, IC packaging and testing, with each sub-industry specializing in its own area of expertise [20].  

   ....  ... ....

source:
        http://entofa.net/wp-content/uploads/2019/11/The-RD-system-for-industrial-development-in-Taiwan.pdf
   ____________________________________

Dorothy Leonard-Barton, Wellsprings of Knowledge : building and sustaining the sources of innovation, 1995

Figure 8-4, 8-5, 8-6, 8-7
  the knowledge and physical systems being transfer:
    (nested rings: a ring inside a ring)
     Norms/Values (biggest concentric circle)
     Skills and Knowledge (smaller concentric circle)
     Managerial Systems (and smaller concentric circle)
     Physical Systems (smallest core circle)

  p.224
Level 1 transfer: assembly and turnkey operations

  p.230
Level 2 transfer: adaptation and localization

  p.235
Level 3 transfer: product redesign

pp.232—233, p.234
  pp.232—233
Degree of localization appears to depend in large part on the level of capabilities transfer the technology source intends and on its willingness to invest heavily to reach that level.  Beijing Jeep Corporation, a joint venture between Beijing Automotive Works (BAW) and Chrysler Corporation (formerly AMC, which was brought by Chrysler in 1987), was scheduled to reach 80 percent local sourcing by 1990.  The company had reached about 40 percent by that year.19  Shanghai Volkswagen took five years to reach 30 percent of local content, 20 and its experience is not uncommon.

  p.234
    Such problems stemmed in part from the fact that Volkswagen did not offer technical assistance or formal technology transfer to local suppliers, and Shanghai did not request it.  By 1991, the local content of the Santana reached only 70 percent, well below the joint venture's expectations.  In 1993, local content reached about 80 percent.

p.237
    Success at level 3 is defined as the ability to redesign an entire product rather than just components.
    ...  [...]  ...
    Therefore, at level 3, the knowledge transferred moves beyond know-how to know-why.23
    Hewlett-Packard's Singapore facility took nearly twenty years to reach that capability.

  p.241
Level 4 transfer: independent design of products

    (Leonard-Barton, Dorothy, copyright © 1995, HD30.2.L46 1995, 658.4'038——dc20)
(Wellsprings of Knowledge : building and sustaining the sources of innovation / Dorothy Leonard-Barton, 1. information technology——management, 2. information resources management, 3. management information systems, )
   ____________________________________

It grew by helping fabless customers like Broadcom, Nvidia, and others grow. It invested immense amounts of money in R&D to investigate the latest techniques and in servicing its customers. Being able to work with all different types of customers helped it see the most common types of challenges that customers would face.

source:
        https://asianometry.substack.com/p/tsmc-briefly-explained
   ____________________________________

 Simon Sinek in conversation with Big Change - Education as an Infinite Game
         https://www.youtube.com/watch?v=Ze-pXbrWLkc
         https://www.youtube.com/watch?v=Ze-pXbrWLkc
         youtube.com
         27:04
         Big Change
         Jun 10, 2019
   ____________________________________

  The Tainan Science Park, Taiwan (running out of space)
  a second science park was needed
  open in year 2000, Fab-6, less than two year later
  Fab-6 would cost over $2 billion dollar, six stories, clean room
  at its unveiling, it would be the largest Fab in the world, and
  the other other Fab were not small either
  expansion of Fab-14, delay, concern with vibration from nearby high-speed train
  expansion to Fab-14 was completed four years later
  Fab-15
  Fab-18 Giga fab, latest n5p process, 2018, 2019, cost $17 billion dollar to build, more than the per unit cost of Gerald Ford aircraft carrier (cost $13 billion dollar),
  Fab-6 employed, 2,600 people, most of them, highly educated engineers  
  the knock on effects of tech wealth, san francisco and silicon valley, I recognize alot of the symptoms  


source:
        youtube.com
        How TSMC came to Taiwan's South        
        10:18
        Sep 7, 2020
        https://www.youtube.com/watch?v=x02pq2HeKQY
        https://www.youtube.com/watch?v=x02pq2HeKQY

        https://en.wikipedia.org/wiki/TSMC
   ____________________________________

ball park figures (USD $)
1 billon = 1.000 million

[ $17 billion ]
TSMC  (Taiwan Semiconductor Manufacturing Company) giga Fab-18 cost around $17 billion

[ $17.5 billion ]
aircraft carrier USS Gerald R. Ford's total cost of development $12.8 billion + $4.7 billion R & D (estimated)

[ $64.540 billion ]
“Current Estimate” for the F-22 program in “Then-Year” dollars of $64.540 billion for 181 aircraft (FY 2006 dollar), which includes both research and development (R&D), and procurement.
    https://www.pogo.org/analysis/2009/03/what-does-f-22-cost/
    https://www.globalsecurity.org/military/systems/aircraft/f-22-cost.htm

[ $4.61 billion - 2014 inflation adjusted ]
KH-11,
    a type of reconnaissance satellite,
    the first American spy satellite to use electro-optical digital imaging, and create a real-time optical observation capability.[8],
    also known as codenames 1010,[7] and "Key Hole"[7],
    also known as KH-11B or KH-12 by outside observers,
    Manufactured by Lockheed in Sunnyvale, California,
    The Key Hole series was officially discontinued in favor of a random numbering scheme after repeated public references to KH-7 Gambit, KH-8 Gambit-3, KH-9 Hexagon, and KH-11 satellites.[9],
    KH-11 satellites require periodic reboosts to counter atmospheric drag, or to adjust their ground track to surveillance requirements.
    According to Senator Kit Bond initial budget estimates for each of the two legacy KH-11 satellites ordered from Lockheed in 2005 were higher than for the latest Nimitz-class aircraft carrier (CVN-77)[13] with its projected procurement cost of US$6.35 billion as of May 2005.[67]
    In 2011, after the launch of USA-224, DNRO Bruce Carlson announced that the procurement cost for the satellite had been US$2 billion under the initial budget estimate, which would put it at about US$4.4 billion (inflation adjusted US$4.61 billion in 2014).[14]

KENNEN Ground Station,

http://en.wikipedia.org/wiki/KH-11 Kennan
   ____________________________________

The narrator/writer on the youtube channel Asianometry mentioned that TSMC  (Taiwan Semiconductor Manufacturing Company) giga Fab-18 cost around $17 billion dollar, and the aircraft carrier USS Gerald R. Ford's total cost of development $12.8 billion + $4.7 billion R & D (estimated).  It is a nice comparison.  


USS Gerald R. Ford – The Largest & Most Expensive Ship Ever Built
Our Bureau
March 18, 2021
March 18, 2021

The USS Gerald R. Ford is the U.S. Navy’s newest, most expensive, and largest aircraft carrier – in fact, it’s the largest and most expensive aircraft carrier in the world.

Commissioned in July 2017, the USS Ford is the first of the Ford-class carriers, which are more technologically advanced than current Nimitz-class carriers.

USS Gerald R. Ford Facts

This ships’ total cost of development is a whopping $12.8 billion + $4.7 billion R & D (estimated).

The Ford-class of the aircraft carriers is intended to relieve stress and over deployment within the US Navy. Currently, it operates 10 carriers but wants an additional carrier to take the pressure off of the rest of the fleet.

The ship features a host of improvements over the Nimitz-class carrier. Ford-class carriers’ power generation capacity will be three times that of the older carrier classes.

What it can carry

Full load displacement of 100,000t makes USS Gerald R. Ford the world’s biggest aircraft carrier, and also the most expensive aircraft carrier in the world.

The CVN-78 features a 78m-wide flight deck, equipped with an electromagnetic aircraft launch system and advanced arresting gear.

The carrier has the capacity to carry more than 75 aircraft and can accommodate 4,539 personnel including the ship’s company, air wing, and other support staff.

It can reach the speed of 30+ knots.

Gerald R Ford is powered by two A1B nuclear-reactors offering 250% more electrical capacity than the Nimitz Class.

The weaponry includes RIM-162 Evolved Sea Sparrow-missiles, Rolling Airframe-Missiles (RAMs), and Phalanx close-in weapon system (CIWS).

As of 2020, she is the world’s largest aircraft carrier, and the largest warship ever constructed in terms of displacement.

In the future, USS Ford will also field laser and directed-energy weapons like rail guns and missile interceptors.


source:
        https://www.textise.net/showText.aspx?strURL=https://usadefensenews.com/2021/03/18/uss-gerald-r-ford-the-largest-most-expensive-ship-ever-built/
   ____________________________________
 ── early development of transistor (a microelectronic component) on silicon
    ──
 ── the transistor was initially developed using germanium (why germanium? I have no idea.)
   ____________________________________
stabilize the silicon surface

Mohamed M. Attalla Developed the silicon surface passivation process in 1957,[92][103] and then invented the MOSFET (metal-oxide-semiconductor field-effect transistor), the first practical implementation of a field-effect transistor, with Dawon Kahng in 1959.[93][94][95][96] This led to a breakthrough in semiconductor technology,[104][105] and revolutionized the electronics industry.[93][94]

^ Sah, Chih-Tang (October 1988). "Evolution of the MOS transistor-from conception to VLSI" (PDF). Proceedings of the IEEE. 76 (10): 1280–1326 (1290). Bibcode:1988IEEEP..76.1280S. doi:10.1109/5.16328. ISSN 0018-9219. Those of us active in silicon material and device research during 1956–1960 considered this successful effort by the Bell Labs group led by Atalla to stabilize the silicon surface the most important and significant technology advance, which blazed the trail that led to silicon integrated circuit technology developments in the second phase and volume production in the third phase.
http://www.dejazzer.com/ece723/resources/Evolution_of_the_MOS_transistor.pdf

source:
en.wikipedia.org
Bell Labs
   ____________________________________
 ── process of silicon surface passivation by thermal oxidation, which electrically stabilized silicon suface and reduced the concentration of electronic states at the surface.
 ── this enabled silicon to surpass the conductivity and performance of germanium, leading to silicon replacing germanium as the dominant semiconductor material, and paving the way for the mass-production of silicon semiconductor devices.
 ── MOSFET (metal-oxide-silicon field-effect transistor), also known as the MOS transistor
 ── MOSFET was initially overlooked and ignored by Bell Labs in favour of bipolar transistors

In 1957, Mohamed Atalla at Bell Labs developed the process of silicon surface passivation by thermal oxidation,[28][29][30] which electrically stabilized silicon surfaces[31] and reduced the concentration of electronic states at the surface.[29] This enabled silicon to surpass the conductivity and performance of germanium, leading to silicon replacing germanium as the dominant semiconductor material,[30][32] and paving the way for the mass-production of silicon semiconductor devices.[33] This led to Atalla inventing the MOSFET (metal-oxide-silicon field-effect transistor), also known as the MOS transistor, with his colleague Dawon Kahng in 1959.[34] It was the first truly compact transistor that could be miniaturised and mass-produced for a wide range of uses,[35] and is credited with starting the silicon revolution.[32]

The MOSFET was initially overlooked and ignored by Bell Labs in favour of bipolar transistors, which led to Atalla resigning from Bell Labs and joining Hewlett-Packard in 1961.[36] However, the MOSFET generated significant interest at RCA and Fairchild Semiconductor. In late 1960, Karl Zaininger and Charles Meuller fabricated a MOSFET at RCA, and Chih-Tang Sah built an MOS-controlled tetrode at Fairchild. MOS devices were later commercialized by General Microelectronics and Fairchild in 1964.[34] The development of MOS technology became the focus of startup companies in California, such as Fairchild and Intel, fuelling the technological and economic growth of what would later be called Silicon Valley.[37]

Following the 1959 inventions of the monolithic integrated circuit (IC) chip by Robert Noyce at Fairchild, and the MOSFET (MOS transistor) by Mohamed Atalla and Dawon Kahng at Bell Labs,[34] Atalla first proposed the concept of the MOS integrated circuit (MOS IC) chip in 1960,[35] and then the first commercial MOS IC was introduced by General Microelectronics in 1964.[38] The development of the MOS IC led to the invention of the microprocessor,[39] incorporating the functions of a computer's central processing unit (CPU) on a single integrated circuit.[40] The first single-chip microprocessor was the Intel 4004,[41] designed and realized by Federico Faggin along with Ted Hoff, Masatoshi Shima and Stanley Mazor at Intel in 1971.[39][42] In April 1974, Intel released the Intel 8080,[43] a "computer on a chip", "the first truly usable microprocessor".

source:
en.wikipedia.org
Silicon Valley
   ____________________________________
Shockley's research team initially attempted to build a field-effect transistor (FET), by trying to modulate the conductivity of a semiconductor, but was unsuccessful, mainly due to problems with the surface states, the dangling bond, and the germanium and copper compound materials. In the course of trying to understand the mysterious reasons behind their failure to build a working FET, this led them instead to invent the bipolar point-contact and junction transistors.[22][23]

Semiconductor companies initially focused on junction transistors in the early years of the semiconductor industry. The junction transistor was a relatively bulky device that was difficult to mass-produce, which limited it to several specialized applications. Field-effect transistors (FETs) were theorized as potential alternatives to junction transistors, but researchers initially could not get FETs to work properly, largely due to the troublesome surface state barrier that prevented the external electric field from penetrating the material.[52]

In the 1950s, Egyptian engineer Mohamed Atalla investigated the surface properties of silicon semiconductors at Bell Labs, where he proposed a new method of semiconductor device fabrication, coating a silicon wafer with an insulating layer of silicon oxide so that electricity could reliably penetrate to the conducting silicon below, overcoming the surface states that prevented electricity from reaching the semiconducting layer. This is known as surface passivation, a method that became critical to the semiconductor industry as it later made possible the mass-production of silicon integrated circuits.[53][54] He presented his findings in 1957.[55] Building on his surface passivation method, he developed the metal–oxide–semiconductor (MOS) process.[53] He proposed the MOS process could be used to build the first working silicon FET, which he began working on building with the help of his Korean colleague Dawon Kahng.[53]

The metal–oxide–semiconductor field-effect transistor (MOSFET), or MOS transistor, was invented by Mohamed Atalla and Dawon Kahng in 1959.[4][5] The MOSFET was the first truly compact transistor that could be miniaturized and mass-produced for a wide range of uses.[52] In a self-aligned CMOS process, a transistor is formed wherever the gate layer (polysilicon or metal) crosses a diffusion layer.[56]: p.1 (see Fig. 1.1)  With its high scalability,[57] and much lower power consumption and higher density than bipolar junction transistors,[58] the MOSFET made it possible to build high-density integrated circuits,[6] allowing the integration of more than 10,000 transistors in a single IC.[59]

source:
en.wikipedia.org
Transistor
   ____________________________________
CMOS (complementary MOS) was invented by Chih-Tang Sah and Frank Wanlass at Fairchild Semiconductor in 1963.[60] The first report of a floating-gate MOSFET was made by Dawon Kahng and Simon Sze in 1967.[61] A double-gate MOSFET was first demonstrated in 1984 by Electrotechnical Laboratory researchers Toshihiro Sekigawa and Yutaka Hayashi.[62][63] FinFET (fin field-effect transistor), a type of 3D non-planar multi-gate MOSFET, originated from the research of Digh Hisamoto and his team at Hitachi Central Research Laboratory in 1989.[64][65]

source:
en.wikipedia.org
Transistor
   ____________________________________

some thing to keep in mind:
  ── the integrated circuit (also refer to as ‘chip’) is made (fabricated, fabrication) using a great deal of water, and chemicals (some really nasty chemicals), collectively refer to as CMR agents;
      ── CMR agents──shorthand for carcinogens, mutagens, and reproductive toxins;
      ── source: Bloomberg Businessweek, June 19, 2017, Chip making moved to Asia.  Miscarriages and birth defects followed; The price of a digital world, by Cam Simpson, with Ben Elgin, Heesu Lee, and Kanoko Matsuyama.
      ── you would think, right, that your computer is electronics and physics, yes; but to make the physical electronics, you need chemistry; and I did not know that;  
   ____________________________________

https://en.wikipedia.org/wiki/Moore%27s_law
   ____________________________________

  ── learning curve advantage over time
  ── (Apple, ARM, TSMC), Intel, 15 years
  ── why this moment was 15 years in the making
  ── former chief of staff (later general manager to Intel China) to Andrew Grove
  ── mobile phone industry
  ── Intel (manufacturing chips for the whole computer industry)

https://apple.slashdot.org/story/20/08/23/1846258/how-a-decision-by-apple-15-years-ago-hurts-intel-now
([ cannot get to the South China Morning Post piece ])
https://www.scmp.com/tech/big-tech/article/3098323/how-decision-15-years-ago-contributed-intels-fall-grace-today

How a Decision by Apple 15 Years Ago Hurts Intel Now (scmp.com)127

Posted by EditorDavid on Sunday August 23, 2020 @01:50PM

The former chief of staff to Intel CEO Andrew Grove (and later general manager of Intel China) explains why this moment was 15 years in the making:
Learning curve theory says that the cost of manufacturing a product declines as the volume increases. Manufacturing chips for the whole computer industry gave Intel huge advantages of scale over any other semiconductor manufacturer and resulted in the company becoming the world's largest chip manufacturer with enviable profit margins.

Chaos theory says that a small change in one state of a system can cause a large change in a later stage. In Intel's case, this was not getting selected by Apple for its iPhones. Each successive era of computing was 10x the size of the previous era, so while Intel produced hundreds of millions of microprocessors per year, the mobile phone industry sells billions of units per year. Apple's decision in 2005 to use the ARM architecture instead of Intel's gave Taiwan-based TSMC, the foundry chosen to manufacture the processor chips for the iPhone, the learning curve advantage which over time enabled it to pull ahead of Intel in manufacturing process technology.

Intel's integrated model, its competitive advantage for decades, became its vulnerability. TSMC and ARM created a tectonic shift in the semiconductor industry by enabling a large number of "fabless" chip companies such as Apple, AMD, Nvidia and Qualcomm, to name a few. These fabless companies began to out-design Intel in the mobile phone industry and accelerated TSMC's lead over Intel in high volume manufacturing of the most advanced chips. Samsung, which also operates a foundry business, has been another beneficiary of this trend.        

    ____________________________________

  6. what you want is not what you think you want

      • what you want is not what you think you want
         < let me rephrase that a different way >
      • what you are asking for is not what you think you want
      • this is what I asked for, but it is not what I want
      • You need to remember that there could be enormous gaps between what we  know and what we think we know; and the danger is not in the gaps, the danger is the consequences that would result from our decision-making process based on the assumption about the gaps*

   • “I need to remember, however, that there are enormous gaps between what I know and what I think I know.”;--Bolte Taylor, from 'The way we're working isn't working', Tony Schwartz, with Jean Gomes and Catherine McCarthy, p.214.

     • John C Randolph explained that Apple “not having their own chip design experts in-house made for very poor communication with Samsung, which is why the H1 processor in the iPhone wasn't quite what they wanted, although it was exactly what they'd asked for; in other words, mostly Apple's fault, not Samsung's.”
   •  
  • http://appleinsider.com/articles/15/01/19/how-intel-lost-the-mobile-chip-business-to-apples-ax-arm-application-processors  
   ____________________________________

Jon Gertner book, The idea factory: bell labs and the great age of innovation, 2012

https://en.wikipedia.org/wiki/The_Idea_Factory

([ This talk @ microsoft research is quiet good, the actual talk itself is short, end at 32:13, and if you skip the author (Jon Gertner) intro, you get a real feel for how long it takes to bring a thing like a solid-state transistor - it replaced the vacuum tube - into market [production], and how early in the beginning of the transistor development, it was unreliable (an ugly baby). Jon Gertner also mentioned, how important it was to innovation to have real problems to solve (this is known as applied research). ])  

([ In the microsoft research talk about Bell Lab, (Jon Gertner) mentioned a guy, name Davidson or [of] sort[s], I probably have his name wrong, and the spelling is wrong, too; I am going call him, Davidson (not the name, not the spelling), Davidson is constantly sick, or often sick, Davidson would be in his apartment, not at work, in his bath robe, writing down equations, the head of Bell Lab knows this because he would check in on Davidson when he did not come in; so when the head of Bell Lab had problems, would send the person with the problems to Davidson; Davidson does not solve the problems;  however, what Davidson would do is explain to the person (the guy) who had the problems, this is what is going on; that is it, no solution, no answer; Davidson would provide explaination and understanding to what is going on with the situation; the person with the problems would come back, and then be able to make progress with the problems; ... ])

The idea factory: bell labs and the great age of innovation
https://www.youtube.com/watch?v=OJsKgiGGzzs
https://www.youtube.com/watch?v=OJsKgiGGzzs
microsoft research
Sept 5, 2016
53:56

32:13 the talk ends, Q&A after this
   ____________________________________

       Oral history of Shang-Yi chiang
       interviewed by:   Douglas Fairbairn
       recorded on March 15, 2022
       computer history museum (CHM)

"When we develop one node, basically you have some learning cycles. First, you do some simulation. And you have some idea, then you run wafers to prove that. So, you run a group of wafers according to simulation and you have some splits. The wafer runs through the fab, they come out and you measure them, you analyze them, and you try to improve and you run this again. This again, you run. So, this is learning cycle."

"It takes about six learning cycle, roughly, to complete one generation."

"My R&D wafer in the fab run much faster than yours, because my R&D engineer works three shifts and you only work one shift. So, your R&D wafer move eight hours a day, my work/move 24-hours a day. So, my wafers go three times faster, even if you are twice smarter than me, I still beat you up."   

https://archive.computerhistory.org/resources/access/text/2022/07/102792671-05-01-acc.pdf
   ____________________________________

https://ethw.org/Shang-Yi_Chiang

 ETHW
Shang-Yi Chiang
Jump to:navigation, search
Shang-Yi Chiang

Associated organizations
    Taiwan Semiconductor Manufacturing Company
Fields of study
    Semiconductors

Biography

Shang-Yi Chiang’s insight and expertise have transformed Taiwan Semiconductor Manufacturing Company (TSMC) from a technology follower to a driving force with one of the most advanced research and development (R&D) teams, helping it become the world’s largest dedicated independent semiconductor foundry. Known for taking well-calculated risks and making bold decisions, Dr. Chiang created an environment at TSMC for developing innovations that have made digital technology commonplace in society, profoundly impacting productivity, education, entertainment, and healthcare. Under Dr. Chiang’s direction, TSMC’s R&D organization grew from 148 people to 5,500 and has set milestones in semiconductor technology scaling at nodes from 0.25 microns all the way down to 28 nanometers. Game-changing initiatives implemented under Dr. Chiang’s leadership include a dedicated full/half node R&D roadmap, allowing customers to further reduce wafer cost. He also developed a strong lithography and electron-beam mask technology team that has advanced lithography, patterning, resist, and mask technologies for industry-leading high-density application-specific integrated circuit (ASIC)/system-on-chip (SoC) technologies for foundry customers and the logic semiconductor industry. Also important to ASIC/SoC applications has been TSMC’s high-density and energy-efficient interconnect efforts, where Dr. Chiang led his team to the industry’s first high-volume development of copper low-dielectric constant interconnects at 0.13 µm and subsequent nodes. Dr. Chiang also initiated a major direction change in three-dimensional (3D) IC technology to focus on “chip on wafer on substrate” (CoWoS) as a stepping stone to full-scale 3D-IC. This established TSMC as the leader in 3D-IC technology with industry-first high-volume production of CoWoS. This paved the way for system-level scaling for many emerging applications and has driven semiconductor industry growth.

An IEEE Life Fellow and recipient of Business Week magazine’s Star of Asia award (2001), Dr. Chiang is currently advisor to the chairman at Taiwan Semiconductor Manufacturing Company, Los Gatos, CA, USA.
   ____________________________________
https://archive.computerhistory.org/resources/access/text/2022/07/102792671-05-01-acc.pdf

Chiang: Intel, Motorola, National, HP. And they're all my customers.
Fairbairn: Right

Chiang: And the board member they sent to Sematech for many companies happen to be the person also in charge of the supply chain. Well, they are my major customer, but on the Sematech board we kind of sit together, we can discuss things on equal base. Not like my customer. <laughs> And so, in that platform we are able to-- some time we are able to more freely exchange some information. So, one time at a dinner, they asked me, they said that, "We all take two years to develop one generation, how come you guys can do it in one or one-and-a-half year?" And they asked if some of your customer transfer technology to you or what not? And I told him, "No," I told him that, "That's not true." I think he probably
implied we steal technology from customer, the way he talk.
And I say, "I'll tell you why." I said that, "When we develop one node, basically you have some learning cycles. First, you do some simulation. And you have some idea, then you run wafers to prove that. So, you run a group of wafers according to simulation and you have some splits. The wafer runs through the fab, they come out and you measure them, you analyze them, and you try to improve and you run this
again. This again, you run. So, this is learning cycle." At that time, "It takes about six learning cycle , roughly, to complete one generation." Of course, you had some short loops and not just one. I said that, "My R&D wafer in the fab run much faster than yours, because my R&D engineer works three shifts and you only work one shift. So, your R&D wafer move eight hours a day, my work/move 24-hours a day. So,
my wafers go three times faster, even if you are twice smarter than me, I still beat you up." <laughter>

Fairbairn: That's what everybody says. Faster learning cycle, right?

Chiang: Faster learning cycle. And three to one is kind of a little bit exaggerated, because it's usually night shift it's not very effective. Just the idea. But because I knew at HP, TSMC R&D wafer did move much, much faster than HP. But HP is not a good benchmark

Fairbairn: Not a good bench-- yeah.

Chiang: And then they ask me, "How can you make your R&D engineer work night shift?" And I kind of joke with them -- and I can share with you the real reason what I think. But at that time, I told them, I said, "In Taiwan, we all have to serve the military." I said, "I did. When you're in service, you-- especially in the basic training-- you take a duty for the security guard."

Fairbairn: Mm hm, stand watch.

Chiang: Stand watch, right. "It may be my turn from 2 a.m. to 3 a.m. Then the guy would wake me up at 1:45. Then I got up, I change my clothes, I got my helmet, got my rifle, then I went over at 2 o'clock, and 2:45 I wake up another guy. And so, all my engineers have been through that. So, I tell him to, you know,
it's your turn to do that! <laughs> Don’t complain!" <laughter>

And what interesting at that time, the board member from Motorola, I just remember, his name was Bill Walker-- I don't know if you know him or not?

Fairbairn: No, I don't think I know him.

Chiang: Bill Walker. He's a big, big guy. Later on, I found he used to be a Marine. I knew that later.
Fairbairn: Yeah.

Chiang: Because he was one of my very large customers, I usually visit him once a year.

Fairbairn: Mm hm.

Chiang: I went over with our sales manager and the two of us usually went to his office. And he had one of his Supply Chain Manager - four of us sit-down. Usually Bill would give us a lecture telling us what we did wrong and how bad we behaved. I took notes. The meeting lasts an hour. Next time I visit him, they took me to a different room. I found it a little bit different. When they opened the door, there were about 20 people around the table. He was in charge of R&D and the manufacturing for Motorola Semiconductor Worldwide. He said, "These are my R&D and the fab managers in the entire world. I got them together. I want you to tell the same story to them." <laughter> So, that was what I always told them but they didn’t listen.

Fairbairn: So, what was the real answer about <laughter>?

Chiang: The real answer is I, honestly, I just share with you, I think the culture. Asians are more hungry, because we had a tougher life. So, to make money is more important to us. People are willing to sacrifice their own privacy, their private life in order to have financial security.

Fairbairn: That's what you did. You moved to Taiwan without your wife or your family, right?

Chiang: Right. Just to make a living.

Fairbairn: And work 22 hours a day.

Chiang: <laughs> But not later. So, I firmly believe this is one of the really important reasons why TSMC succeeded. It's culture. If equipment went down, because equipment depreciation cost was so high, you really want to run your equipment 24 hours a day. In United States, if equipment went down, wait until next morning. The people come in at eight o'clock and probably go to fix it, nine o'clock. Yeah. But if at two o'clock in the morning, we just called the equipment engineer, "You come right away," he won't complain. And his wife won't complain. And that's the way it is.

Fairbairn: Right.

Chiang: And that help a lot.

https://archive.computerhistory.org/resources/access/text/2022/07/102792671-05-01-acc.pdf
   ____________________________________

 Morris Chang's Last Speech
 
https://interconnected.blog/morris-changs-last-speech/

Morris Chang's Last Speech

    Author and founder of Interconnected. See "About Interconnected" for more information.

    More posts by Kevin Xu.

Kevin Xu
12 Sep 2021
English
中文

Today’s post is the translation of a speech Morris Chang delivered on the history and future of TSMC and the semiconductor industry at large in April. Chang is the founder and two-time CEO of TSMC, now 90-years-old and retired. The audience of the speech was Taiwanese government officials and business leaders. (See full video of original speech here.)

I wrote a tweet thread and full analysis of this speech in May, specifically on what Chang thought was the future competitive dynamic between TSMC/Taiwan, the US, China, and South Korea. (Spoiler alert: Chang believes Samsung of South Korea is the most fierce competitor of TSMC.)

    Morris Chang, the now 90 years old founder of TSMC, gave a speech (in Mandarin) last week (ht @ruima)

    Among other things, he shared personal views on Taiwan's advantages + sized up competition from 🇺🇸🇨🇳🇰🇷

    Thread of highlights + his slides in traditional Chinese👇 pic.twitter.com/SWaKHpARua
    — Kevin Xu (@kevinsxu) April 27, 2021

But there is so much more to this hour-long, exception-worthy speech, because Chang is the only person among the “founding fathers” of semiconductor technology still alive and lucid. Gordon Moore is alive, but as Chang noted in his speech, in poor health and retiring in Hawaii. Both Jack Kilby and Bob Noyce have passed away. All of these industry luminaries are Chang’s contemporaries, with whom Chang has gone to conferences in their younger days -- sharing dreams and ambitions over beers. Given how crucial understanding semiconductors is to the future of our world -- technologically and geopolitically -- it’s worth learning from one of the people who started it all, unfiltered.

In this translation are also screenshots of the slides (in traditional Chinese) Chang used during his speech. Just like what I did with our translation of Zhang Yiming’s last speech, I’ve bolded noteworthy phrases and passages throughout. I hope you enjoy reading and learning from it.
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First of all, thank you very much, President Huang and Editor-in-Chief Fei of the Economic Daily News, for giving me this opportunity to speak on a topic that I have felt is very important in the past year or two. I would also like to thank all the distinguished guests who have come to speak here, Chairman Mark Liu and President CC Wei of TSMC, all the distinguished guests who have come to listen, and friends from the media.

Ladies and gentlemen, the title of my speech today is "Cherishing the Advantages of Taiwan's Semiconductor Wafer Manufacturing", and this speech is an appeal from me to the Taiwanese government, Taiwanese society, and TSMC.

My status is a TSMC retiree, and I no longer have any authority inside the company, which is my choosing, so TSMC is also a very important audience of what I’m advocating for in my speech today.

Because I already know that the vast majority of the audience is not in the tech community, much less the semiconductor community. So I would like to talk a little bit about the history of semiconductors, otherwise jumping straight into the key point —— the advantages of Taiwan's semiconductor wafer manufacturing —— might be too confusing.

This is the PowerPoint I made today. The first chapter starts with a brief history of semiconductors; the second chapter talks about the importance of semiconductors and why they have become a must-have for politicians and geopolitics. Then I will talk about the division of labor in the semiconductor industry. If it were not for this division of labor, we would not have the problems we have today. This division of labor started decades ago.

The fourth chapter will be the main topic - Taiwan's advantages in wafer manufacturing; the fifth one will be the fab-centered semiconductor industry chain, because the impact of wafer manufacturing on Taiwan is definitely not only on TSMC. TSMC’s wafer manufacturing has also driven a lot of other upstream, downstream and midstream industries.

Sixth, I’ll talk about the founding of the professional wafer manufacturing industry, that is, the founding of TSMC. This took people, opportunities, and a bit of luck or coincidence to happen (风云际会). It’s very rare so I think it’s hard to produce even one example from an entire generation. Seventh, TSMC's success; eighth, TSMC's status today; in the ninth, tenth, and eleventh chapters, I want to look at our foreign competitors, the United States, mainland China, and South Korea. These three are the most important competitors, although, of course, there are also Japan, Europe. However, because my topic today is wafer manufacturing, comparatively speaking, the United States, mainland China, and South Korea are our important competitors.

Finally, the twelfth point, since now people often say, "ah, we can have another so-called 'protective mountain of the nation'” (护国神山, i.e. an industry or company as influential to Taiwan as TSMC), I also want to talk about the possibility of producing the next "protective mountain of the nation." And lastly, the conclusion.

A Brief History of Semiconductors

The conductivity of a semiconductor is between that of a conductor (metal) and an insulator (wood). You can control the conductivity of the semiconductor. In short it is between metal and wood, so we call it semiconductor.

But honestly, until 1948, semiconductor was a term only known to scientists. Ordinary people, those who majored in liberal arts, business, or law didn’t know what it was. Only scientists, especially physicists, knew. So it was a very small group in society back then.

In 1948, a major event in the semiconductor industry took place. AT&T, at that time the largest telecommunications company in the United States, had Bell Labs under it, which was a world class research institution for many decades. There were three physicists at Bell Labs. Shockley was their leader, and Bardeen and Brattain didn't really like him, but the three of them collaborated to invent the transistors, which were based on semiconductors. What they invented was very important, and that was the transistor.

What is important is that it (semiconductor transistor) is very small. Prior to its invention, vacuum tubes could be used to make transistors, but vacuum tubes are big. During the Second World War when the United States began to manufacture computers, a computer was so large in size, because of the use of vacuum tubes, that it could occupy an entire room.

I came to the United States in 1949, and didn't see any computers the first year I was there. I was at Harvard, and the place where the computers were was far away from my freshman dormitory, so I didn't go. The next year, in 1950, I went to MIT, saw a computer, and learned to code. The computer was full of vacuum tubes, occupying the whole room. Honestly, the functionality of a computer as big as a room was not as powerful as the cell phone you are carrying today.

But anyway, the transistor was invented in 1948, and AT&T knew how important it was. These three physicists —— Shockley and Bardeen were theoretical physicists and Brattain was an applied physicist —— won the Nobel Physics Prize for transistors in 1956, pretty soon after the invention. Bardeen went on to win a second Nobel Prize, but that's not relevant to our topic today.

Shockley was born in the same year as my mother, and I was his student at Stanford University, where I listened to his lectures. He was a good lecturer, but the most memorable thing was his arrogance. Many students, including me, were afraid to ask him questions because when we saw other students asking him questions, the first thing he did was not to answer the question, but to taunt the student, looking down on him for asking a simple question and saying that his question was really ridiculous. In such a situation, few students dared to ask him questions and just listened to his lectures.

In 1952, AT&T knew that one company could not monopolize the transistor because it was too important for the future, so it licensed the technology to many companies, including IBM and Texas Instruments (TI). Many companies began to produce it, dozens of companies, including such large companies as GE. IBM was already quite big, but GE and RCA were even bigger than IBM. At that time, TI was a very small company, but it was also a licensee. It would become the most successful one in later decades to come.

After that, computers and semiconductors began to develop in parallel, because computers needed semiconductors the most.

I joined the semiconductor industry in 1955 after receiving my Master's degree from MIT. The history of semiconductors was irrelevant to me until 1955, and after 1955 the history of semiconductors merged with my life story.

In 1958, I had just arrived at TI. A new colleague of mine, who, like me, had just joined TI, was Jack Kilby. He was eight years older than me, but we were contemporaries. He was working on integrated circuits, which the chairman of TI asked him to do.

Jack Kilby was a very innovative person. His education level was not high —— only Master’s and no PhD. If you talked to him about theoretical physics, he wouldn’t understand it, but he was innovative. He insisted that he was an engineer, and whenever someone said he was a scientist, he would immediately deny it and say, "I am an engineer". He later invented the integrated circuit, which happened under my eyes.

That same year, Bob Noyce (or Robert Noyce) was at Fairchild, and I had just met Bob Noyce at that time. We were together at the Washington IEDM, a technical conference held in Washington every December. Noyce and Gordon Moore, who I will talk about later, were at Fairchild. I had already joined TI at that time, and I had just joined. We were quite gentlemanly at the conference together, and not aggressive with each other yet.

After the meeting, Noyce, Moore, and I went out for a beer in the evening, and at that time I was only 27, Noyce was only 31, and Moore was only 29. We were all young and excited, and thought we were the “Favored Children of Heaven” (天之骄子, i.e. children of destiny), lucky to have joined the promising field of semiconductors. After drinks and dinner, we sang our way back to the hotel from the restaurant amidst the snow drifts.

Both of them, Kilby and Noyce, invented the integrated circuit almost at the same time. In fact, Kilby was a little earlier, about a month or two earlier. But honestly, although Kilby's was a little earlier, Noyce's was a planar construction while Kilby's was a bonded construction. Without Noyce's planar construction, integrated circuits would not have been made.

Later, after some legal disputes in the court or something, both sides —— TI and Fairchild —— settled, saying that the two people jointly invented the integrated circuit. Noyce unfortunately passed away very early, in 1990, at the age of 63. He lived a full life: had a lot of girlfriends, often flew his own plane, went diving and swimming, and played many other sports.

I think the next important thing (in semiconductor history) was Moore’s Law in 1965. Moore, at Fairchild, predicted that circuit density would double every 1.5 - 2 years, a prediction that came to be known as "Moore's Law" and remained quite valid until recently.

It’s been decades. Although Moore's Law is only a prediction, it has forced every company to double the circuit density every year and a half to two years, because by then the semiconductor industry was no longer gentlemanly —— companies already became aggressively competitive —— and everyone thought, “If I don’t double it, my competitors will.” So they tried their very best to do so. This was the important thing about Moore's Law. It was at first only a prediction, which might not have been true. In fact, if MOS (metal–oxide–semiconductor) was not invented, or I should say made practical, since it had existed, Moore's Law would not have been accurate. That was after Moore's Law was published, in around 1968, 1969.

Almost ten years ago, IEDM —— the same conference that I went to 50 years ago and sang my way back to the hotel —— invited me to speak on the biggest semiconductor innovations. I then put transistors and integrated circuits in the speech. I also put Moore's Law in it, because of what I just said, the pressure (to double the circuit density every 1.5 - 2 years). I also put MOS in it. MOS allows us to (let the circuit density) double, double, and double again. Lastly, I included chip foundry in the speech —— it was also listed as one of the important innovations in the history of the semiconductor industry.

From the 1980s to the present, semiconductor applications expanded rapidly, mainly PCs, and later, of course, cell phones etc. Why do I talk about the year of 1980? Because 1980 was when IBM released its PC, which universalized PCs. IBM was a big company at that time, so when people saw that IBM released a PC, they saw the PC as a legitimate thing, not just a toy. Before IBM, Apple and several small companies already came out with PCs, but people said, “hey, this might just be a toy.” IBM’s PC release in 1980 changed this notion.

Especially in the 90s. In the 80s, IBM came out and PCs became prevalent in the office, but in the 90s they became prevalent at home. Even housewives used them. I personally experienced this history and so had a deep impression of it. The 90s was also Andy Grove's era. Everyone always thinks that he is Intel's best, greatest CEO ever. This is really a case of, “Our times shape our heroes. Our heroes shape our times” (时势造英雄，英雄造时势). The 90s was the era of very rapid PC adoption, and Intel was almost exclusive in making processors, so the situation made Andy Grove a hero.

In 1987, Morris Chang established TSMC in Taiwan with a new business model, specializing in wafer manufacturing services. This was a disruptive innovation that disrupted the semiconductor industry, and I'll explain why in a moment. In 2020, TSMC became the world's largest semiconductor company by market capitalization.

Intel was the dominant player in the world's semiconductor industry for decades, from the late 1980s until recently. TI's period of dominance was from the 60s to mid-80s. Last year, TSMC reached its highest market cap at $600 billion, when Intel had just over $200 billion, less than half of TSMC. However, what will happen after this is not certain.

In 2021, Intel, the former dominant player, announced that they are also going to provide wafer manufacturing services. This is quite ironic to me. Originally they were the dominant player, and frankly they looked down on wafer manufacturing, thinking that this thing couldn't do much. I was acquainted with them, so at first I sought investment from Intel. At that time, in 1985, TSMC was raising capital, but the timing was not right and the economy was not good, so Intel refused to invest.

However, after TSMC was established, Intel, Andy Grove, and Gordon Moore helped a lot, but they never thought that this foundry business model would become so important; nor did they ever think that one day they would also do wafer manufacturing. Of course, Gordon Moore is now in very bad health and lives on Big Island, Hawaii. Noyce, as I just said, has died, and Andy Grove has also passed away.


I’ve talked about history for a long time, so now we can go a little faster. The importance of semiconductors can be first of all seen in national defense: missile navigation, GPS, this is another small story.

Now we are very familiar with GPS because all the cars have it. The first time I heard about GPS was at TI. I had top-secret clearance at TI, and was in charge of semiconductors. TI had a defence system division and they needed integrated circuits to do GPS to navigate the missile. I heard them talk about it and thought that it was super cool, “how can it hit within 5 ft diameter of a target from thousands of miles away?” This was in the 70s. Now every car has GPS.

Semiconductors are ubiquitous now, in commerce, industry, and daily life, from computers to cell phones. And of course, Covid19 has accelerated the global digital transformation.
Division of Labor in the Semiconductor Industry

Originally, when I first joined the semiconductor field in 1955, there was no division of labor in the industry. Every company did everything by themselves. They did IC design —— sorry, there was no IC in 1955. It was transistors, but a few years later there would be IC. IC design needed design tools, but each company would do it on their own. Design is actually quite technology-intensive, the added value is also quite high, but it’s not so capital-intensive, so it doesn’t require a lot of capital. Process R&D and wafer manufacturing are capital-intensive, technology-intensive, and have high added value. The technology and capital required for packaging & testing are not as intensive as that for wafer manufacturing. Compared to IC design, packaging & testing is more capital-intensive but not as technology-intensive. In short, every semiconductor company did its own thing.

The division of labor can be said to have begun in the 1960s and the first to have been separated out was packaging & testing. Companies often still did it themselves, but in low-wage areas, such as Taiwan, the Philippines, Singapore, Hong Kong (Hong Kong was where they started), and even Japan. In the 60s, you know that Japan's wages were only 5% of that in the United States. At that time, I suggested that TI come to Taiwan, and the CEO of TI said, "Let's go to Japan, because the salary in Japan is only 5%. In Taiwan it’s only 1%, but the difference between 1% and 5% is not big.” However, I told him at that time that Japan's wages would rise quickly, while Taiwan's wages would not rise so fast, so he came to Taiwan. This is just a small anecdote.

In short, packaging & testing in the 60s was at first not technically separated out, but done by individual companies in low-wage regions. However, in low-wage areas, you couldn’t lock up the market and have it all to yourself. Low-wage areas also had entrepreneurs. And regardless of whether you were TI or Motorola, they saw that you engaged in packaging & testing here. They knew that this technology was not that difficult, so they would open companies that had lower overhead than you and would say, "hey, you should let us do it for you". That’s why there are a lot of packaging facilities in Korea and so on.

It was like that in the semiconductor industry till 1985. I was in New York at General Instrument then. Gordon Campbell was a pretty famous entrepreneur who had founded a semiconductor company that was quite successful. In 1984, he had just sold it and wanted to build a new company. I didn't really know Gordon Campbell, but I knew his name, and he knew my name. He said, "I'm hoping that you and General Instrument can invest [in my new company]. Can you come and take a look?”

So we made an appointment, and he came to see me and said he needed $50 million. I said, "Do you have a business plan?" He said, "The business plan is all in my head.” Then I said, "Even if I want to invest in your company, I have to report this to General Instrument's board of directors. There must be a business plan.” He said, “No problem, no problem Morris. I'll send it to you in two weeks.”

He went back —— he was in California while I was in New York —— but 3 weeks passed and nothing happened. I was actually quite interested, so I called him. He said, "I'm sorry Morris, I didn't contact you again because I don't need 50 million anymore. I just need 5 million, 5 million is enough, and I can get that together myself. ” When I asked why, he said, “I’m not going to do wafer manufacturing —— that is capital intensive —— I will just build a design company.”

This was the first time I had heard of a company specializing only in design. Of course, the complementary part of that is wafer manufacturing: since there are companies specializing in design, there can also be companies specializing in wafer manufacturing. It took me a year to figure out this complementary model, which became TSMC. Anyway, I originally thought this speech would be too short, but it seems too long now.

Why is this business model so disruptive? Because process R&D and wafer manufacturing are in fact the heart of the so-called IDM (integrated device manufacturer). Packaging & testing can be separated out, but process R&D and wafer manufacturing are at least part of the heart, the other part being IC design.

TSMC's business model is that semiconductor companies are our customers, our friends. This is the biggest discovery of this business model. The biggest discovery of a business model is who your customer is and how you make money. Since our customers are semiconductor companies, if they originally make their own wafer but now we make wafer too, then our competitors are those in charge of wafer manufacturing inside semiconductor companies. That's why it's very disruptive. You young listeners haven't experienced this kind of corporate politics —— this is very disruptive.
Taiwan’s Advantages in Wafer Manufacturing

First of all, we have talent, a large number of excellent and dedicated engineers, technicians, operators willing to commit to manufacturing. This is very important. At least in the United States, engineers are not as dedicated as those in Taiwan. I think people in other professions as well, haha. Americans are not as dedicated as Taiwanese.

So what I want now are excellent and dedicated engineers, technicians, and operators, all of whom are important and need to be willing to commit to the manufacturing industry. Manufacturing in America is no longer a “hot” industry. It has not been “hot” for decades. People don’t want to work in the manufacturing industry. There are a lot of nerds doing R&D; there are a lot of people in the financial sector —— engineers etc. can also be in the financial sector and do venture capital and private equity. There are also many people doing marketing. All of the above (i.e. R&D, finance, marketing) are more desirable fields to be in than manufacturing. The commitment to manufacturing is a great advantage of Taiwan.

Secondly, our managers are Taiwanese. In Taiwan they’re the best, but they may not be the best when working overseas. So is the reverse —— my own experience demonstrates this. I worked for two or three decades in the United States to reach the level just below the CEO of a large company, but coming back here to Taiwan, even managing teams of a much smaller scale messes up my brain. Culture, habits, and language are all different. Although I had been speaking Chinese till I was 18, 36 years of not using it made it a problem for me to speak it again at the age of 54. I’m afraid it’s probably still a problem today, haha.

Another advantage Taiwan has is its convenient high-speed rail and highway transportation system, which makes mass manufacturing personnel movement easy. TSMC's three manufacturing centers —— Hsinchu, Tainan, and Taichung —— often have thousands of engineers whose location assignment changes but who do not have to move their family. They can be transferred from Tainan to Taichung, or Hsinchu to Taichung. The time from Tainan to Hsinchu is a little longer, so that’s not a one-day commute anymore, but the commute between Taichung and Tainan, and Hsinchu and Taichung, are within a day. Even when transportation is convenient, TSMC also has dormitories so that engineers can have a place to stay during the week and go home on weekends. They don’t have to move their whole family when their new assignment is often only a year. How do you do that in Arizona?
Fab-Centered Semiconductor Industry Chain

Okay next slide. TSMC is definitely not the only company in the industry. There are design companies like MediaTek —— perhaps the largest among all but there are many more. Midstream in the industry chain are Taiwanese equipment manufacturers: silicon wafers, gas suppliers, raw materials and so on. There are also important global semiconductor equipment vendors, such as ASML, Applied Materials, LAM Research, etc. all of which have service bases, training centers, and R&D laboratories in Taiwan. They are brought here by TSMC. Of course, I’m talking about TSMC today, but there are other wafer manufacturing companies in Taiwan besides it. Downstream are assembly and testing companies, so there is a fairly complete industry supply chain in Taiwan.
Origin of Professional Wafer Manufacturing

How did the professional wafer manufacturing model come about? It was a coincidence of events, places, and people in 1985 (风云际会). The “event” was the VLSI program of ITRI (Taiwan’s Industrial Technology Research Institute), which had been in operation for ten years at that point, and frankly speaking, it was at the end of its rope. It needed a lot of funding every year, but whenever it tried to do some small business, people would say that it was competing against the people of Taiwan for profit.

At the beginning, its technology was only one generation behind the world's most advanced technology. ITRI took RCA’s technology in 1975, but RCA itself was not first-class at that time, so the technology ITRI brought back was already behind. After ten years of working on it, the gap became even bigger. They were then two or three generations behind. It also cost quite a lot to employ hundreds of people. If it did some small business, it was accused of competing against the Taiwanese people for profit.

So Mr. Li Kwoh-ting wanted to find a way out, and I took advantage of that opportunity. This was definitely not hitchhiking. The foundry model was the world's first. Although the upside was that there were no competitors, the downside was that there were no customers either. I’m not going to talk about this today.
TSMC’s Success

Why did TSMC succeed? What are the factors behind it? The most important factors are what I’ve just talked about: Taiwan’s advantages in wafer manufacturing.

Of course professional managerial leadership is important too. I think TSMC is the largest company in Taiwan and led by professional managers, everyone from the chairman down. Of course, there are disadvantages as well, but I do think that to set up a world-class enterprise, deploying a professional managerial leadership is still a better model.

We have been investing in R&D for a long time as well. This is what we’ve done and important for our success.

We’ve also had 120,000 employees since our founding, including those who have left. This actually indicates a very low turnover rate, only about 3%, 4%. We currently have 50,000 employees and have only had 120,000 employees in total for the past 30 years.

Of course, the support from the government and society at large is very important to TSMC’s success as well. This is what I’m calling for today. I hope they will continue to support TSMC and increase the advantages of Taiwan.
Status of TSMC Today

TSMC’s status today is the leader in semiconductor manufacturing technology.

The semiconductor market was $476 billion last year, of which memory chip was $117 billion and logic chip was $359 billion. About a quarter of that, actually just a quarter, was made by TSMC.

Almost everyone in the developed world, about 2.5 billion people, uses semiconductor products made by TSMC in their daily life or work.

For example, I actually wear a hearing aid, and I recently discovered that the integrated circuits inside the hearing aid are also made by TSMC.

Every 3 years, the hearing aid salesman comes over and tells me about the new model and asks me to buy another set. I always asked him what the benefits of the new model were, and he said a bunch of things, and then he told me that the ICs were replaced so they would function better. I actually listened to him and bought 3 or 4 of them.

Although the integrated circuit has improved over the generations, it doesn't seem to help the function of the hearing aids much, to be honest. It's kind of like the American cars, with new models every year.
The US Subsidizing Semiconductor Manufacturing

Now let’s look at the countries we are competing against. The United States is the most powerful, with its subsidies.

Comparing the American wafer manufacturing conditions with Taiwan, land is America’s absolute advantage. So are water and electricity. However, Taiwan’s advantages that I just talked about are America’s weaknesses.

American talents are not as good as Taiwanese ones, whether it’s engineers, technicians, foremen, or operators. The personnel dispatched by Taiwan to the US, like I said, are not necessarily the best in terms of management ability. The US also lacks the ability to mobilize manufacturing personnel on a large scale.

The result is that the unit cost is significantly higher in the US than in Taiwan. It’s true that it has subsidies. The US has both the carrot and the stick, with the former being federal and state government financial subsidies. However, short-term subsidies can not make up for its long-term competitive disadvantages.

The subsidies only last for a few years, but you still have to keep going after those years.
Competition from Mainland China: After 20 Years and Tens of Billions in Subsidies

Next, competition from mainland China. After 20 years and tens of billions of dollars in subsidies, semiconductor manufacturing in China is more than 5 years behind TSMC. Logic semiconductor design is 1-2 years behind the United States and Taiwan.

Mainland is not yet a rival, especially in terms of wafer manufacturing.
Competition from South Korea: In Wafer Manufacturing, Samsung Electronics is a Strong Competitor

As for South Korea's competition in the field of wafer manufacturing, Samsung Electronics is a strong competitor of TSMC.

Why? Because the advantages of South Korea in wafer manufacturing and Taiwan are similar, from talent to the ease of transporting personnel, since Samsung’s factories are all in one place.

Its managers are also Korean, first-class in South Korea but not necessarily abroad.
Taiwan’s Next “Protective Mountain of the Nation”

Some people are now saying that we have a "protective mountain of the nation". If the definition of that is an industry that is important to the world and Taiwan has a high market share, then you need to find an industry where Taiwan has potential advantages and it’s important to the world.

Otherwise, Taiwan only has 24 million people and is a small place. I found wafer fabrication as a protective mountain of the nation, but I have not found a second one, and I have been searching for decades.

Then the next "protective mountain of the nation" needs to have an innovative product or business model, like wafer manufacturing/foundry, which was a new business model.

Then you also need many years of effort and business operations.To answer this question, my answer is: difficult!
Conclusion

Semiconductor wafer manufacturing is an important industry that impacts people's livelihood, economy, and national defense. It is also the first industry in which Taiwan has gained considerable advantages in world competitiveness. These advantages are not easy to obtain or keep. I hope that the government, society, and TSMC itself will make efforts to protect them.

This is my appeal to you today. Thank you.

https://interconnected.blog/morris-changs-last-speech/


source:
christopher miller (author name), chip war (book title), 2022
 
p.412
https://interconnected.blog/morris-changs-last-speech/

https://archivereadingroom.blogspot.com/2023/08/morris-changs-last-speech.html
https://archivereadingroom.blogspot.com/2023/08/
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