Chip War - Chris Miller

I took modules in semiconductor and very large-scale integrated circuit (VLSI) during university days. I understood semiconductor theory well, but generally ghost through VLSI. The best students got jobs in the semicon industry, such as with Intel, who would pay up to RM 4K in 2010. I joined a power plant, who paid around RM 2.3K (which was relative, as I was bonded. They had sponsored my studies for 5 years). Still, the brightest electronic engineers went to Singapore or Penang.

A colleague (specialist in semiconductor risk) introduced this book to me, and as a trained electrical engineer, I could recommend this book more. 

Credits to NLB for this book

The founders of Silicon Valley (in the 60’s) were physicist and electronic engineers, who were scientists at core.

It was inspiring reading about people like Gordon Moore (CEO of Intel, famed for his 1965 Moore’s Law), Morris Chang (ex-Texas Instruments and founder of TSMC), Akio Morita (co-founder of Sony, which in the 80’s invented the Sony Walkman), Robert Noyce (co-founder of Fairchild Semiconductor and Intel), Ren Zhengfei (founder of Huawei), Jay Lathrop (co-inventor of photolithography) and other titans of the semiconductor industry.

In 2023, we talk about tech giants like Microsoft, Google, Amazon and social media platforms like Facebook, Tik-Tok (which I don’t have an account), etc. All of these require computer and processing power, originating from a chip. Those days, semiconductor makers were the tech millionaires, and they were mostly located in Silicon Valley or in Texas.

The book gives a fun and interesting story of how a potato chip maker (Jack Simplot of Idaho) invested in semicon chip manufacturing. He would later found Micron, one of the only remaining (important) American chip maker left. Micron focused ruthlessly on costs because it had no choice. Survival was a real struggle (against the Japanese and Taiwanese fabs).

Japan was an early beneficiary of outsourcing and globalization. They started off by manufacturing simple electronics due to low labor cost. Gradually, the Japanese got better, and in the 80’s actually challenged the US in terms of productivity and efficiency. Companies like Sony and Toshiba made consumer electronics (like Walkman) that were sold globally.  Japan’s industry became so influential that the US started a mini-trade war with them, and regained some control in the 90’s, after the Iraqi war. The 90’s was when the US ran the (unipolar world), after the collapse of Soviet Union.

This book tried to explain that semicon was also one of the reasons of US winning the Cold War. The Soviets did try to ‘copy’ the technology, and even set up a city – Zelenograd (green city in Russian), but failed. Using silicon chips, the Pentagon learned about the power of precision weapons – using electronics to guide missiles on a target, rather than using mechanical dials, which were manual and have an extremely low. The Vietnam War was a lesson learned – You can drop tones of bombs, but if it doesn’t it the target, you still lose. Might for might, bombs to bombs, the USSR could match the US. But with US pulling ahead with high-tech bombs, the USSR did not stand a chance.

In the 70’s, due to globalization and better bottom lines (yes, Wall Street), fabs started being outsourced to East Asia, where governments welcomed with tax breaks and subsidies. China was marred in the Cultural Revolution during the final days of Mao Zedong. Taiwan, South Korea, Singapore and Malaysia (Penang) started their electronics industry, and till today still play an important role. The Covid pandemic cause disruption in world supply. 

Some companies started off ‘fabless’ – Qualcomm, Apple and the likes didn’t need to have a fab (which produces chips). They design their chips and outsource it to TSMC, Samsung and Micron.

In Europe, a company called ASML became the leader in lithography, a tool that used extreme UV (EUV), with a wavelength of 13.5nm to carved features into chips. I understand that the most advance chips today is at 7nm. ASML’s tools cost 100 million dollar a set, with technical support and on-site engineers.

The center of this book, which most people are interested is the rise of China. The Chinese government treated semiconductor as a military necessity. They provided grants, subsidies and sometimes strong-arm tactics to request technology transfer.

Huawei was an electronics trading company in the 80’s, just like how Samsung started as a dried-fish seller. Huawei rose rapidly, pouring billions in R&D, and was alleged to have stole technology, something they admitted during the early days. They were poised to install 5G systems globally, a threat to US security. The US didn’t want the Chinese government to spy on others, something that the US has been doing all these while. The US banned export of semicon technology to Huawei and Android stopped supporting Huawei phones. The rest is history.

From the last days of Obama, Trump and now the Biden government, more restrictions are imposed in selling high tech equipment and advance chips to China. This could slow down the rise in China’s rise in the technology/military space, but it may act as a catalyst for China to double down in their efforts to develop their own technology. Alas, companies like ASML had toil for 3 decades, and by the time China achieves what ASML has today, say in 5 years, ASML would have gone ahead with the latest tools.

Taiwan’s TSMC supplies 30% of global chips. The current Taiwan Straits is rather delicate. It is in everyone’s interest to have a peaceful Taiwan Straits.

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As an electrical engineer, I appreciate this book very much. This is real engineering and what real engineers do.