Trump's Successful Re-election... Growing Expectations for Major AI Regulation Easing
Trump's Ambition for Space... Musk Possessing Both AI and Space
With Donald Trump winning the U.S. presidential election, the response of Silicon Valley tech companies is drawing attention. Notably, the number of tech figures supporting Trump is the highest ever recorded.
The most prominent figure in the industry is Elon Musk. Musk is expected to take charge of the Government Efficiency Committee and expressed a welcoming stance after Trump's victory, saying, "Morning has come again in America." Musk has already shown a pro-Trump inclination by restoring Trump's account and actively promoting it after acquiring Twitter (now X).
The space industry is expected to see the biggest changes. Trump directly mentioned SpaceX and Starlink in his victory speech. Cooperation with the Space Force, established during the Trump administration, is likely to be strengthened, and SpaceX's role in Mars exploration projects is expected to expand. The fact that using Musk's rockets can significantly reduce costs is drawing attention.
Significant changes are also anticipated in the AI sector. Musk's xAI currently possesses 100,000 to 150,000 NVIDIA H100 GPUs, making it the second-largest scale after Meta's 300,000 units. Jensen Huang, NVIDIA's CEO, praised xAI for completing the installation of this massive GPU cluster in just a few weeks. Meta is expected to become the 'Android' of the AI field based on its current GPU holdings.
Unlike the Biden administration, which strengthened AI regulations, Trump is expected to pursue a deregulation approach. At a recent AI safety conference held in the UK, Musk criticized government regulatory attempts, pointing out that they could hinder development. This stance aligns with the Trump administration's policy direction.
Big tech leaders who previously opposed Trump, such as Meta's Mark Zuckerberg and Amazon's Jeff Bezos, have also expressed welcoming views. The Washington Post did not endorse any candidate, which is analyzed as reflecting the interests of Amazon's AI business through its cloud operations and Bezos's space company Blue Origin.
Signs of change are also emerging in the semiconductor industry. TSMC has been pushing to establish factories in the U.S. since Trump's first term. Recent reports indicate that the efficiency of U.S. factories surpasses that of Taiwan, presumably due to technology transfer by Taiwanese employees. It is increasingly likely that major clients such as NVIDIA, Apple, and AMD will produce their volumes domestically in the U.S.
For Korean companies, strengthening competitiveness in the memory semiconductor sector has become crucial. Samsung Electronics and SK Hynix are focusing on developing HBM (High Bandwidth Memory). SK Hynix Chairman Choi Tae-won emphasized the importance of HBM at the AI Summit, stating, "The bottleneck lies in HBM." Without HBM, neither TSMC's packaging nor NVIDIA's AI chip production is possible, highlighting the importance of Korean companies' position.
In the foundry sector, a realistic approach is needed. It is analyzed that Samsung Electronics' goal to become number one in foundry or Intel's goal to become number two is realistically difficult to achieve. Instead, leveraging strengths in memory semiconductors is considered important.
Responses to the intensifying U.S.-China conflict are also necessary. Compared to four years ago, Singapore has seen large-scale factories from companies like Micron and Applied Materials established. Malaysia is also actively fostering its semiconductor industry. Cooperation with ASEAN regions, including Vietnam, is becoming increasingly important.
Trump's pledge to impose up to 60% tariffs on China raises concerns. However, experts predict that since this term is Trump's last, the situation will differ from his first term. Although he may take a tough stance initially, it is analyzed that he will seek compromises as his term progresses.
In conclusion, Trump's return to power is expected to bring widespread changes to Silicon Valley and the global tech industry. Deregulation and increased government support are anticipated in AI and space industries, while the semiconductor industry is likely to see accelerated reshaping of supply chains centered in the U.S. Korean companies will need flexible strategies that leverage their strengths while exploring new opportunities amid these changes.
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