[Initial Moment] The Silicon Shield Was Solid

Reporting from Taiwan's High-Tech Industry Sites
Severed Diplomatic Ties and Geopolitical Limits Foster Unique Vigilance
The Source of Growth for the Foundry Industry

TSMC headquarters located in Hsinchu Science Park, Taiwan (Morris Chang Building). (Photo by Kim Hyunjung)

"Please do not use any expressions that could infer someone's identity."

Most of the sources I met last month in Taiwan repeatedly requested anonymity. This was true for local Taiwanese as well as Koreans working in Taiwanese companies. Semiconductor companies, especially the global foundry leader TSMC, were even more difficult to access. Although I officially requested cooperation from TSMC’s PR team, the answer was a "polite refusal." After mobilizing various connections over two months and facing multiple rejections, I was able to secure a few sources.

Even retirees and those who had moved to other industries avoided contact with the media. A public institution official working locally in Taiwan stated, "(Taiwan’s high-tech companies) do not allow even 1% of contact, including current and former employees," and firmly added, "Even if the head of the institution or the ambassador comes, they cannot meet." He also said, "The advanced companies here should be seen as different faces of TSMC," and described TSMC as both Hoguk Shinsan (護國神山, the sacred mountain protecting the nation, a respectful term for TSMC) and Hoguk Gunsan (護國群山). He explained that a tightly knit community difficult for outsiders to penetrate has been formed, and any deviant behavior outside this community is relentlessly tracked and stigmatized.

There were many difficulties even when visiting the 2nm (1nm = one billionth of a meter) semiconductor production site at Baoshan in the Hsinchu Science Park, specifically the Fab 20 construction site. The taxi driver found it unusual that a foreigner took a taxi early in the morning to a construction site next to the highway with no sidewalks. He showed discomfort, saying, "Even if you say you’re going, you can’t enter, nor can you stay in front of it." Despite the rainy and gloomy weather, the driver dropped me off about 1 km away from the destination. Taxi drivers in the science park often proudly talk about TSMC and Taiwan, but during the 30-minute ride to the site, he did not utter a single word on his own except to answer questions.

It was on the third day of reporting in Taiwan that I began to understand the unusually cautious attitude of Taiwanese companies and their representatives. The ten or so sources I met said this "vigilance" was the source of the establishment and growth of local companies including TSMC, and that the walls became even higher when the target was Korea. Rather than wondering why TSMC builds such walls, it is more reasonable to see that the geopolitical limitations of being an island nation with severed diplomatic ties to neighboring countries created these walls, and that TSMC was born as a result of this isolation. A social atmosphere and culture that includes reverence for engineers and respect for core industries?something "not found in Korea"?also formed the foundation.

Another background factor is the uniquely Taiwanese tendency to discuss business only after building rapport. Some companies that participated in last year’s semiconductor materials, parts, and equipment exhibition "SEMICON Taiwan" sighed empty-handed, saying, "We don’t know if we should come again next year," while others cheered, saying, "This place is half water, half fish." The difference lies precisely in whether or not relationships have been established, and the voices on the ground say Korea is still at the very beginning of this process.

TSMC is reportedly being considered as the acquirer of Intel’s foundry division, which once dominated the industry. Recently, it has proposed joint investments to Nvidia, AMD, Broadcom, and Qualcomm, seemingly recruiting a kind of "American alliance." At this point, is the concern that Taiwan’s solid silicon shield might shift from a defensive tool to an offensive one just an unfounded fear?