“Uneasy lies the head that wears the crown”
– Founder of TSMC
Morris Chang is both proud and uneasy about Taiwan Semiconductor Manufacturing Company (TSMC), the company he founded in 1987 that has become the undisputed world leader.
To describe his feelings, he likes to quote a phrase from “King Henry the Fourth” by William Shakespeare, one of his favourite authors -- “Uneasy lies the head that wears the crown”.
“To become the leader is not easy to do. As Shakespeare says, the crown is very heavy,” he said at the publication of the second half of his autobiography in Taipei last month. “(Donald) Trump did not name TSMC directly, but said that Taiwan companies stole the chip business from the U.S.”
In his desire to bring the chip industry back to the U.S., what measures would Trump take against producers in Taiwan and other foreign countries?
The Commonwealth magazine of Taiwan published the autobiography. Chang released the first part 27 years ago, recounting his early career with Texas Instruments and the foundation of TSMC. The second part traces his leadership of TSMC to its current global prominence until his retirement in 2018, after 31 years as its head. In the initial run, Commonwealth printed 140,000 copies, compared to the average initial printing of a book of 3,000 copies.
In 1993, TSMC was listed on the Taiwan Stock Exchange. In 1997, it become the first Taiwan company to be listed on the New York Stock Exchange.
On December 10, it released net revenue for the first 11 months of 2024 -- NT$2,616.15 billion, an increase of 31.8 percent compared to the same period in 2023.
The book revealed that, in 2013, Chang invited Nvidia CEO Jensen Huang to join TSMC. After the 2008 financial crisis, Nvidia’s market value had fallen to US$9 billion and its stock price to US$1.55 due to weak demand for personal computers. Huang was so dejected that he did not want to get out of bed or leave his house.
Huang declined the invitation, saying that he already had a job and that his ownership of 7.5 per cent in Nvidia would pose a conflict of interest. “I admire Huang’s visionary leadership and professionalism,” said Chang. “He is one of the second generation of semiconductor leaders who prioritise design and computer science over manufacturing.”
Since then, Nvidia has never looked back. It is one of the world’s leading suppliers of AI software and hardware. In one day in June 2024, it overtook Microsoft as the world’s most valuable publicly traded company, with a market capitalisation of more than US$3.3 trillion.
The book describes Chang’s relationship with his two biggest rivals – Intel and Samsung – whom it has defeated in the market.
He said that he had a good relationship with the three founders of Intel – Robert Noyce, Gordon Moore and Andy Grove but not with Pat Gelsinger, who took over as CEO in 2021. “His communication skills outweighed his strategic vision. He was hostile to TSMC.
“Intel’s Achilles heel is the lack of a new strategy and a problematic switch a wafer foundry services. This is leading the company to miss out on AI business opportunities. It has not developed a new strategy and is searching for yet another CEO,” he said. Trump wants Intel to the U.S. national champion in the field of semiconductors, and one other major American firm in this sector.
On Samsung, Chang said that its strategic flaw was technology rather than leadership or administration. “South Korea’s recent political instability is a further impediment to its operations.”
Chris Miller, author of “Chip War” said that, despite its poor performance, Samsung remained committed to its foundry operation. Given the influence of the founding family and the company’s complexity, Samsung was likely to continue investing in foundry, even it was not immediately profitable, he said.
He said Intel was likely to receive future U.S. support, such as it has already received through the CHIPS Act and the “Secure Enclave” programme.
One possible threat to TSMC is an anti-trust investigation because of its dominant market position, Miller said. “It is hard to find a trillion-dollar technology that has not faced anti-trust scrutiny, such as companies like Microsoft, Google and Nvidia, We should not be surprised if TSMC faced a similar set of questions.”
TSMC has taken a giant step to meeting the nationalist demands of Trump by a planned investment of US$65 billion in three semiconductor plants in Phoenix, Arizona. Of this, the U.S. government is providing US$6.6 billion in grants and US$5 billion in loans.
This should make Chang’s crown a little lighter.
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