Mark Liu to retire from TSMC and adjustments hit the display industry
Hello everyone! This is Lauly from Taipei.
It’s been a while since my last newsletter, as I just recently came back from a two-month maternity leave. While I treasured the time spent with my little bundle of joy during my leave, I also missed the excitement of on-the-ground reporting on the tech industry. At one point, I was even anxious about building up a pipeline of stories after returning to work, but my dear colleague Annie Cheng Ting-Fang reassured me: “Don’t worry. You’ll be super busy when you are back. I guarantee you there will be no slow days for you.” And she was so right!
In the past month, we dug into the slowdown of Moore’s Law and what it means to the future of the semiconductor industry. While working on this big project, we also broke stories on Apple’s plans to move engineering resources for the iPad to Vietnam and its plans to introduce premium OLED displays for iPads and MacBooks.
Just when I thought we could slow down a little bit for the Christmas holidays, BAM! Mark Liu, chairman of Taiwan Semiconductor Manufacturing Co, the world’s largest contract chipmaker, announced he will retire next year. I was at a chipmaking facility builder’s earnings conference in Taipei with a lot of other reporters when the TSMC statement landed. We all immediately rushed out of the meeting room. A local reporter later told me that I looked like I had been struck by lightning.
2023 is marching towards its end, but the dynamism of the tech industry goes on. Many in the tech industry, like iPhone assembler Pegatron’s chairman, TH Tung, are hoping the headwinds of the past year or more will start to ease in the new year.
“Wars, pandemic, interest rate hikes . . . They all seem to be calming down a bit,” Tung told reporters on Wednesday. “With the stimulation from generative AI, electric vehicles and other technologies, we hope the tech industry could catch its breath in 2024 and even grow.”
Thank you for staying tuned with #techAsia in 2023. We’ll see you again on January 11, 2024, with even more great tech stories.
Un-Marked territory
Taiwan Semiconductor Manufacturing Co, the world’s biggest contract chipmaker, dropped a bombshell on Tuesday when it announced that its chairman will step down after the company’s shareholders meeting next June, Nikkei Asia’s Cheng Ting-Fang and Lauly Li write.
Chairman Mark Liu will retire from the company and exit the board, with TSMC chief executive CC Wei proposed as his replacement, according to the company.
Liu became chairman of TSMC after the company’s founder, legendary semiconductor veteran Morris Chang, retired in June 2018. The 69-year-old Liu has steered the chipmaking giant through several critical moments of the escalating US-China tech war, such as when it was forced to sever ties with major client Huawei Technologies due to Washington blacklisting the Chinese company.
“I now would like to give my decades of semiconductor experience to [an]other use, spend more time with my family, and start the next chapter of my life,” Liu said in the statement, without giving any details about what that use might be.
The unexpected announcement comes as TSMC is in the midst of its largest ever overseas expansion. Its Japan plant, the company’s first in the country, is scheduled to start operation next year, while its US plant — announced in May 2020 — will begin production in 2025 after the original schedule was pushed back. TSMC also announced plans this year to build its first plant in Germany.
Liu’s announcement also comes as the company pushes ahead with efforts to make ever more advanced chips, despite the slowing of Moore’s Law, which posits that chip power doubles roughly every two years.
A two-track mind
Japan’s Tokyo Electron has largely managed to offset the impact of controls on exports to China by expanding its sales of less advanced products to the country’s chip industry, Kana Inagaki writes for the Financial Times.
Asia’s largest semiconductor equipment maker has been navigating geopolitical tensions between Washington and Beijing with a two-track strategy of focusing on regulation-complying products for China while deepening technology development with cutting-edge clients in other key markets.
In an interview on the sidelines of the Semicon Japan trade show held in Tokyo this month, Junko Takagi, head of investor relations, said the impact from the Japanese and US export controls was “much smaller than expected”.
Takagi added that demand for less-advanced semiconductor equipment was “really big,” with Tokyo Electron generating 43 per cent of its revenues from China in the third quarter, compared with 24 per cent a year earlier.
The Tokyo-based company is a crucial player in the semiconductor supply chain, providing chipmaking equipment for industry leaders TSMC, South Korea’s Samsung Electronics and Intel of the US.
Browsers beware
The Philippines is emerging as Asia’s centre for online shopping scams, writes Nikkei Asia’s Ramon Royandoyan. Filipinos across the country have lost more than $2.8 million in shopping scams in the first nine months of this year, with some turning to victim chat groups on Facebook and other social media for support.
More than a third of Filipinos in a recent survey reported being scammed or encountering retail fraud online. The report was commissioned by the Global Anti-Scam Alliance (GASA) and Taiwan-based tech security company Gogolook and surveyed 20,000 respondents in 11 markets: Vietnam, China, Thailand, Hong Kong, Taiwan, Indonesia, South Korea, Japan, Malaysia, Singapore and the Philippines.
The report shows that the shopping scam rate in the Philippines led the group at 35.9 per cent, while South Korea had the lowest reported incidence, at 4.2 per cent.
The explosion in online shopping has created a lucrative market for scammers, while a lack of cyber crime awareness is aggravating the problem.
“Although [Filipinos] are considered very connected and digitally wired, [they] do not have adequate digital literacy skills,” said Mark Manantan, director of cyber security and critical technologies at the Pacific Forum in Hawaii.
Display adjustments
Taiwanese display maker AUO will shut down its production lines in Singapore by the end of this month due to continued weak demand for LCD screens, Nikkei Asia’s Lauly Li writes. AUO’s decision will affect up to 500 employees in the city-state.
The move underlines the headwinds the LCD industry is facing as organic-light emitting (OLED) displays become increasingly popular in everything from smartphones to tablets and notebook computers.
AUO has been moving some equipment from Singapore back to Taiwan and offered its Taiwanese employees working at the plant the choice of transferring back to Taiwan or moving to Vietnam, where it is expanding its manufacturing capacity, sources said.
AUO confirmed Nikkei Asia’s story and said the contracts of most production line workers there will be terminated when the plant closes. Some will stay until the first quarter of next year to handle the closure itself.
The news comes as Apple, the world’s largest tablet maker, prepares to switch from LCD screens to OLED for some of its popular iPad line-up, Cheng Ting-Fang and Lauly Li reported. The company has already switched to the more advanced displays for all of its premium iPhones, and is looking to introduce them for its MacBooks, too.
Apple has also started evaluating the possibility of making foldable iPads after it deploys the flexible OLED screens on the tablet, though it does not have a concrete timeline for doing so, according to two sources familiar with the matter.
Suggested reads
Inside PDD, China’s ecommerce titan behind Temu and Pinduoduo (Nikkei Asia)
Alibaba chief takes direct control of under-pressure Chinese ecommerce business (FT)
UK regulator probes TikTok over parental controls information (FT)
Toshiba will need M&As in its digital push: chairman (Nikkei Asia)
Foxconn rockets into satellites in search of life beyond iPhone (Nikkei Asia)
Lunch with the FT — AI scientist Fei-Fei Li: ‘Maths is pretty clean. Humans are messy’ (FT)
Vantage Data Centers readies for AI demand in south-east Asia (Nikkei Asia)
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