This co-hosted podcast episode delves into the history and success of TSMC (Taiwan Semiconductor Manufacturing Company), a leading semiconductor manufacturer. The hosts trace Morris Chang's journey, from his early life in China to his pivotal role in establishing TSMC as a pure-play foundry, a business model initially considered unconventional. They discuss TSMC's strategic decisions, including its initial low-pricing strategy and its later dominance in the leading-edge chip market, highlighting the company's massive capital expenditures and its close relationships with key players like ASML. The episode also explores the geopolitical implications of TSMC's location in Taiwan and its impact on the global semiconductor industry. A key takeaway is the illustration of TSMC's process power and scale economies as major sources of its competitive advantage, exemplified by its 40% operating margins and 90%+ market share in leading-edge chip manufacturing.
