(2021-09-25) The Amazing Taiwanese Hardware Tech Cluster

I've been interested in PC building for about 13 years now, and for the longest time I thought that Cooler Master — a major PC parts company — was an American company, purely based on the fact that it had an English name and all of its marketing and branding seemed like that of an American company. About a week ago I was looking at a Cooler Master PC case I wanted to buy and read the spec sheet, and something caught my eye... I saw a sentence that was 100% understandable, but was written in a way that a native English speaker would never write. Masaka... could it be that Cooler Master is a company that isn't from America? Yup, according to the interwebs Cooler Master is actually a Taiwanese company, one of many major Taiwanese hardware tech companies.

If you've ever delved into PC building you probably know a lot of Brands™, but you've probably never looked into where the companies come from. Well, all of the following brands here are from Taiwan: G.Skill, ASUS, MSI, GIGABYTE, ASRock, Cooler Master, Seasonic, Thermaltake, SilverStone, Lian Li, BenQ, AOpen, Lite-On, Shuttle, PowerColor, BioStar, VIA, ECS, ADATA, Ducky, Transcend, and Realtek. There are more Taiwanese PC parts brands I think I missed. There are also non-PC parts companies from Taiwan like HTC, Synology, and Acer.

Of course, a lot of these companies do relatively "simple" electronic parts manufacturing compared to others. There is one super important Taiwanese company that you may have heard of if you are a consumer electronics nerd or keep up with asia-pacific geopolitics: TSMC - Taiwan Semiconductor Manufacturing Company. This company currently makes the best, most cutting edge computer chips. They are used by Apple and AMD, both of which have the best SoCs and CPUs (in terms of performance and efficiency) today. A lot of their great performance is owed to TSMC's excellent manufacturing. TSMC is a semiconductor manufacturer for "fabless" semiconductor companies, this means that they only do the manufacturing of chips, the actual design and layout of the chips is up to companies like Apple to deal with. This allows them to focus on just simply being the best at manufacturing chips. It seems to be working so far. Currently in semiconductor manufacturing, EUV — extreme ultraviolet lithography — is a big deal. It allows the creation of smaller and smaller transistors and more and more dense chips, which are more powerful and more efficient. Last year TSMC owned 50% of the all the installed EUV machines in the world according to this article. That's nuts. Also check out this article about the interesting story of the founder of TSMC, who almost became the CEO of Texas Instruments.

There is another major Taiwanese electronics company called Foxconn, that makes... everything? They make Apple devices, they make Xboxes, they make Nintendo gaming systems, they make Google Pixels, and they made Blackberries. Seriously, check out the list of companies that worked with Foxconn. Now, granted, most of Foxconn's manufacturing happens in China, not Taiwan, but still it's really cool that such a major electronics company came from Taiwan.

There are two major American hardware tech companies that you may have heard of: Nvidia and AMD. The CEO of Nvidia, Jensen Huang, and the CEO of AMD, Lisa Su, were both born in Taiwan. They were born in the same city actually (Tainan), and they're close relatives too. Jensen Huang is Lisa Su's grandfather's nephew. How did they both end up in such important roles in tech companies? What kind of connections did they make to get into their roles?

When the electric car maker Tesla was making their first car, the Roadster, back in 2007 there were many companies that made parts that were useful for gas-powered cars, but there weren't a lot of companies that made automotive parts that were useful for electric cars. They ended up finding the companies that made the electric car parts they needed in Taiwan, and the Tesla Roadster had 30-40% Taiwanese components. This article talks about this and Taiwan's electric vehicle parts industry.

One question that needs to be answered is why did Taiwan end up with so many important hardware tech companies? Who made the decisions that led to this? So basically, Taiwan was a place where American companies made electronic stuff for cheap back in the 1960s to 1980s. This resulted in the Taiwan economic miracle, which made Taiwan go from being a developing country to a more developed one, kind of like China recently. During this miracle, a bunch of things happened. In my view the key starting point to this whole thing seems to be National Chiao Tung University establishing their Department of Electrophysics, Department of Electronic Engineering, and Semiconductor Research Laboratory in 1964. This led to the rise of a local tech industry which led to the creation of the Industrial Technology Research Institute in 1973. TSMC's founding was helped by the ITRI. Later in 1980, the Taiwanese government created Hsinchu Science Park, which is located in the same city as National Chiao Tung University. HSP was made so there would be a place were tech companies could set up offices. And today, tons of big technology companies have a presence there (check out the list). Part 9 of this webpage adds some more details to this story. So from all that, Taiwan ended up having a huge presence in the hardware tech industry today.

One more thing that I find interesting that seems to greatly contribute to Taiwan's success in the tech space is the fundamental structure of Taiwan's society and economy which has created a lot of "hidden champions". These are basically companies that no one outside their niche industry has heard of who are the best or one of the best in said industry. Germany also is praised for their many hidden champions. This article talks about Taiwan's hidden champions in more detail.

So yeah, in conclusion: Taiwan is great at technology. Thank you for reading.

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