The center of the chips universe

Hi all, this is Jane in Taipei. After finding my way in the world of chips in Silicon Valley, I’ve landed in the island where the next gener [View in browser]( [Bloomberg]( Hi all, this is Jane in Taipei. After finding my way in the world of chips in Silicon Valley, I’ve landed in the island where the next generation of silicon is made. But first... Three things you need to know today: • Meta is opening up its Quest [headset software to rivals]( • UBS is opening up a Menlo Park office [in search of tech deals]( • UnitedHealth’s data leak may [affect vast swath of Americans]( The future is made here Covering semiconductors from Silicon Valley, friends and neighbors not in the tech sector would often ask: What is a semiconductor? That's how much the area, which helped develop the silicon-based integrated circuit, has shifted focus toward software, following decades of investment by venture capitalists chasing uncapped returns. Over here in Taiwan, the chips story is prime-time and front-page news. I’m wowed by the number of mainstream — as opposed to deeply geeky, like me — media members chasing the topic. Dozens of reporters, TV and print, habitually ask techie questions that one might say are deep in the weeds of integrated circuit sorcery. Back in Silicon Valley, I knew the entire handful of major media reporters focused on chips, very few of whom were female. In Taiwan, the gender split among semiconductor reporters is roughly even, even if the leaders of the companies we cover are still men. But, selfishly, the dearth of competition in the US meant great access for me to superstars like Nvidia Corp.’s Jensen Huang. If you think he’s in hot demand globally, try joining a press scrum for any one of his regular visits to the island of his birth. The leather-clad CEO is [treated]( every bit like the rock star he humorously presents himself as. Here, Jensen — yup, we’re all on first-name basis with him — is such a celebrity that reporters chase him down to his favorite noodle shop with cameras. During [Nvidia’s Lunar New Year party]( in late January, a gaggle of reporters waited for him in the lobby of the Sheraton Hotel in Taipei to ask questions. Among them: what do your parents say about how popular you are in Taiwan? “They're just proud of me,” he said at the time. “If you were interviewing my mom right now, she will talk about me like I'm 12 years old." Nvidia’s chips are the beating heart of the AI world, pushing its market valuation to around $2 trillion. Maybe things have changed in the months since I left, but in the San Francisco Bay area, I habitually had to explain to friends who Jensen is, unless they were deep into tech. In the case of Mark Liu, the [chairman]( of Taiwan Semiconductor Manufacturing Co. — Nvidia and Apple Inc.’s go-to chipmaker, I stood by with a dozen reporters in front of the men’s room, waiting for him to come back out during one event. The TV cameras were all pointing at the door as well. And as he walked out, there were questions about his market outlook and his views on TSMC’s competitors. Did I mention that Taiwan reporters are known for their persistence? Silicon Valley’s hotspots for innovation gave birth to world-changing consumer internet companies such as Google, Facebook, Twitter, Airbnb and YouTube and enterprise software companies that brought VCs fame and fortune. In their shadow, semiconductor startups, which take far longer to yield returns, shriveled away. Instead, it was TSMC that invested decades of effort, time and money and emerged as the world’s leader in advanced chipmaking. Samsung Electronics Co. lords over the memory chip business for similar reasons. American chip startups were also starved out by Intel Corp., Advanced Micro Devices Inc. and Nvidia, whose headquarters are amusingly clustered together in a small corner of Santa Clara in California. If you’re a VC shooting for the moon, you weren’t putting your money into silicon geeks trying to defeat goliaths, not when there was all this blue-ocean opportunity with nascent internet businesses. Things may be coming back around now, as the AI buzz that ChatGPT triggered makes chips the most highly-prized bits of electronics again. You need novel and bespoke technologies to develop artificial intelligence models and to run them on smartphones, and that’s going to reward experimentation and journeys on uncertain paths. We know this, because that’s exactly what Nvidia did with its CUDA cores in gaming graphics cards, which are now essential for AI training. An Nvidia blog three years ago put it nicely: “Software Ate the World - That Means Hardware Matters Again.” There is burning interest in creating technology to find a competitor to Nvidia — or a less power-hungry AI chip for the future. And when that next chip is devised, odds are it’ll still be made in Taiwan — at least, for a few more years. The US has woken up to the hollowing-out of its domestic chip industry and is throwing billions at TSMC and Samsung to build new fabrication plants within its borders. Maybe some day, chip company CEOs will face gaggles of reporters in Silicon Valley too. But for that to happen, Taiwan has shown me the country needs to give hardware for our digital future its full attention.—[Jane Lanhee Lee](mailto:jlee3854@bloomberg.net) The big story TikTok is bracing for a legal battle to preserve its lucrative US business in the face of incoming legislation that would force China-based parent ByteDance to [decide whether to leave the US or divest those operations.]( One to watch MikMak CEO: Legislation Won't Be the End of TikTokThe US House of Representatives on Saturday put legislation requiring TikTok’s Chinese parent company, ByteDance, to divest its ownership stake in the app on a fast track to become law. MikMak CEO Rachel Tipograph joins Ed Ludlow and Caroline Hyde to discuss what the bill means for TikTok's future on "Bloomberg Technology." Get fully charged Snap is leaning into election coverage and political ads, which have typically been [a bane for social network operators.]( Pressure is on for big US tech firms to start delivering on their AI promises, [Bank of America says.]( Nominal, a startup building hardware for use in space, energy and other national security sectors, [raised $27 million.]( More from Bloomberg Get Bloomberg Tech weeklies in your inbox: - [Cyber Bulletin]( for coverage of the shadow world of hackers and cyber-espionage - [Game On]( for reporting on the video game business - [Power On]( for Apple scoops, consumer tech news and more - [Screentime]( for a front-row seat to the collision of Hollywood and Silicon Valley - [Soundbite]( for reporting on podcasting, the music industry and audio trends - [Q&AI]( for answers to all your questions about AI Follow Us Like getting this newsletter? 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