The sky-high price of chips

Hi all, it’s Debby in Taipei. Chips require a gargantuan investment and companies are willing to pay it. But first…Today’s top tech news: Cr [View in browser]( [Bloomberg]( Hi all, it’s Debby in Taipei. Chips require a gargantuan investment and companies are willing to pay it. But first… Today’s top tech news: - Crypto.com [suspended withdrawals]( to investigate unauthorized activity on its platform. - Samsung’s [new mobile chip]( is worth getting excited about. - Kosovo Bitcoin miners are [selling off]( their equipment after a government ban. The price of chips In early January, Florida [unveiled]( a $9.7 million program to boost state infrastructure and train future semiconductor engineers in the hope of attracting chip manufacturers to the Sunshine State. The laudable initiative was off by a few orders of magnitude in its estimation of the cost. Investment in chipmaking has rocketed up to the point where Taiwan Semiconductor Manufacturing Co. is set to spend [over $40 billion]( on capex this year alone. Intel Corp., once the leading light of the industry, is also aggressively stepping up expenditures with a planned outlay of more than $25 billion in 2022. And South Korean memory maker Samsung Electronics Co. is on a multiyear spending spree totaling more than $100 billion. The chip crunch has been a function of runaway demand as much as it’s been a product of constrained supply, so the companies responsible for serving us the most advanced silicon are spending fearlessly to expand their capacity. They’re getting a helping hand from governments too. TSMC’s $12 billion fab under development in Arizona got a [boost]( from Phoenix authorities, which agreed to provide about $200 million to develop roads, sewers and other infrastructure. Samsung’s $17 billion Texas plant is also likely to win some U.S. federal incentives that may net it billions. If Florida really wants in on that hotly contested action, it’ll have to be significantly more generous. Even China's chipmaking champion Semiconductor Manufacturing International Corp. — whose access to U.S. Equipment has been hampered by Washington’s [blacklisting]( of the company on national security grounds — has estimated its capital expenditure in 2021 would be [$4.3 billion](. Governments are still waking up to the real expense of their semiconductor ambitions. Japan is [offering]( $6.8 billion in incentives to lure global chipmakers to the country and India is [allocating](bbg://news/stories/R45IFXDWRGG0) $10 billion over six years for the development of a local semiconductor industry. The U.S. may be prepared to come up with a more bountiful $52 billion to bolster its domestic chip industry, but the Biden administration is still struggling to get that [approved](, and that amount is expected to be [split]( among several companies. And none of these countries are buying the very latest and best technology with their proposed subsidies and support. At least 70% of TSMC’s massive spending in 2022 is devoted to cutting-edge fabrication and capacity, meaning the majority of the budget will be used to improve facilities at home in Taiwan, where the company still makes the most advanced chips. TSMC’s recent spending spree has also led foreign suppliers including Entegris Inc. and Merck KGaA to expand their presence in Taiwan to chase more business, a move that the local government hopes will help further lift Taiwan’s domestic ecosystem and consolidate the island’s standing as the global chip leader. “In the future we will turn Taiwan into Asia’s center for advanced manufacturing and advanced chip manufacturing process technologies,” Taiwan President [Tsai Ing-wen](bbg://people/profile/3410816) [told]( a group of machinery executives on Monday. “A critical strategy is to push for foreign suppliers making equipment locally.” —[Debby Wu](mailto:dwu278@bloomberg.net)  If you read one thing The Beijing Olympics will be a technologically complicated experience for athletes, who’ll get [some reprieve]( from the Great Firewall. But is it safe? Here’s what you need to know Warehouse robotics specialist Exotec [raised funds]( at a $2 billion valuation, making it the 25th French startup to be valued at more than $1 billion. The biggest U.S. chipmakers are [starting off 2022]( by unveiling products that push further into each other’s main territories. European Union regulators levied some [$1.3 billion]( in GDPR fines during 2021, in a sign that the bloc’s tough privacy rules are starting to bite. A correction: The Google analysis in Friday’s newsletter listed an inaccurate title for Laurie Richardson. She is a vice president at Google. Follow Us More from Bloomberg Dig gadgets or video games? [Sign up for Power On]( to get Apple scoops, consumer tech news and more in your inbox on Sundays. [Sign up for Game On]( to go deep inside the video game business, delivered on Fridays. Why not try both? Like Fully Charged? | [Get unlimited access to Bloomberg.com](, where you'll find trusted, data-based journalism in 120 countries around the world and expert analysis from exclusive daily newsletters. You received this message because you are subscribed to Bloomberg's Fully Charged newsletter. If a friend forwarded you this message, [sign up here]( to get it in your inbox. [Unsubscribe]( [Bloomberg.com]( [Contact Us]( Bloomberg L.P. 731 Lexington Avenue, New York, NY 10022 [Ads Powered By Liveintent]( [Ad Choices](