Germany Carl Zeiss, heart of Dutch ASML Lithography Equipment.

Chish said:

The problem is that America is losing it's single biggest and most important tech market, so it is preventing other non American firms from talking advantage of the vacuum left by the American. If others continue and increase their trades with China, America will be left with a decreasing world market. Indian and Japanese markets may offer hope for America firms, but that is in the distant future and it's not guarantee. Others including India, Japan and Korea are not going to put all their eggs in the America basket. Meantime Trump America is building walls around itself.

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And also American companies under Trump administration is no longer reliable partner ... more and more countries will try harder and harder to avoid them

adiru said:

The problem is the goalpost is arbitrary, capricious, and ever moving... Then they can change the rules and say just 1% instead of 10% or 25% etc... The US doesn't want China to climb the tech value chain and will do anything and everything to try to stop China's progress. It all boils down to who has the upper hand...

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Yes.

But look at what happened in the satellite industry.

They ceded leadership and forced the creation of an industry that didn't use US components.

adiru said:

It may be "a few" but it seems like it is strategically and surgically targeted to go after the "tip of the sword" in terms of attempting to cut China off at the very top. For example AI is one of the next big things much like 5G, and so recently US banned the Chinese AI firms such as SenseTime ( one of the most valuable and promising AI startups in the world) under the guise and pretext of human rights. TikTok (a dancing video app) is one of the first Chinese apps to really make it to the top internationally and even gotten very popular in the US, all of a sudden it is a "national security" issue and being investigated and targeted by the US congress. DJI may also be next.... The point is that they are asymmetrically targeting the best China has to offer, the ones that make it out and break out big time will be targeted for banning irrespective of the excuse or pretext used.

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Did you really expect anything else, given the experience of Japanese tech firms in the 1980s?

In China's case, they can power through American restrictions, given some time

Chish said:

The problem is that America is losing it's single biggest and most important tech market, so it is preventing other non American firms from talking advantage of the vacuum left by the American. If others continue and increase their trades with China, America will be left with a decreasing world market. Indian and Japanese markets may offer hope for America firms, but that is in the distant future and it's not guarantee. Others including India, Japan and Korea are not going to put all their eggs in the America basket. Meantime Trump America is building walls around itself.

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Look at the sheer scale of the Chinese semiconductor market.

As per Deloitte, China consumes more semiconductors than the rest of the world combined. No semiconductor company can ignore this.

When the US puts more and more restrictions on the export of US technology - that pushes companies to remove American content faster and more comprehensively.

That logic applies to companies in Europe, Asia, China and even the US.
Eg. Intel using non-US fabs to supply Huawei with processors.

But this all takes some time to happen.

China doesn't actually need to overtly punish foreign companies, as long as they are doing their best to remove US tech.

After all, it is in their own self interest.

adiru said:

I think didn't recently the Microsoft Mr. Gates hint that the jet engines China imports from the West may have a 'kill switch' that disables them if during times of tension or war? Imagine a fleet of Boeing and Airbus all of a sudden cannot takeoff or fly anymore... Would definitely paralyze entire nation even with high speed trains... Even the COMAC C919 is using foreign engines...

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I read long time ago, the F-35 has a built-in "kill switch". It must receive the correct code from satellite each and every day before it can fly. If an unauthorized person tried to tamper with the avionics, it would self-destruct. That's the main reason why the U.S. is willing to sell one of its most advance weapons to foreign customers.
Hopefully they don't do same to ASML lithograprhy tool.

TikTok just got banned by US gov



Seems like for now only the military, not a total ban for the consumer level.... but that is how ZTE and Huawei bans started was it? At first just the military, then the entire ban by getting on "entity list"...

DJI is also banned by the US military, how long before it may also get banned in the US?

It sure seems like the equation is anything that is very successful that is also Chinese will get banned regardless of reason or pretext nowadays.

For example, I don't know about if this is still true for the DJI Mavic 2 but when the original Mavic came out back in late 2016, the DJI Mavic (1) used the Movidius chip for all its AI stuff like AutoTrack and etc but Movidius was not an American company at the time, however later it got acquired by Intel, which is US company. Now back in late 2016 Trump hadn't even barely gotten elected yet and the US was not in a 'trade war' with China... also Obama admin already did the Asian pivot. However, say DJI gets on the "entity list", then all of a sudden it isn't allowed to use Android, cannot buy AI chips from the Intel/US/West, and basically it wouldn't be as robust as Huawei to survive....

US will announced in Jan 2020 the changes from 25% to 10% US content that will set the threshold forbidding companies supplying Huawei.. Clearly this is targetting TSMC. TSMC did a study and indicates 14nm process has about 15% US content therefore Huawei will not able use TSMC 14nm process. TSMC 7nm process has less than 10% therefore can be used for the time being. But US can change again and lower to like 5%. The goal is stop Huawei supply chain.

If TSMC 14nm has 15% US content , how about SMIC's 14nm ? It's not known yet.
SMIC can potentially dragged into being sanctioned due to US claiming it violating the law of supplying Huawei.

That's why I am promoting Huawei get its own fab and secretly license SMIC14/12nm process and have SMIC engineers secretly setup the fab in the background. This way, it won't implicate SMIC during this battle.

Also this is going to be big. Huawei uses alot fo non US components for replacement but this 10% rule will knock alot of non US suppliers to Huawei out.

Huawei maybe in big trouble this time.

tidalwave said:

US will announced in Jan 2020 the changes from 25% to 10% US content that will set the threshold forbidding companies supplying Huawei.. Clearly this is targetting TSMC. TSMC did a study and indicates 14nm process has about 15% US content therefore Huawei will not able use TSMC 14nm process. TSMC 7nm process has less than 10% therefore can be used for the time being. But US can change again and lower to like 5%. The goal is stop Huawei supply chain.

If TSMC 14nm has 15% US content , how about SMIC's 14nm ? It's not known yet.
SMIC can potentially dragged into being sanctioned due to US claiming it violating the law of supplying Huawei.

That's why I am promoting Huawei get its own fab and secretly license SMIC14/12nm process and have SMIC engineers secretly setup the fab in the background. This way, it won't implicate SMIC during this battle.

Also this is going to be big. Huawei uses alot fo non US components for replacement but this 10% rule will knock alot of non US suppliers to Huawei out.

Huawei maybe in big trouble this time.

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So the question becomes is China willing to effectively let/have its tech ambitions neutered or is it going to actually start fighting back and doing something about it. Xi would be naive if he thinks America will be satisfied at just going after Huawei.

Yesterday Huawei, today TikTok, tomorrow DJI. Once the 10 % rule is implemented it can be decreased to 5% or even 0.001% etc... and applied to all Chinese companies not just the tip of the sphere ones.

It is basically a full declaration of economic and technological war.

More concerning news. Show me some feel-good news.
Nothing? Don't tell me its all crickets and winds whistling...Not with 1.4 Billion people. Never.
I demand some good news. It may not be from Shenzen or Shanghai...It could be from some other cities.
A new GPU ? New Processor for Supercomputer ? A new Lithography breakthough? A new DRAM/NAND fab. Nothing?!