In recent statements, Morris Chang, the founder of Taiwan Semiconductor Manufacturing Company (TSMC), has raised concerns regarding Intel’s strategic focus and operational progress under CEO Pat Gelsinger. Chang’s critique holds significant weight, given TSMC’s status as a world leader in semiconductor manufacturing and its pivotal role in the technology supply chain.
Intel, once the undisputed leader in the semiconductor space, has faced increasing challenges in recent years. Gelsinger, who returned to the company in early 2021, promised a turnaround strategy aimed at restoring Intel’s previous dominance. However, critics, including Chang, assert that the company’s efforts have not lived up to expectations, and the results have been disappointing.
Chang specifically pointed to Intel’s difficulties in regaining its footing in chipmaking and its strained relationship with TSMC, which is vital in the global tech ecosystem. TSMC has established itself as the go-to foundry for many leading tech companies including Apple, Nvidia, and Qualcomm, while Intel has struggled to keep pace in technology advancements and production timelines.
One of the key issues identified by Chang is Intel’s apparent fixation on its own manufacturing capabilities rather than fostering collaborative relationships within the industry. This inward focus, Chang argues, has hindered Intel’s ability to adapt to the increasingly competitive landscape. For instance, while Intel has poured resources into overhauling its factories, TSMC has continued to innovate its process nodes and expand capacity to meet soaring demand for advanced chips.
Moreover, Gelsinger’s commitment to a “IDM 2.0” (Integrated Device Manufacturer) strategy—aiming at both manufacturing chips for Intel’s own products and for external customers—has raised questions. Chang sees this dual-focus as a potential distraction, suggesting that Intel might be better served by concentrating solely on its core operations. This mirrors TSMC’s successful model, which emphasizes complete dedication to the foundry business and client partnerships.
Analysts have been closely monitoring Intel’s performance in developing its next-generation chips. Gelsinger has acknowledged the delays in Intel’s 7nm process node, which was crucial for regaining market share against competitors like AMD and TSMC. While Gelsinger’s return to Intel was initially met with optimism, ongoing setbacks in production timelines have led to skepticism about Intel’s long-term viability.
Chang’s remarks echo a broader sentiment in the tech community—it is critical for semiconductor companies to remain agile and proactive amid rapid technological advancements. The semiconductor industry is characterized by fierce competition, where the companies that successfully anticipate and adapt to market trends tend to thrive. TSMC has exemplified this by continually refining its processes and expanding its collaboration with a diverse range of clients.
In contrast, Intel’s struggles highlight the potential pitfalls of a reactive mindset. The company’s efforts to restore its competitive edge have often been overshadowed by announcements that fail to translate into tangible results. This disconnect between ambition and execution raises concerns about whether Intel can realistically compete in the landscape dominated by nimble competitors.
As the industry evolves, the need for innovation and strategic partnerships remains vital. Chang’s critique serves as a reminder that addressing internal challenges is important, but maintaining strong external relationships can often lead to a more robust market presence. For Intel to reclaim its former glory, it may need to adopt a more open and collaborative mindset, which, in turn, could lead to improved partnerships and innovation.
In summary, Morris Chang’s observations about Intel’s strategic direction reflect significant concerns within the semiconductor industry regarding competitiveness and innovation. For Intel to not only survive but thrive, it might be time to reconsider its approach and learn from the practices that have driven TSMC to success.
