Ah, the delightful machinations of global tech giants and the culinary charms of Southeast Asia all rolled into one! Cheng Ting-Fang, our tour guide to the tech bazaar of Asia, kicks things off from a Taiwan that’s so autumnal you half expect the leaves to start tweeting their own scandalous tech gossip. And I’m here for it!
So, Cheng’s just back from Bangkok, where the culinary delights are as robust as a politician’s promise—if you trust them fully, you’re probably dreaming of unicorns as well. Have you tried that pomelo salad? It’s got flavors so wild they could start their own tech startup. “Kitchen of the World,” indeed! They’re not just about spicy curries—oh no, they’re serving up some serious competition on the global stage!
Ah, then we move to the airports—it’s not just the food you should observe, but the billboards too! For instance, Huawei’s advertising their shiny new gadgets right by the road, while MG’s ruby-red roadsters boast about their new Chinese overlords. It’s like a never-ending tech battle royale! No wonder the taxi driver felt the need to apologize for traffic; with all those billboards, he probably spends more time giving guided tours than just driving!
Now, let’s talk finance. Thailand’s like the playground for foreign direct investment, especially with China playing the role of the overbearing parent, investing 24% of the total FDI. Isn’t it nice when mommy and daddy throw money at you? Just remember, dear Thailand, money doesn’t solve everything—like my attempts at dating!
As former president Trump preps for a comeback tour, we can expect more bumpiness in the supply chain than a toddler in a bouncy castle. Get ready, folks; whatever happens next, it will be as unpredictable as the fidget spinner craze!
Onto Apple! Good ol’ Apple, the tech version of a kid who suddenly thinks they can build a house after watching a DIY video. They want to build their own servers in Taiwan. I mean, why ask an experienced builder like Nvidia when you can just wing it? What’s next? Apple’s gonna start making their own roads?! “Sorry, where’s the nearest freeway? Oh, we’ll just put one right here!”
And then, into the heart of Indonesia, where the new leader makes it clear: “Invest locally or take your iPhone and shove it.” No, really! Apple and Google are facing bans for not sourcing enough locally. Who knew that getting your phone fixed could turn into an international incident? “Excuse me, sir, I ordered an upgrade, not a spat with the government!”
Finally, the pricey progress of the iPhone 16! Did they run it through something like a tech spa? They’re charging $999 for a phone that’s half the cost in components! It’s like spending a fortune on a fancy cocktail that only has the price tag to be impressive. “Oh, darling, this drink uses 200-year-old ice!”
And then, TSMC, the chip-making titan—we’re talking machinery so expensive that you could hypothetically buy an F-35 for each one! Is it a chip factory, or a hobby for billionaires? I can just see board meetings, “Why yes, let’s invest in this $350 million toy! It’s not like we need to eat!”
Let’s wrap this up before it becomes a full-blown novel. This is a bonkers blend of tech, trade, and the relentless pursuit of the next big thing. Who needs soap operas when the world of technology provides drama, betrayal, and the occasional snack? Cheers to the ongoing saga of “Who Will Make the Most Money and Break the Most Laws!” Next time, I expect a food truck that’s also a server farm. Now that would have some cachet—just maybe don’t put the ad on a billboard!
Greetings from Taipei, where the crispness of autumn is starting to set in! I’m Cheng Ting-Fang, your host for this week’s #techAsia broadcast.
I recently returned from a delightful trip to Bangkok, where I indulged in the mouthwatering tastes of pomelo salad infused with chili, topped with roasted peanuts and paired with heart-shaped betel leaves. With an enticing array of crispy fish cakes, flavorful satay, delightful spring rolls, and savory pork wontons, along with an abundance of curries and delectable coconut treats, Thailand truly embodies its reputation as the “Kitchen of the World.”
As I journey abroad, I cherish the opportunity to absorb the nuances of my environment, particularly around airports, which often reflect current local trends and developments that are worth exploring further.
During my recent travels, the airport’s boarding announcements highlighted a substantial number of direct flights connecting Bangkok with various Chinese cities, showcasing not only major hubs like Shanghai and Beijing but also smaller locales such as Jinan, Hefei, Kunming, Nanning, and Fuzhou.
Immediately after departing Suvarnabhumi Airport and cruising down the highway towards the city center, I encountered an eye-catching array of massive billboards. Initially, they featured advertisements for Huawei Technologies’ innovative wearable technology and tablets, which were succeeded by a colossal promotion for striking ruby-red roadsters from MG, a storied British manufacturer now part of the Chinese automotive powerhouse SAIC Motor.
These visuals served as a stark reminder of Thailand’s emergence as a crucial arena for both traditional auto manufacturers like Toyota and Ford, along with rising challengers from China, such as MG, BYD, and Neta Auto. It also clearly illustrated Huawei’s commitment to solidifying its standing in the international consumer electronics market. Meanwhile, my taxi driver politely apologized for the traffic congestion we encountered—yet another indicator of the country’s vibrant economy.
In light of the massive supply chain shifts initiated by U.S.-China trade frictions, Thailand has become a favorable destination for foreign direct investment. In 2023, China emerged as the leading investor, accounting for 24% of overall FDI, with a primary focus on electronics manufacturing and automotive supply chain enhancements. The first three quarters of 2024 have witnessed a record high in FDI, largely driven by branches of American and Chinese companies situated in Singapore, according to government statistics.
Servers to order
Apple is on a mission to create its own data center servers and is actively seeking assistance from Foxconn, the world’s largest iPhone assembler and a pillar in its supply chain.
As a leading player in consumer technology, Apple possesses comparatively less experience in server manufacturing than notable competitors such as HP and Google, and it aims to capitalize on Foxconn’s expertise, particularly as the latter is also recognized as the foremost AI data center server manufacturer globally.
This initiative coincides with Apple’s rollout of Apple Intelligence, an AI platform that has significantly boosted demand for its latest iPhone models.
Sources indicate that Apple has set its sights on producing AI servers in Hsinchu, Taiwan, the same area where Foxconn is currently assembling state-of-the-art servers for Nvidia. However, this endeavor may prove challenging as the escalating demand for Nvidia’s products has left limited space and resources for manufacturing.
Calling for investment
Just days into his presidency, Indonesia’s newly inaugurated leader delivered a firm message to foreign tech firms targeting the vast population of the world’s fourth-largest country: either invest locally or forfeit access to this lucrative market.
Yet, analysts caution that this strategy, which is adversely impacting companies like Apple and Google, could potentially backfire as competition for foreign direct investment in the region intensifies.
In recent developments, Prabowo Subianto’s administration has prohibited the sale of Apple’s iPhone 16 and Google’s Pixel phones, citing these companies’ failure to comply with the requirement that 40% of their products be composed of locally sourced materials.
With a youthful, tech-savvy demographic, Indonesia offers immense growth opportunities for giants like Apple and Google. Despite this, neither company has established manufacturing facilities within the country, although Apple does rely on one supplier that operates a factory in Indonesia.
These prohibitions indicate that Southeast Asia’s largest economy may intensify the utilization of restrictive trade policies to attract foreign investments. However, experts warn that this pathway may jeopardize Indonesia’s prospects, especially as neighboring countries like Vietnam and Malaysia adopt a more welcoming stance towards investors.
The price of progress
Apple has allocated a larger budget for electronic components in its latest iPhone than it did for its previous model, according to an in-depth analysis.
The total material cost for the iPhone 16 Pro has reached $568, with a significant portion of this increase attributed to the enhancements intended to support artificial intelligence functionalities. The retail price of the device is set at $999.
In contrast, a recent disassembly of Google’s flagship Pixel 9 Pro unveiled a trend indicating that the cost of its critical components has diminished over the years.
The most expensive element of the iPhone 16 Pro is the custom-designed A18 Pro core processor, which costs approximately $135 to produce through the advanced 3-nanometer fabrication process at Taiwan Semiconductor Manufacturing Co., the leading chip contract manufacturer. This cost is substantially higher than Google’s core chip expenses.
Extreme machines
The competition to manufacture ever more sophisticated semiconductors is intensifying as TSMC prepares to receive its inaugural batch of cutting-edge lithography machines from ASML.
These high numerical aperture extreme ultraviolet lithography machines, costing around $350 million each—the equivalent of three F-35 fighter jets—are nearly double the price of standard EUV machines but possess the capability to print nearly three times as many transistors. The ability to pack more transistors into a chip area translates to enhanced power and advancement in chip performance.
Securing the initial two sets of these high NA EUV machines, Intel seeks to accelerate its chip development and regain its competitive edge within the industry.
Having integrated EUV technology into its chip production process back in 2019, TSMC is several years ahead of Intel, which only initiated production of its first EUV-based core chipset last year. Initially, TSMC will utilize its first set of high NA EUV machines for research and development, with plans for mass production potentially being implemented post-2030.
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Suggested reads
1. Trump win casts cloud over TSMC and Samsung U.S. chip plans (Nikkei Asia)
2. Chipmaker TSMC hit by Taiwan’s soaring energy prices and growing outages (FT)
3. Malaysia expects its ‘remarkable’ IPO boom to continue in 2025 (Nikkei Asia)
4. US Space Force warns of ‘mind-boggling’ build-up of Chinese capabilities (FT)
5. China’s chipmaking equipment market to shrink next year (Nikkei Asia)
6. Southeast Asia’s digital companies boost profitability after pandemic: report (Nikkei Asia)
7. Premium EVs should help put Xiaomi on the podium (FT)
8. U.S. EV policy yet to help Pilbara’s battery chemical venture: CEO (Nikkei Asia)
9. Japan eyes customer safeguards against fall of foreign crypto exchanges (Nikkei Asia)
10. Chinese sanctions hit US drone maker supplying Ukraine (FT)
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Link_link__qPD1b” href=”https://www.bbc.com/news/business-66312369″ target=”_blank” rel=”noopener”>Global chip shortage persists as demand continues to rise (BBC)
