ASML Trade Secretaries: Do U.S. Intel, Intel, and Nvidia have a Role in Supporting Advanced Semiconductors?
The most advanced semiconductors are made by a large group of companies from all over the world, and that’s huge. Think of it this way: if you wanted a processor with billions of transistors packed together tightly, you could find it in the designs of Intel, Apple, and Nvidia. Synopsys and Cadence create sophisticated computer-aided design tools and software on which chip makers actually draw up their newest ideas. Applied Materials forge the billions of transistors and connect wires in the chip. The very long wavelength of ultraviolet light that can be used to print tiny, tiny defects on wafers was discovered by Zeiss SMT, a German company specializing in optical lens, in collaboration with ASML. KLA, Intel, and firms from Korea to Japan to Taiwan all play roles in the coalition.
Given the recent agreements between governments of the US, Netherlands, and Japan that restrict the export of advanced chipmaking machinery to the country, it is noteworthy that China is alleged to be involved with ASML’s trade secrets. The terms of this agreement have not been disclosed but follow earlier pressure from the US in 2018 that persuaded the Dutch government to withdraw ASML’s license to export its EUV machines to China. The US has banned the sale of EUV machines to China because it is ASML’s third- biggest market after Taiwan and South Korea.
This week I interviewed U.S. Secretary of Commerce Gina Raimondo, who oversees both the new export controls on chips and the $52.7 billion that the Biden administration has just secured to support more U.S. research on next-generation semiconductors and to bring advanced chip manufacturing back to the U.S. Raimondo rejects the idea that the new regulations are tantamount to an act of war.
She told me that the U.S. was in a difficult position. “Today we are purchasing 100 percent of our advanced logic chips from abroad — 90 percent from TSMC in Taiwan and 10 percent from Samsung in Korea.” That is crazy, but it’s true.
ASML’s chief executive officer, Peter Wennink, has previously expressed concerns over restrictions being placed on the company’s business dealings with China. “If you shut out the Chinese, you can force them to strive for tech sovereignty, in their case real tech sovereignty,” said Wegnink in an interview. They will have the ability to do it all by themselves in 15 years. European suppliers will not be around anymore.
Well, ASML has no idea how to make chips. Only one company is able to do so much. This machine is just one of multiple ultra-complex machines needed to make chips. In addition to shining light at exactly the right wavelength through this really complicated optics, you also need different machines that can lay down thin films of material just a couple of atoms thick or etch canyons in the silicon just a couple of atoms wide. ASML knows nothing about the machines that are produced by different companies. There are unique capabilities that the chipmakers have. TSMC uses better machines than everyone else to make chips. The toolmakers like ASML and the chipmakers like TSMC can make effective semiconductors, by partnering with each other.
The American-Chinese Connection: Chip War, Why China and Japan Are Bounds on Advanced Chips and Processes in the World
A deal was reached at the White House on Friday, though it was not officially announced, partly due to “concerns by Japan and Netherlands about potential retaliation by China,” according to the Journal, which cited a person familiar with the matter.
The deal will extend US export controls to Dutch and Japanese companies, such as ASML and Tokyo Electron.
The Biden administration had banned Chinese companies from buying advanced chips and chipmaking equipment without a license. It also restricted the ability of American citizens to provide support for the development or production of chips at certain manufacturing facilities in China.
Asked about the three-way talks in Washington, Nishimura said “we would like to respond appropriately while taking into consideration the regulatory trends in each country.”
Because of its dominance in the market, ASML has been cited by experts as a bellwether of the growing rift between China and the West over access to advanced technology.
In a statement on Friday, the company said that it did not expect any material impact to its financial projections in the years to come.
The Dutch government refused to grant a license under US pressure, which resulted in those machines being forbidden from being sent to China.
The Dutch government was asked to restrict the export of ASML stuff to China by President Joe Biden. ASML is the only company in the world that makes a specific machine needed to make the most advanced chips. This machine is used to make chips for Apple’s iPhone. ASML shapes the world economy in more than one way. How did that happen?
A lot of this, along with some deep dives into geopolitics and the absolutely fascinating chip manufacturing process, is what Chris Miller, professor and author of Chip War: The Fight for The World’s Most Critical Technology walked me through. This one has everything, from foreign policy to high-powered lasers and hotshot executives, as well as the fundamental limits of physics. Here we go.
So first off: what is lithography? If you want to make patterns on silicon wafers, you do so by shining light through masks. The pattern in a smaller version of a chip comes from blocking light in certain areas and allowing it to go through in others. Billions of circuits are carved into advanced chips. Ultra-precise carbon capabilities are required because they are often the size of a Viruses or even smaller. The light wavelength of EUV lithography is not the same as the wavelength of visible light. You need really small wavelength light because the circuits you’re carving are very, very tiny and often measure just a couple of nanometers in dimension. Producing this type of light is really hard because it’s right next to the X-ray spectrum. The production of it is complicated, and the development of mirrors to reflect it is also very difficult.
Here’s how the process works. A ball of tin falls at a rate of several hundred miles an hour through a vacuum and measures around 30 millionths of a meter in diameter. It is pulverized by two shots from one of the most powerful lasers ever deployed in a commercial device and explodes into a plasma measuring several times hotter than the surface of the Sun — that is, several hundred thousand degrees Fahrenheit. The EUV light that is emitted by this particle is collected via a series of about a dozen mirrors, which are the flattest mirrors humans have ever produced. The mirrors reflect the light in order to hit the wafer and carve the circuits that make your phone possible.
TSMC has to buy this machine from ASML, which has to assemble all these components from the flattest mirrors ever produced to the most powerful lasers ever deployed in a commercial setting to balls of tin. I imagine the balls of tin are somewhat easy to acquire. It has to make that machine, then it sells it to TSMC, which then uses it to make iPhone chips or whatever else. Does ASML just wash its hands of this machine when it sells it to TSMC? It seems like it’s not easy to operate.
Yes. ASML sells to customers all over the world — except in China, which we can discuss — but there are only a couple of companies that can really plausibly use an EUV machine. It’s TSMC, Samsung, Intel, and a couple of memory chip makers as well, like SK Hynix and Micron. There are very few other potential customers out there because the price tag is so high and the level of precision manufacturing skill needed to actually make use of them is really so niche and unique that ASML knows it will only ever have a customer base measuring a half dozen or maybe, at most, a dozen firms.
ASML has been accused of intellectual property theft in connection with a carpenter’s EUV tool: The case of DongFang JingYuan Electron
Yeah. Milwaukee or DeWalt are both good power tools, but that doesn’t make you a carpenter. Is it the case that you can buy the tool, but not know how to use it?
That is correct. Knowing how to use it, as a process, not only requires starting with a PhD in electrical engineering or material science but really requires years of working with the tools. The process of developing an EUV tool took 30 years. You can see the scale of precision that was needed to harness it.
The firm did not expand on what information may have been compromised, nor did it disclose when this breach occurred. This marks the second time in as many years that ASML has reported having its data stolen by entities based in China, having accused Beijing-based tech firm DongFang JingYuan Electron of intellectual property theft in its 2021 annual report.
Based on its initial findings, ASML doesn’t believe that the misappropriated data will be detrimental to its ongoing business but acknowledges that some “export control regulations” may have been violated. The data breach has since been reported to the relevant authorities, and ASML is “implementing additional remedial measures in light of this incident.”