Taiwan-based pure-play foundries have implemented various strategies to counter China’s competitive pricing in mature process nodes, according to industry sources.

As major cloud service providers (CSP) and cloud AI-related companies launch new projects, Taiwanese IC designers are positioning themselves to benefit. Industry observers expect the cloud AI and ASIC markets to experience explosive growth in the next three years. During this period, the need for custom chip development will extend beyond CSPs, tech companies, and cloud AI developers to encompass all major industry groups developing their own chips.

Taiwan’s successful track record of attracting major tech investments from companies like Nvidia, Micron, and AMD faces potential headwinds as lawmakers pass a new act that could reduce government subsidies by billions. The development comes despite the nation’s significant achievements in fostering research and development, talent acquisition, and supply chain localization through existing programs.