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“Deepseek application rapidly entry into the market with low -cost chip and artificial intelligence infrastructure has re -exacerbated the competition between China and the United States (USA). The echo of this model, which is allegedly developed with only a few thousand chips, has been further angry with the high cost -effective projects of the US -centered giants. revealing his dependence on his capacity, he placed the concept of “chip wars” in the first place of the agenda.
Nowadays, the chips play a critical role in many areas from artificial intelligence to defense industry, financial systems to applications that facilitate daily life. In particular, advanced semiconductor production is known to be vital for a country’s technology leadership and economic superiority. For this reason, dominating chip supply and production becomes a strategic element that shapes international power balances.
First of all, let us draw a general framework of the current position of today’s leading chip manufacturers by briefly discussing the difficulty and complexity of chip production.
Why is chip production difficult?
What we call a chip is actually miniature operating systems that enable artificial intelligence to work. Chips can be considered as the main source of energy of artificial intelligence with high performance and energy efficient data processing capabilities. In these tiny giants, which contain a large number of nuclei, data exchange is performed in parallel and efficiently thanks to the high -speed ports between the nuclei; This makes it possible to work with more complex data sets by increasing the efficiency and speed of artificial intelligence applications. However, the production of this complex structure in which each transistor is located in microscopic dimensions requires sensitive processes that do not contain error and billions of dollars of research and development (R & D) investments. For this reason, chip production is considered one of the most challenging industries not only technically but also financial and logistics.
Global chip map: Which country and company are ahead?
Despite these difficulties, Taiwan -based Taiwan Semiconductor (TSMC) is leading 54 percent in the global chip market. American giants such as Nvidia and Intel, this company, watch two South Korean and a Japanese company; In China, Huawei, Baidu and Alibaba also invest intensively in artificial intelligence chips.
China considers independence in chip production as national security and supports domestic companies with intensive subsidies. In addition, it sets ambitious goals to increase domestic chip production.
In 2022, the United States enacted the Chip and Science Law in order to limit the rise of China and to control the supply chain to its own control and provided incentives exceeding $ 200 billion to the sector. In this context, producers such as TSMC are directed to establish a factory in the USA with tax reductions and funds, while sensitive technologies are shared only with the US and allies with the strategy of “Small Garden, High Fence”. At this point, TSMC’s sales to China were limited to 30 percent.
In addition, Biden management categorized countries as Tier 1, Tier 2 and Tier 3 and signed the document that brings different levels of chip restrictions. According to this document, Tier 1, which consists of the US, Canada, Australia, Japan and South Korea, is of the least restriction, while Tier 2 countries such as Turkey, India and Brazil may face import barriers according to the level of compliance with US policies. It may be aimed at minimizing commercial exchange of countries in this category with China. Tier 3 countries, especially China and Russia, are the group that is largely restricted by access to advanced chips.
Although the law triggers a private sector investment of $ 450 billion, US President Donald Trump asked this program to be “wasted the money of taxpayers and a terrible mistake”. Trump, who argues that tariffs were more effective in promoting investment, announced that he would bring new import taxes to semiconductors from April and attributed TSMC’s additional $ 100 billion investment in the US to this threat. The TSMC side is based on the market demand. Although Trump claims to attract companies such as TSMCs to the United States, this strategy seems to be controversial in the long run.
10 years later of the chip world from the perspective of “Art of War”
According to Sun Tzu’s famous work, the most important element in a war is to determine the strong and weaknesses of the parties. In this context, while maintaining its advantageous position in the US chip war with its technological superiority, global alliances and strong R & D infrastructure; The fact that most of its production is in Asia and its failure to reduce its dependence due to high costs is an important weakness.
China is trying to become independent in the long run with the rapidly growing domestic market, state -supported investments and production capacity, but still face great obstacles due to its dependence on the US in advanced technology chips and the sanctions of critical suppliers. China’s illegal “supply with third parties” method does not seem to be sustainable. While the US aims to slow down China by restricting technology transfer and keeping key players such as Taiwan under control; China tries to overcome these obstacles by creating its own chip ecosystem and finding alternative markets. On the other hand, Trump’s tariffs can stretch the US relations with the US allies in Europe and Asia because these countries are dependent on chip imports.
Another teaching of the Art of War is “agility and flexibility” which requires a free environment. While the R & D investments and innovative approaches of US companies allow America to maintain technology leadership, Chinese companies are lagging behind in innovative technologies compared to the West due to the strict state controls of Beijing. China’s strategy in techno-economy “West will produce so that we can see the risks. shaped as. However, how much can this work in the field of artificial intelligence that develop and require innovation?
Finally, we can argue that China is using the principle of “cheating”. For example, Chinese companies can form their own ecosystems based on some open -source artificial intelligence models in the United States. This allows the innovation efforts of US artificial intelligence companies to be quickly copied and adapted by China. Secondly, China enables the chip access by activating illegal supply chains to overcome US sanctions on advanced chips. The third and perhaps the most critical point is the strategic propaganda of Deepseek. Deepseek rapidly raised the upper ranks among the downloaded applications in the USA and had a major impact on the market. However, the fact that the platform sometimes introduces itself as a chatgpt, suddenly activates the state filter after answering China questions to a certain point, may be an indication that the artificial intelligence model is trained with data of US companies. In addition, Deepseek’s description of “produced for $ 6 million” created the perception that the entire process was completed only at this cost. This has questioned billions of dollars spent by Western technology giants, such as OpenAI, questioning billions of dollars in the markets, and shook the investor confidence. This move shows that not only tricks and deception, but also the principle of “Psychological War” is used effectively by China. This aggressive strategy against US technology giants proves that artificial intelligence and chip competition are not only for technical, but also with perception management and propaganda war.
Considering the current conditions; Technological superiority, global alliances, supply chain, impact of sanctions and R & D investments continue to be the leading position in chip production. However, instead of evaluating this competition within the framework of a “winner and loser”, it is necessary to consider the perspective of Jevons Paradox. The Jevons Paradox is a concept put forward by British economist William Stanley Jevons in the 19th century, and suggests that the increase in the productivity of a source can increase the consumption of that resource instead of reducing it. Jevons formulated this paradox by observing that the demand for coal was not decreased with the increase in the efficiency of steam engines, but rather increased.
When this paradox chip production is applied, technological progress and productivity increases can fuel chip demand and thus global production. It can increase demand by creating more use areas in areas such as artificial and cheap chips, artificial intelligence, defense, finance and consumer electronics. This creates a scenario that not only major players such as the US and China, but not all countries and companies investing in chip production. Although China has a high potential in chip production, the US will be the best party that manages the dynamics of productivity and demand, even though the United States is currently leading its leadership. “
(Büşranur Begçecanlı is an Anadolu Agency reporter.)
