In a landmark move that’s shaking up the global tech landscape, Taiwan Semiconductor Manufacturing Company (TSMC) has announced a staggering $100 billion investment in the US — the largest foreign investment in American history. This massive commitment includes building two state-of-the-art advanced packaging facilities in Arizona and has sent ripples of excitement and concern from Silicon Valley to Taipei.

But why is this investment such a big deal? The answer lies in a little-known but absolutely critical chip technology called advanced packaging — a technology that’s becoming a linchpin in the battle for AI supremacy between the US and China.

What Is Advanced Packaging — And Why Should You Care?

At a recent Taipei tech event, Computex, Nvidia CEO Jensen Huang summed it up perfectly: “The importance of advanced packaging for AI is very high… no one has pushed advanced packaging harder than me.” So, what exactly is advanced packaging?

Simply put, packaging in chipmaking means protecting a chip inside a casing and attaching it to a circuit board inside your device. But advanced packaging takes this to the next level. It’s a suite of high-tech techniques that let multiple chips — like CPUs, GPUs, or high-bandwidth memory — sit much closer together. The result? Chips talk to each other faster, work more efficiently, and consume less power.

Imagine a company where different departments need to collaborate closely. The closer those departments are physically, the quicker and smoother the teamwork. That’s advanced packaging for chips.

The Secret Sauce Behind AI Powerhouses

This technology isn’t just a minor upgrade — it’s a game changer. The AI models powering tools like ChatGPT need insanely complex calculations done in the blink of an eye. Advanced packaging makes this possible by ensuring AI chips run at peak speed without hiccups.

TSMC’s own flagship advanced packaging tech, CoWoS (Chips-on-Wafer-on-Substrate), has become almost legendary, especially since the AI boom kicked off. It’s so well-known in Taiwan that even casual tech fans recognize the term.

Nvidia, AMD, and other giants rely heavily on CoWoS for their AI processors. In fact, you could call CoWoS “the Nvidia packaging process,” says Dan Nystedt from investment firm TrioOrient. Demand for this tech has exploded, and TSMC is racing to expand production.

The US Stakes Its Claim in the AI Chip Battle

TSMC’s $100 billion Arizona investment means the US is getting a “one-stop shop” for both advanced chip manufacturing and packaging. This move is crucial — it strengthens America’s AI chip supply chain and boosts competitiveness for top tech players like Apple, Nvidia, AMD, Qualcomm, and Broadcom.

Why is this important? Because, until now, advanced packaging tech like CoWoS has been almost exclusively made in Taiwan. Having facilities in Arizona reduces risks tied to supply chain disruptions — no longer are “all eggs in one basket.”

A Technology with a 15-Year Journey

Though CoWoS is making headlines now, it’s actually been around for over 15 years. It was developed under the leadership of Chiang Shang-yi, a TSMC engineer who faced skepticism and pressure when he first pitched the idea back in 2009.

Initially, few companies adopted CoWoS due to high costs, and Chiang was often the lone advocate. But the recent AI surge has turned CoWoS into a star technology, far exceeding early expectations.

Who’s Playing in the Advanced Packaging Arena?

TSMC isn’t alone in this race. Other chip manufacturing giants like South Korea’s Samsung and America’s Intel, alongside specialized outsourced semiconductor assembly and test (OSAT) firms — including China’s JCET, America’s Amkor, and Taiwan’s ASE Group and SPIL — are all key players developing advanced packaging technologies.

The Bigger Picture: US-China Tech Rivalry

The US and China’s tussle over semiconductor tech is complex. Though they recently agreed to a 90-day tariff truce, tensions simmer due to ongoing US restrictions on chip exports to China. Advanced packaging tech sits at the heart of this struggle because it’s vital for AI chip performance — a strategic resource in the global AI arms race.

Bottom Line

Advanced packaging might sound like a technical niche, but it’s really a critical piece in the puzzle of AI innovation and global tech power. TSMC’s historic investment signals how important it is, not just to chipmakers, but to the future of AI and the broader US-China competition for technological dominance.

The chips may be small, but their impact is massive — and advanced packaging is the glue holding it all together.

Source: CNN – Why this key chip technology is crucial to the AI race between the US and China

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In a bold move, Perplexity AI has submitted a new proposal to TikTok’s parent company, ByteDance, offering a plan that would allow the U.S. government to own up to 50% of a newly-formed entity merging Perplexity with TikTok’s U.S. operations. This proposal, presented last week, revises a previous plan Perplexity submitted on January 18—just a day before the law banning TikTok in the U.S. took effect.

The Proposal: A Shift Toward U.S. Control

The latest plan aims to create a structure that would merge San Francisco-based Perplexity with TikTok’s U.S. business. It suggests that the U.S. government could own a significant stake in the new entity once it goes public, with an initial offering estimated at a minimum of $300 billion. However, the U.S. government’s shares would not carry voting rights, and it would not have a seat on the company’s board.

This proposal is a response to feedback from the Trump administration, according to an anonymous source familiar with the matter. Perplexity’s updated plan allows ByteDance to retain a stake in TikTok, while also meeting U.S. concerns about control over the platform’s operations.

ByteDance’s Role in the Deal

Under the proposal, ByteDance would not be required to sever all ties with TikTok, which would benefit its investors. However, the plan stipulates that ByteDance must allow “full U.S. board control.” This would provide U.S. officials with oversight, ensuring that the app’s operations comply with U.S. interests.

Notably, ByteDance would contribute TikTok’s U.S. business, excluding the proprietary algorithm that drives the app’s content recommendations. This move echoes a suggestion made by Steven Mnuchin, Treasury Secretary during Trump’s first term, who discussed the idea of diluting Chinese ownership to satisfy U.S. security concerns. Mnuchin had previously shown interest in investing in TikTok, emphasizing the need to disconnect the technology from China.

A Potential Solution to U.S. Security Concerns

This proposal is part of a broader discussion around TikTok’s ownership and national security. The U.S. government has raised alarms about the potential risks posed by ByteDance’s control over the app’s algorithm and the vast amount of data it collects from American users. While there’s been no concrete evidence that TikTok has shared data with Chinese authorities or allowed interference in its algorithm, the Biden administration has expressed ongoing concerns.

The Growing Interest in TikTok’s Future

As talks surrounding TikTok’s future intensify, several investors are showing strong interest in the platform. President Trump recently stated that a deal could materialize within 30 days. He mentioned receiving interest from “substantial people” and stressed that the U.S. would need to benefit from any deal made.

Trump also addressed rumors about Larry Ellison, CEO of Oracle, potentially leading a bid for TikTok’s global operations. While Trump confirmed that he had not discussed a deal with Ellison, he noted that many other parties were involved in negotiations.

TikTok’s Ban and Legal Challenges

The U.S. government had passed a bipartisan law in 2024 mandating TikTok’s ban unless it severed ties with ByteDance. Though the Supreme Court upheld the law, Trump issued an executive order to pause enforcement for 75 days, providing additional time for negotiations.

TikTok briefly shut down in the U.S. last week but resumed operations after Trump intervened. Notably, Trump had previously tried to ban TikTok during his first term, but he reversed his stance, crediting the platform for helping him connect with younger voters in the 2024 election.

Looking Ahead

As negotiations continue, the future of TikTok remains uncertain. With mounting concerns over national security and ongoing discussions about ownership restructuring, the platform’s fate could hinge on upcoming proposals like Perplexity AI’s. How ByteDance responds—and whether the U.S. government takes a more active role in overseeing the company—will be pivotal in determining TikTok’s future in the U.S.

Source

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TikTok is calling on the U.S. Supreme Court to intervene and prevent a potential ban on its platform, which could take effect in just a few days. At the heart of this high-stakes case is whether the social media giant should be forced to sell itself to an American company or face a complete shutdown in the U.S.

The case centers around a law passed by Congress in April called the Protecting Americans from Foreign Adversary Controlled Applications Act. This law gives TikTok nine months to either divest from its Chinese parent company, ByteDance, or face removal from U.S. app stores and hosting services.

Key Legal Battle: National Security vs. Free Speech

As the case heads to the Supreme Court, TikTok’s legal team will argue that the law violates First Amendment rights. They contend that the government has failed to consider less restrictive measures and has unfairly limited free speech. In their view, forcing the sale of TikTok or banning it entirely amounts to an unconstitutional restriction on expression.

On the other hand, the Biden administration is pushing back, arguing that the law focuses on national security concerns rather than content. Administration lawyers claim that TikTok’s ties to ByteDance could pose “grave national security threats” by potentially giving the Chinese government access to U.S. user data. They emphasize that the law does not target content or speech but instead addresses control of the app by a foreign entity.

What’s at Stake for TikTok Users?

The decision could have wide-reaching consequences for the app’s 170 million U.S. users. If the court sides with the government, TikTok could be forced to either sell to an American company or be banned. For TikTok, pulling out of the U.S. market is a real possibility if the ruling goes against them, creating uncertainty for users, creators, and businesses relying on the platform.

The case has captured attention not just for its legal implications but for its broader significance in the ongoing debate about national security, foreign influence, and freedom of expression in the digital age.

Source

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