As internet giants shift their focus towards developing their own chips, their interactions with Nvidia and AMD are expected to introduce new dynamics. Many of these fresh variables will originate in Taiwan, which will remain a pivotal vantage point for observing global technological industry transformations.
First, the question arises as to whether companies like Google, Amazon, and Microsoft, engaged in chip development for IoT and AIoT, still require cutting-edge manufacturing processes. This uncertainty will impact the strategies of firms like TSMC, Samsung, and UMC. Secondly, Taiwan commands the supply chain for the ICT industry, encompassing everything from upstream data centers to the demand for edge chips. Whether it's about process technology or supply chain integration, Taiwan stands out as the preferred choice due to efficiency considerations.
Historically, companies like Amazon and Google embarked on their journey by building internet service platforms and attracting substantial user bases. As they grew, they ventured into constructing their own data centers, procuring servers, and offering enterprise-level cloud services to maximize their returns. Consequently, these internet giants emerged as significant buyers, alongside traditional server brands such as HP, Dell, and Supermicro. A server production and sales report by DIGITIMES Research highlights Amazon's ascent to the top spot in Taiwan's server industry, surpassing Meta, with Dell securing third place and Google ranking fourth. This shift underscores substantial changes within the industry landscape.
Global shipment share of major server brands
Source：DIGITIMES Research, May 2023
Moreover, traditional players like HP and Dell prioritized software-hardware integration and system services over data center servers. Supermicro, on the other hand, set up its server factory in Taoyuan, effectively integrating into Taiwan's supply chain.
For the electronics manufacturing industry, change is inevitable sooner or later. This presents a multifaceted set of new business opportunities, often accompanied by conflicts of interest. If AUO seeks entry into the digital signage market, clashes may occur with Qisda and Wistron. However, it's my belief that while conflicts may surface, most business relationships will persist. Should AUO become Samsung Display's primary digital signage supplier, it's unlikely that Qisda and Wistron will sever all ties. Similarly, if we witness AUO and Innolux reconciling in the future, or if Nvidia directly challenges Amazon and Meta, such developments should not come as overly surprising.
