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this post was submitted on 27 Oct 2024
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Your friend knows a secret recipe for the best chocolate chip cookies. Your mother owns the best ovens in town.
Your friend cuts a deal with your mother to use her oven exclusively. Your mother agrees knowing she’ll get to charge your friend every time they use the ovens.
This is like that. The main value is in the design (recipe). Modern foundry’s are also complex and difficult to operate affordably, but they exist all over the planet. It’s ultimately the partnerships that makes it all possible.
Not all foundries are the same. Taiwan is leading the way for quite a long time.
There's a lot of money in both intellectual property and physical manufacturing. Trying to do an analogy with software is unfair because in software most of the costs is labor, and once the first copy is made you can make and sell as many extra copies as you want. Physical manufacturing needs machine maintenance, and expensive materials in this case.