In the past, most computer designers would have their own fabs.
But once designs started getting very complicated, it started to make sense to separate concerns between designers and fabs.
What this means is that design companies would primarily write register transfer level, then use electronic design automation tools to get a final manufacturable chip, and then send that to the fab.
It is in this point of time that TSMC came along, and benefied and helped establish this trend.
The term "Fabless" could in theory refer to other areas of industry besides the semiconductor industry, but it is mostly used in that context.
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