Opinionated - China Chipping Away to Semiconductor Dominance

[cirr]

Chinese chips could rival Qualcomm and Mediatek

Chips, News | tags: China, chipmaking, MediaTek, Qualcomm, TSMC

December 9, 2015 by Nick Farrell.



Beancounters at data analyst TrendForce have been shuffling their tarot cards and have decided that one day that Chinese chip designers will rival the big names like Qualcomm and MediaTek.

The Chinese have been spending a fortune trying to get self-reliance in semiconductors and have spawned a cluster of chip designers.

Trendforce said that China has nine companies that design and sell chips in the global top 50 from just one in 2009. Clients such as Chinese smartphone manufacturers have also helped compatriot chip designers amass a market share of almost a fifth, according to data analyst TrendForce.

Huawei subsidiary HiSilicon and Spreadtrum Communications are rising in prominence as the government ploughs funds into home-grown technology to reduce cyber-security risk, following revelations in 2013 of US global cyber-snooping programs.

It is harder for US tech firms to do business and Qualcomm is facing delays closing licensing agreements. In contrast, sales at Chinese designers are set to surge this year, some by as much as 40 percent.

Chinese chip designers lag top rivals in terms of technology by four to five years yet have the potential to disrupt the global chip supply chain, industry experts and executives said.

China’s list of chip design hopefuls include HiSilicon, Spreadtrum and RDA Microelectronics which are controlled by state-backed Tsinghua Unigroup. But there is also All Winner Technology, Leadcore, Galaxycore Microelectronics and Goodix Technology.

TSMC has indicated it thinks that the Chinese will become a strong force in a few years particularly in the integrated circuits market.

TSMC co-Chief Executive Officer Mark Liu warned the Chinese that they have to be careful not to just dump a ton of low price chips in the market.

This is what happened when the Chinese tried to develop industries, such as solar panels and liquid crystal displays. In that case the investment led to oversupply and plunging prices.

Chinese chips could rival Qualcomm and Mediatek | TechEye

 

[rott]

Great to see China's share getting bigger in this important industry.

You seem very pro-china. Are you an overseas Chinese born in the Philippines?

 

[oproh]

You seem very pro-china. Are you an overseas Chinese born in the Philippines?

No, pure Filipino

 

[Shotgunner51]

IC is the top source of China's trade deficit by category, far exceeding crude oil.

And that's why despite China Mainland records trade surplus as a whole, recorded massive trade deficit with Taiwan, South Korea.

***************

China Is Still Falling Behind In Becoming Self Sufficient In Semiconductor Production | Seeking Alpha
Feb. 22, 2016 1:03 PM ET

Despite massive investments in China's semiconductor industry, production is making minimal impact on meeting growing demand, according to the report "Mainland China's Semiconductor and Equipment Markets: A Complete Analysis of the Technical, Economic, and Political Issues," published by The Information Network.

• China produced 113.2 billion ICs in 2015, up from 102.0 billion in 2014, a year-on-year increase of 11.0%.
• However, China's imported ICs were 305.5 billion (units) ICs in 2015, up from 285.7 billion pieces in 2014, an increase of 6.9% year on year.
• Thus, the ratio of consumption to production increased to 27.0% in 2015 from 26.3% in 2014 and will increase to 28.9% in 2018.

In a comparison with other regions:

• In the IC manufacturing (foundry) segment, China Mainland sales were about 9% of the worldwide market, far behind Taiwan at 72%. Market leaders are TSMC, GlobalFoundries, and UMC. China's SMIC (NYSE: SMI) was a distant fifth.
• In the IC semiconductor packaging/assembly segment, China Mainland sales were around 8% of the worldwide market 2014, far behind Taiwan's 48%. Market leaders are ASE (NYSE: ASX), Amkor (NASDAQ:AMKR), and SPIL (NASDAQ: SPIL). China's Jiangsu Changjiang Electronics Technology was a distant sixth.
• On a revenue basis, China imported 65% of the global semiconductor market production (US$218.4 billion versus US$335.8 billion), as most electronic products are made in China.

 

[C130]

TSMC is just awesome I don't see China replacing Taiwan,South Korea, or the U.S any time soon in the FAB department

next gen supercomputers will be using TSMC fabs 16NM process

NVIDIA Pascal GPU's Double Precision Performance Rated at Over 4 TFLOPs, 16nm FinFET Architecture Confirmed - Volta GPU Peaks at Over 7 TFLOPs, 1.2 TB/s HBM2

 

[Shotgunner51]

TSMC is just awesome I don't see China replacing Taiwan,South Korea, or the U.S any time soon in the FAB department

next gen supercomputers will be using TSMC fabs 16NM process

NVIDIA Pascal GPU's Double Precision Performance Rated at Over 4 TFLOPs, 16nm FinFET Architecture Confirmed - Volta GPU Peaks at Over 7 TFLOPs, 1.2 TB/s HBM2

Agree, I don't see SMIC closing up gap anytime soon with TSMC, even when SMIC was formed by ex-TSMC veterans.

Business is business, I hope Mainland fabs catch up steadily, through (1) more domestic investments (2) more cross-strait or overseas M&A (3) recruit cross-strait or overseas talents.

NVIDIA is another awesome corp. Other than Taiwan, South Korea, I wish China Mainland can work closer with Taiwanese American community as well, say with Huang Jen-Hsun (NVIDIA), Lisa Su (AMD), etc. As said above, I look forward to more people-to-people interactions, more capital flow.

 

[bbccdd1470]

In a comparison with other regions:

• In the IC manufacturing (foundry) segment, China Mainland sales were about 9% of the worldwide market, far behind Taiwan at 72%. Market leaders are TSMC, GlobalFoundries, and UMC. China's SMIC (NYSE: SMI) was a distant fifth.
• In the IC semiconductor packaging/assembly segment, China Mainland sales were around 8% of the worldwide market 2014, far behind Taiwan's 48%. Market leaders are ASE (NYSE: ASX), Amkor (NASDAQ:AMKR), and SPIL (NASDAQ: SPIL). China's Jiangsu Changjiang Electronics Technology was a distant sixth.
• On a revenue basis, China imported 65% of the global semiconductor market production (US$218.4 billion versus US$335.8 billion), as most electronic products are made in China.

I didn't know that we are so far behind on marking share. How much behind on the quality of Chinese-made semiconductor vs the Taiwanese one?

 

[Shotgunner51]

I didn't know that we are so far behind on marking share. How much behind on the quality of Chinese-made semiconductor vs the Taiwanese one?

Well I am not a tech guy so can't comment on tech details, just the financials (and trade data) are self-explanatory on Taiwan's dominant global position in this business. Mainland is behind South Korea, let alone IC giant Taiwan.

While I wish Mainland peers catch up steadily, congrats to Taiwan bros!

@TaiShang

 

[xunzi]

The good news is at some point, Moore's Law will make it impossible to make any chip smaller. This is where the next revolution of quantum chip will come into play.

 

[XiaoYaoZi]

IT industry and aerospace industry have the longest and the most complex tech and supply chains in all industry fields.

 

[Shotgunner51]

IT industry and aerospace industry have the longest and the most complex tech and supply chains in all industry fields.

True bro, it will take years if not decades to see results for long payback-period investments like these. Big upfront money, highly demanding on human capital, complicated ecosystem. That's also why "Made in China 2025" spans through 2 five-year periods.

 

[Abacin]

The main problem is that China is banned by the West to get the latest semiconductor equipment while Taiwan, Korea and Japan have no such a problem. China's main semiconductor equipment manufacturer AMEC(中微半导体) was only founded in 2006. Its equipment are two generations behind the West. This is the major reason that China is lagging behind Taiwan, Korea, USA in the chip industry. But I believe that China will catch up quickly since many Chinese top managements and engineers in those top chip companies in USA went back to China during last decade. Just look at AMEC, a company with only 10 year history has posed a threat to those top equipment companies.

Taiwan, Korea and Japan chip companies can have joint development with west equipment companies such as Applied Materials. Chinese chip companies can only buy generation old equipment. China must have the complete line from design, manufacturing to equipment for self-development. If China can succeed, China will win the whole chip line.

 

[Bussard Ramjet]

China’s semiconductor ambitions get a reality check as Stats ChipPac deal sees poor returns


http://www.scmp.com/tech/china-tech...mbitions-get-reality-check-stats-chippac-deal

 

[FairAndUnbiased]

wait - all that's happening is, a company has lost some money.

this says absolutely - nothing - about what is happening with the technology.

if losing money was catastrophic, do you know how many catastrophes there would be, literally today, right now?

 

[C130]

China should just buy AMD.