Editor's note
For today's science and technology industry, the importance of chips is like the first, the steam engine, the internal combustion engine in the second industrial revolution, or even more. Whether it is people's commonly used mobile phones, computers, or data centers for enterprise applications, industrial robots (19.520 , -1.50, -7.14%), are inseparable from the support of the chip. And the US ban on sales of ZTE (31.310, 0.00, 0.00%) made most people see the 'soft shoulders' of China's technology industry: China Insufficient supply of cores, heavy reliance on imports, and gaps between the 2-5 generations of international head players, such as US and South Korean companies. How does the Chinese chip down this chip? (Li Yanxia)
On April 20, ZTE issued a statement that the US Department of Commerce’s Bureau of Industry and Security insisted on imposing the most stringent sanctions on the company before the relevant investigation was completed. It was extremely unfair to ZTE and ZTE could not accept it.
In recent years, the global technology industry has been prosperous: 5G communications, artificial intelligence, automatic driving, augmented reality, virtual reality and other technologies have gone from ideal to reality, and the call for the fourth industrial revolution has gradually emerged. In recent years, the company has also made continuous breakthroughs and has taken the lead in the international field in some areas.
However, the lack of 'core' is still the 'pain point' of the Chinese science and technology industry. Han Xiaomin, general manager of IC Research Institute of CCID Research Institute, told the media recently that the backwardness of China's chip industry is 'omnidirectional and systematic', even if it is There is still a gap between domestic leading companies and international mainstream manufacturers, not to mention top manufacturers.
Sravan Kundojjala, deputy director of mobile phone component technical services of the market research organization Strategy Analytics, told 21st Century Business Herald in an interview that China’s semiconductor industry companies are still “backward” in most of the chip business.
Global Semiconductor Industry Geography: U.S. and South Korean Enterprises Take a Strong Position
According to the forecast of IC Insights, a semiconductor industry analyst firm, updated in November 2017, excluding the foundry, the top ten semiconductor companies in the world in 2017, measured by market share, occupied the US and South Korea respectively. Is still in Singapore) 5 and 2 seats, Japan, Singapore and the Netherlands are short-listed respectively. In 2016, the United States and South Korea respectively had 4 companies, 2 companies were short-listed, and the remaining 4 were from Singapore and Japan respectively. , Netherlands, China Taiwan.
Select data for 1993, 2000, 2006, 2016 and 2017 (forecast) for five years. Except for second place in 2017, Intel ranks first in market share in other years; Samsung from South Korea selects the first four years. China ranked seventh, fourth, and second place, and topped the list in 2017. Samsung's rapid momentum in the past two years was mainly due to the rising prices of DRAM and NAND memory chips worldwide. South Korea SK Hynix and the United States Micron.
Overall, the advantages of the semiconductor giants are also expanding. According to data updated by IC Insights in April 2018, the global integrated circuit market (excluding wafer foundry) reached 484.7 billion U.S. dollars in 2017, and 5 The company’s head semiconductor company’s sales accounted for 43% of the market’s total. Compared to 2007, 10 years ago, that figure was still 'just’ 33%.
In addition, from a horizontal perspective, the global top 10, top 25, and top 50 semiconductor companies in 2017 accounted for 57%, 77%, and 88% respectively; in 2007, these figures were also 46% and 67% respectively. 76%. In the strong semi-conductor industry, the space for “new players” has become smaller and smaller. How can we achieve breakthrough in an industry that has reached maturity, and Chinese companies are still facing challenges.
China Enterprise IC Design Market Occupies 11%
However, semiconductor manufacturers in emerging markets are not without opportunities. According to IC Insights data, from 1990 to 2017, the Japanese IC industry (excluding wafer foundry) accounted for 7% of the market share from 49%. Hitachi, Matsushita, Mitsubishi and other companies have withdrawn.
At the same time, Asia-Pacific companies grew at an alarming rate, from 4% to 37%. Among them, the Korean integrated circuit suppliers that came from behind, especially in the field of memory chips, played an important role in this change. In addition, in addition to the original In Europe, the share of North American companies rose from 37% to 49%, and they replaced Japanese companies as the first camp.
However, it is worth noting that this growth in the Asia-Pacific region is not all due to business growth. The consolidation of mergers and acquisitions under financial operations has also played a role. Take the case of Broadcom, which was once based in Singapore, as an example. Several actions of 'Mergers and Acquisitions'. Are stirring the geographical layout of the industry.
In 2016, Avago, headquartered in Singapore, completed the acquisition of Broadcom Corp., the US-based company, and subsequently formed and integrated into Broadcom Limited. In November 2017, Broadcom Corporation Cash and stocks reached US$130 billion in total price and issued a tender offer to Qualcomm, and launched a hostile takeover after being rejected. Just a few days before the first quotation, Broadcom CEO Hock Tan expressed plans to move headquarters back to the United States at the White House. Willingness.
In March 2018, on the eve of the Qualcomm shareholders’ meeting immediately after the decisive battle, U.S. foreign investment (CFIUS) urgently intervened and asked Qualcomm to postpone the holding of the general meeting of shareholders and the deadline for the shareholder vote. A week later, U.S. President Trump took 'nation' On the grounds of security's concern, the Executive Order was signed to block the acquisition. Broadcom immediately announced its formal abandonment of the acquisition of Qualcomm and stated that it would continue to relocate its headquarters as originally planned. On April 4, Broadcom issued a statement that the US headquarters in San Jose, California has now become Broadcom's global headquarters, the company once again became a US company.
A private equity investor in the semi-conductor field who invested over 10 billion pointed out to 21st Century Business Herald reporter that there is a smile curve in the IC industry, ie high profit rate at both ends and low intermediate profit margin. IC design is where the profit rate is at a high point. One of the rings.
The data updated by IC Insights in March of this year shows that if only the IC design is a part of 'multi-gold', the sales of integrated circuits in this type of company in 2017 reached US$101.4 billion, and US companies accounted for 53% of this. This has not yet accounted for 16% of Broadcom's market share in Singapore, which is still based in Singapore in 2017.
However, Chinese companies have also made significant progress in IC design and have become the fastest-rising party in the global IC design market since 2010. In 2010, the market share of China's enterprises was only 5%, but by 2017, It has grown to 11%. In 2009, the only Chinese companies that entered the top 50 IC design companies were HiSilicon, and in 2017, including Haas, ZTE, and Ziguang, a total of 10 Chinese companies ranked among the top 50 .
Annual import value of about 260.1 billion US dollars in China's semiconductors 'adequate income'
Although China is a manufacturing factory for electronic products in the world, in the chip part, China’s production capacity is insufficient.
China is a major consumer of global semiconductors, but its export capacity has been low. According to data from the General Administration of Customs of China, the annual import volume of integrated circuits in China in 2017 was approximately US$260.1 billion. This figure exceeds the total amount of oil imports, but only in 2017. Exports 66.9 billion U.S. dollars.
In contrast, in previous years, China's annual imports of integrated circuits reached US$217.6 billion, US$229.9 billion, and US$227 billion, respectively, in 2014-2016. The annual export turnover of ICs in China was 609 in 2014-2016, respectively. Billion US dollar, 69.1 billion U.S. dollars and 61 billion U.S. dollars. The ratio of exports to imports has shown a downward trend since 2015.
In addition, according to the Datai think-tank data, China's annual consumption of semiconductors accounts for about 33% of global shipments, of which the integrated circuit market accounts for about 81% of the total semiconductor industry, while China's integrated circuit industry probably accounts for the scale of the global integrated circuit industry. 7%-10%. This group of data shows that China consumes one third of the world's semiconductors each year, but its production capacity can only provide one-tenth of the world's total.
'China’s semiconductor companies have indeed made great strides in the past decade',” said Sravan Kundojjala, Associate Director of Strategy Analytics Mobile Device Technology Services, told 21st Century Business Herald reporter, especially with baseband, application processors, Wafer and fingerprint sensors and other components related to smart phones.
However, as mainland Chinese semiconductor companies are mainly concentrated in high-performance, low-cost markets, these companies are unable to advance their technology roadmap compared to other global leading semiconductor companies such as Qualcomm. Kundojjala believes that from this perspective There is a huge technological gap between the semiconductor companies in Mainland China and companies such as Qualcomm and Broadcom.
For example, Kundojjala, China Semiconductor has made 'limited' progress in the field of LTE mobile phone baseband. Like Hass Semiconductor Co., Ltd. (hereafter referred to as 'Haisi') has made good progress in LTE and 5G baseband, and Spreadtrum, Ruixin And Rydico is also true. However, Hass's LTE Cat7 downlink rate of 300Mbps, and high-pass integrated baseband supports up to 2Gbps down rate.
At the same time, the integration capabilities of semiconductor companies in China are far less than those of Qualcomm. For example, Qualcomm's LTE baseband also integrates CPUs, GPUs, DSPs, ISPs, etc. In the baseband field, Hass is the only one that can interact with Qualcomm. Than the Chinese company.
There is a gap in the overall situation and breakthroughs are achieved in some areas.
Guo Gaohang, an analyst at semiconductor industry at Jibang Consulting, pointed out to 21st Century Business Herald reporter that at the design end, nearly 9 Chinese companies have become small and micro start-up companies, and there are plenty of overlaps in the development direction of these companies.
According to data from the China Semiconductor Industry Association, there were approximately 1380 integrated circuit chip design companies in mainland China in 2017, which are generally small in scale and have weak R&D capabilities. Among them, only 500 companies are profitable. In the Internet of Things, automotive electronics, consumer electronics Most of the design companies are start-ups with less than 10 employees. This is in marked competition with giants such as Qualcomm.
While the number of design companies in mainland China has surged, the development of international design companies has shown the trend of integration and resource redistribution. Qualcomm's attempt to acquire the NXP case is one of them.
According to a report from the CCID Institute of Integrated Circuits, if Qualcomm has successfully acquired NXP, this will basically block China's mainland ICs in the Internet of Things, wearable, car networking, driverless, drone, industrial, embedded , High-end development roads in consumer electronics and other fields, while the design companies in mainland China will only be limited to Beidou navigation, military, special fields, agricultural development and other niche subdivisions.
In addition, Guo Gaohang believes that although there are significant breakthroughs in the design of end-of-chip products in mainland China, IP cores still rely on international leaders such as ARM, and the EDA tools used by the design side are completely licensed by vendors such as Synopsys/Cadence/Mentor.
Guo Gaohang analyzed with reporters from the 21st Century Business Herald that while there were Hass in mainland China and Spreadtrum broke through, there was still a lot of preference for mobile terminals, and Hass processor chips were not supplied externally. In the low-end market, in the terminal applications such as PCs and servers, Chinese mainland manufacturers still have no right to speak.
One visible fact is that among the top 20 semiconductor manufacturers in the world, mainland China manufacturers are still missing. Guo Gaohang believes that this is mainly because Chinese manufacturers are now lacking in innovation capacity, the technology gap is still obvious, and industry support and industrial atmosphere still need to be improved.
In the field of memory, Guo Gaohang stated that Chinese companies have entered the global mainstream supplier array in the section of Nor Flash products.
According to statistics from Jibang Consulting, 2016 Zhaoyi Innovation (205.370, 8.49, 4.31%) Nor Flash has a global market share of approximately 7%, and has successfully entered the Samsung smartphone supply chain. However, the mainstream memory chips DRAM and NAND are still serious. Relying on imports, the domestic production of three memory wafer production line production plans, the initial mass production time is basically in the second half of 2018, the technology whether it is 3D-NAND or DRAM, and the gap between the leading international manufacturers about 2 generations.
Kundojjala also pointed out that in terms of cutting-edge process technology, Chinese foundries such as SMIC still lag behind TSMC and Samsung.
Kundojjala believes that there is at least a 3-5-generation gap between the SMIC and the TSMC in the foundry technology. Casting technology is crucial for new technologies such as the flagship chips of 5G and AI.
With the manufacturing end of TSMC already trial production to 7nm, the next 5nm is about to fully open the EUV era. Glofendar and UMC have also mass-produced 14nm. Together with Samsung, Intel and Hynix plan to build OEMs. Business independence, Guo Gaohang pointed out that the global semi-conductor industry's manufacturing side will be more intense competition.
At the packaging and testing side, although manufacturers in mainland China can be said to have entered the world's leading ranks, the future of mature packaging technology will gradually weaken the drive for revenue growth.
Guo Gaohang analyzed that the heat of TSMC's InFo technology once again ignited the pursuit of high-end packaging technology by various packaging and testing vendors. Changjiang Electronics (22.450, -0.52, -2.26%) has acquired Starbucks by acquiring Xingke Jinpeng. In the field of Fan-out technology reserves and market resources, 'although the gap between the giant TMT is obvious, but is a leading position in the OSAT manufacturers'.