Chinese semiconductor industry

tphuang said:

I actually think most people on this thread are probably overly optimistic. We also managed to chase away all the reasonable people from posting here more often. You know, people who have some knowledge of the industry, but are restricted to English sources. I would say that people here are probably lucky that China has been consistently beating expectations on all these fields. So, because China's own semiconductor industry has developed so much faster than what's reasonable, the overly optimistic people on this forum like myself are not looking like crazy people.

China seems to have it's own unique set of attributes that allow it to beat expectations in developing its own modern chip design and making industry:
1) a lot of ethnic Chinese people that have significant experience in various fields that can be persuaded to help build China's industry
2) a huge domestic demand with a lot of experience working with foreign products.
3) a lot of money
4) productive labor force with low cost/high throughput
5) large local STEM graduates.

Even with that, it probably was still possible for US to choke of China back in second Obama term if it decided to be really aggressive about going after China. Thankfully, the sanctions really only ramped up in Trump years and was still very gradual even up until now. So for the past few years, China still has been able to access most of the things technology it needed. I feel like a lot of these domestic projects really only picked up steam after the Trump bans started.

Given that we've only hit this emergency mode for 4 years, it's pretty impressive what they've produced already. What Biren developed in 3 years is nothing short of extraordinary. Biren is going to get to work with the very best partners in the world in terms of building ecosystems around its chips. No other new player in the world will ever get the kind of royal treatment that Biren will be getting from China's domestic AI industry. I don't take what Tianshu execs say about fighting for the 5% leftover by Nvidia. That's nonsense. Tianshu itself is just jealous that it's not getting the same support that Biren has gotten. And then, we have Yitian-710 which is the best current CPU of its class. Before Huawei got added to entity list, it's Kunpeng and Kirin chips were all very competitive. Even now, KunPeng-920 is widely used in Huawei servers. With this feedback loop where domestic chip makers are getting feedback and large amount of orders from domestic clients and getting software ecosystems built around, that's how you will see the local firms succeed. Id' be surprised if one of Biren, Kunlun and Hanbo do not succeed in AI GPU market. There are too many domestic players that are now incentivized to devote a lot of resources to building ecosystem around them. I would be surprised if Huawei/Hisilicon cannot design great chips again once SMIC can ramp up its N+1/N+2 production. I also will be surprised if one of Phytium, LoongSon or Zhaoxin don't significantly close gap with Intel/AMD, because they are finally getting the customers and funding needed to succeed.

Lastly, I think Qualcomm is really going to feel the pain soon. The Chinese auto industry is going to feel the threat of US chip ban more than anyone else. I reckon over the next 2/3 years, you will a significant move from Qualcomm/Nvidia auto CPUs to domestic products. And I think Nvidia is in a lot of trouble.

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Abominable said:

The US chip ban is delusional. If America doesn't export chips to China, what does it export?

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BoraTas said:

The US hasn't been good at exporting anything for decades.

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BoraTas said:

The US hasn't been good at exporting anything for decades.

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FairAndUnbiased said:

In addition, at the current scale that most foreign semiconductor suppliers operate at, and a 30-40% dependence on Chinese market, losing this means that they either collapse (very possible if shareholders decide it's better to just bail), drastically scale down or become zombies dependent on taxpayer money. Leading edge fabs must run at 90%+ capacity to make back their investment. Since closing new fabs means they lose all their recent investment, they will close older fabs that have already made their money back. Unfortunately that will destroy the industries that depend on older fabs like automotive including both ICE and EV, power electronics, optoelectronics, display, etc. They'll also have significantly less money to spend on R&D.

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BoraTas said:

- China could just tariff or shadow ban most semiconductor imports after its industry matures enough to cover most applications, which is about to be achieved. Considering that China is 50% of the global market, the USA has no counters to this. It would cost dozens of billions to American tech companies. China already does a similar thing in aviation. Boeing sales plummeted "mysteriously". Qualcomm and Intel sales will "mysteriously" plummet in 10 years too.

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tphuang said:

Lastly, I think Qualcomm is really going to feel the pain soon. The Chinese auto industry is going to feel the threat of US chip ban more than anyone else. I reckon over the next 2/3 years, you will a significant move from Qualcomm/Nvidia auto CPUs to domestic products. And I think Nvidia is in a lot of trouble.

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Abominable said:

The US chip ban is delusional. If America doesn't export chips to China, what does it export?

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Abominable said:

America is unique, the dollar is the global currency. I don't see that lasting long the way America has been seizing assets and sanctioning entire nations.

A big trade deficit is bad for both China and America. If it gets to the point where the only thing America (and the west) exports to China is paper currency, what's the point? They need to milk semiconductors exports for as long as they can.

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tphuang said:

That's why a global downturn + SMIC success in N+1 and then N+2 process will cause huge problems for TSMC. A lot of capex is going into factories that aren't going to be running close to 90% capacity.

Start producing HPC + smartphone chips locally -> crush TSMC and Mediatek

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visitor123 said:

a custom bitcoin mining chip that was made to spec is not as advanced as intel/apple chips!!! It must be Xi's fault.
how can china ever recover from this?
for indians, they can just shit on the street to cope. That's not an option for chinese, sadly. I don't think China can recover from this.

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european_guy said:

Everybody is heavily investing in new capacity...but nobody is doing it for the usual reasons.

1. US is investing to regain technological leadership and to cut its dependency on the very shaky Taiwan.

2. China is doing it to achieve technological independence from US and to neutralize its powerful weapon of tech bans

3. Taiwan is doing it in a desperate move to defend itself and to try to avoid US and China going away

4. Samsung is doing it....just because everybody is already doing it.

It is clear that a huge blood bath looms us on the horizon, 3-5 years down the road.

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