Chinese semiconductor industry

tphuang said:

alright, I listened through SMIC's earnings call at @hvpc's suggestion. this is what i heard


basically, good news across.
Very important to note that SMIC still has a lot of work to do in the 28 to 90nm range. They need to develop different products, qualify for higher standards and increase capacity.

Also, important to note how changing supply chain in China is helping them and their existing suppliers are looking to move to more advanced processes to improve competitiveness. So, the SMIC & customer relationship in improving products and competitiveness is quite important.

I also find it interesting that newer players in supply chain are opting for SMIC products. I wonder if the existing players are non-Chinese companies and they are getting cut out. For example, before the OLED is produced by Koreans & now it's produced by BOE and they use domestic drivers. Or even domestic flat screens use to source foreign designed chips & now they source domestic designed chips.

Would partially explain the huge drop in semi import from Korea!

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The huge drop of Korean semi import has more to do with weak demand in China，because Chinese domestic semi production also seen huge drop this year.


And even some Chinese fabless are starting to divert production from Chinese fabs to Taiwanese fabs，due to pressure from foreign clients.

tonyget said:

The huge drop of Korean semi import has more to do with weak demand in China，because Chinese domestic semi production also seen huge drop this year.

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And even some Chinese fabless are starting to divert production from Chinese fabs to Taiwanese fabs，due to pressure from foreign clients.

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its overall weak demand. Korean semiconductor production dropped -41%.

tonyget said:

The huge drop of Korean semi import has more to do with weak demand in China，because Chinese domestic semi production also seen huge drop this year.

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the drop in Korean export to China is more than China's overall semi drop. Now, a lot of that is due to collapsing memory chip price, but I think SMIC earnings call would indicate more logic chips in supply chain have also shifted to SMIC from Samsung and others

tonyget said:

And even some Chinese fabless are starting to divert production from Chinese fabs to Taiwanese fabs，due to pressure from foreign clients.

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Well, this just explains why SMIC's US region revenue dropped 40%. Some American customers are actively shifting away from Chinese fabs. But what % of Chinese fabless customers are Chinese vs American? What you posted here is really pretty meaningless

on foreign capacity in China
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This is from 2020. TSMC at that time planned 80k in total, but I think they stopped at 40k right? (was it 20k 16nm and 20k 28nm?)
UMC at the time planned for 25k 28nm. Is that just 28nm or do they produce 40 to 90nm also?

hvpc said:

I would say your last statement could be a bit subjective. Most on this forum and those in China will probably agree with you that the latest American back fired and is fueling the growth of Chinese semiconductor industry. On the other hand, those you called "think tank guys" are also happy the sanction is working as they intended, which is to stunt and slow China's attempt at catching up to the leading edge nodes.

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They may have worked a bit too well.

-Shifted the consumption patterns of a massive market, from one with a high preference towards US high tech products to a more domestic preference.
-Damaged the reputation of US companies.
-Cost US companies billions in losses.
-Will cost the US thousands of high payed, high skilled jobs.
-It will create unwanted and unchecked competition to US companies.
-And will probably and ironically accelerate the development of China semiconductor industry as the Chinese are now more willing to go for breakthroughs than for the safest route.

Of course they are happy, these humanities graduates do not work for these industries, they just give themselves the job of speaking for the entire industry. So their paychecks is not in the line.

That is not me saying this, as now the semiconductor lobby is probably the weakest lobby in DC. lets think about that. If big pharma and the gun lobby were as weak as the semiconductor lobby is now Americans would have gun control laws and universal healthcare.

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tokenanalyst said:

Of course they are happy, these humanities graduates do not work for these industries, they just give themselves the job of speaking for the entire industry. So their paychecks is not in the line.

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It is another expression that I read on the internet a long time ago, but no uses anymore.

All it is to these American think tank people, it is just a dick measuring contest.

Since they invoke white supremacy, then the rules to the dick measuring contest is set by them too.

Conceited, abusive, and amazingly dumb. That is the American think tank and the IC war with China.

That's what Mao said. They fight their war, I fight mine.

We know who won. We know got annihilated.

tokenanalyst said:

They may have worked a bit too well.

-Shifted the consumption patterns of a massive market, from one with a high preference towards US high tech products to a more domestic preference.
-Damaged the reputation of US companies.
-Cost US companies billions in losses.
-Will cost the US thousands of high payed, high skilled jobs.
-It will create unwanted and unchecked competition to US companies.
-And will probably and ironically accelerate the development of China semiconductor industry as the Chinese are now more willing to go for breakthroughs than for the safest route.

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Not just the semiconductor industry. The de-Americanization is happening across the board

siegecrossbow said:

Read from a Chinese recruitment forum that Oppo terminated Zelenskyy because they were on the verge of success and their hire ups were threatened by US gov since it would eat into Qualcomm’s profit. Oppo is not as diverse as Huawei and if their phones get sanctioned it is pretty much game over for them. The running out of funding thing is just an excuse.

Luckily all the Zeke engineers will get snatched up by other firms, one of which is DJI, who is not scared because they already are on the blacklist.

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Not sure about 1 but your second point... yep... media already reported that many of their engineers found employment on the spot. Goes on to show how big the demand is for semiconductor talent nowadays:

但值得玩味的是，工作多年的张祥在接到公司解散通知后的几个小时内，就已经在朋友的引荐下找到了下一份工作。“现在公司内部有很多离职群，大家都在交流工作信息。”

21世纪经济报道记者注意到，在公司楼下，站着多家公司猎头瞄准机会与下楼的员工沟通。一名芯片公司猎头告诉记者，ZEKU的员工其中不少是来自于华为海思、紫光展锐、高通等芯片设计龙头资深人员，“我们都是来这边打探消息的，加一些员工进他们的离职群，大家都想要招聘到这些大佬。”

Good report on China's DRAM/NAND companies from Yole Group that summarizes the key players and companies in the supply chain...

YMTC has considerably intensified its efforts to work with Chinese equipment suppliers through a not-so-visible project code-named “Wudangshan” and recent funding – of the order of $7B – from its state-backed investors. Recently, YMTC could place crucial orders with local equipment companies, among which is Naura Technology – a supplier of etching and deposition tools that could help mitigate the lack of support from US companies such as Lam Research and Applied Materials.

In conclusion, the U.S. trade restrictions pose a significant challenge to China’s memory industry, which relies heavily on imported technologies. However, China has not shown any signs of backing down from its semiconductor memory ambition. On the contrary, with strong financial support from the government, Chinese memory companies can support local equipment vendors and speed up the development of leading-edge tools for NAND and DRAM manufacturing. Although the future of China’s memory industry remains uncertain, what is clear is that memory will continue to be a strategic priority for the Chinese semiconductor ecosystem, and China will do everything possible to keep their workhorse memory companies – YMTC and CXMT – alive and running.

gelgoog said:

HLMC also has 28nm. They have been developing a FinFET process for years but supposedly they are not manufacturing it yet.
Several Zhaoxin CPUs use HLMC 28nm process.

Right now there are 3 foundries in China with 28nm process. SMIC, HLMC (subsidiary of Hua Hong), and TSMC. More have plans to enter that segment but none have entered production yet.

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another 28nm, United Semi at Xiamen

tokenanalyst said:

They may have worked a bit too well.

-Shifted the consumption patterns of a massive market, from one with a high preference towards US high tech products to a more domestic preference.
-Damaged the reputation of US companies.
-Cost US companies billions in losses.
-Will cost the US thousands of high payed, high skilled jobs.
-It will create unwanted and unchecked competition to US companies.
-And will probably and ironically accelerate the development of China semiconductor industry as the Chinese are now more willing to go for breakthroughs than for the safest route.

Of course they are happy, these humanities graduates do not work for these industries, they just give themselves the job of speaking for the entire industry. So their paychecks is not in the line.

That is not me saying this, as now the semiconductor lobby is probably the weakest lobby in DC. lets think about that. If big pharma and the gun lobby were as weak as the semiconductor lobby is now Americans would have gun control laws and universal healthcare.
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To be fair, I think these restrictions would have worked quite well if they all came out at the same time in 2018. They gave too much time to Chinese companies to build up parallel track. That may have been the great lobbying efforts of SIA.

I do find it funny that US govt is now crying everywhere about unfair treatment of Micron. Did these people really expect China will never retaliate?

The most encouraging part of SMIC's earnings call is just hearing about new Chinese fabless guys making breakthrough in product designs and getting picked in China's vast supply chain. That's something people in Washington apparently did not anticipate. We had a chart of how much each company depends on China. Now that there is the implicit threat that any American product can be sanctioned, Chinese consumer electronics companies are more willing to take chance with domestic chip designers and makers. There should be more govt support provided for this transition period.

As SMIC increases its capacity & capabilities in the 28 to 90nm range, which is something I haven't thought as much before, what's the rationale to keep buying from Onsemi, TI & other American IDMs? Listening to the call, they talked about making all their products auto compliant, since customers do not want to multiple products. They want to have 1 product that can support automotive & other industrial sectors. So, SMIC understands the need to increase R&D in legacy nodes & advanced nodes. I would imagine there is a lot of that across the board in China. And they talked about providing more options for domestic fabless guys so they can go from 40nm to 28nm or 90 to 55nm. Things like that. All of this requires engineering talent. So, part of the additional national focus on semi industry is hopefully being able to recruit the best and brightest & train the brains that will support industry development for decades to come