Posted on 10/28/2019 11:37:51 AM PDT by AdmSmith
Please use the sharing tools found via the share button at the top or side of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email licensing@ft.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found at https://www.ft.com/tour.
https://www.ft.com/content/94795848-e6e3-11e9-b112-9624ec9edc59
fficials in the US government have suggested issuing credit to companies such as Nokia and Ericsson to enable them to match the generous financing terms that Huawei offers to its customers, according to two people with knowledge of the situation.
The move is part of a wider push to fund a rival to the Chinese company, which is the largest telecoms equipment maker in the world, but which the US believes poses a security risk to it and its allies.
One senior government official said: “We gave up our superiority in making telecoms equipment decades ago, and now we are realising that this might not have been the best choice for national security reasons. Almost every department and agency is desperately looking right now for ways to get back into this game.”
https://www.ft.com/content/94795848-e6e3-11e9-b112-9624ec9edc59
Japanese electronics-maker Sony will invest in a new factory in Nagasaki Prefecture to produce semiconductor image sensors used in smartphone cameras, Nikkei has learned. The company aims to capitalize on growing demand for high-end cameras in the devices that will take advantage of ultra-fast 5G networks.
Sony plans to allocate 100 billion yen ($918 million) for the project in its budget for the next fiscal year, and to have the plant online as soon as the fiscal year that starts in April 2021.
At that point, it will be the company's first new semiconductor plant to go into operation in five years. Sony expects the market for image sensors to continue growing as smartphone makers equip their products with increasingly sophisticated cameras. It believes demand will also get a boost as next-generation 5G networks become more widespread, and self-driving cars and factory automation come into use.
Sony was the world's biggest image sensor maker in 2018, with a 50% market share. It aims to use the new plant to lift its global share to 60% by 2025. Rival Samsung Electronics, which commands a 20% share of the global image sensor market, is also expanding its investment.
https://asia.nikkei.com/Business/Companies/Sony-invests-900m-in-chips-to-seize-5G-smartphone-demand
Sponsored by GaN Systems in participation with China Power Supply Society (CPSS), China Power Society Science Popularization Committee and Tsinghua University, the annual challenge supports worldwide innovation in the power electronics industry leveraging the benefits of GaN transistors.
http://www.semiconductor-today.com/news_items/2019/oct/gansystems-291019.shtml
Fixed it:
Sponsored by GaN Systems in participation with China Power Supply Society (CPSS), China Power Society Science Popularization Committee and Tsinghua University, the annual challenge supports worldwide innovation in the power electronics industry leveraging the benefits of GaN transistors to China.
May2019
A world-class Chinese semiconductor industry would change everything. Still, China has been trying to develop a homegrown chip industry for decades and has little to show for its efforts.
Comprehensive Contestations (2015-2018): In part sparked by a joint letter issued by a dozen scholars requesting the country renew its support for semiconductors, China’s leadership recommitted to building a domestic chip industry. In 2014, the government set up the National IC Industry Fund, often referred to as the “big fund,” which the author believes will completely change the Chinese and global semiconductor industry over the next three years.
The National IC Fund adopts a different approach to supporting the semiconductor industry: “1) It seeks to support strong companies in the field, including the three industry leaders, providing them with opportunities to receive state funding. 2) The equity investment arrangement was designed to generally not interfere with the production and operations, ensuring the independence of the companies receiving state financing.”
Another major change: China’s top chip firms are now willing and able to pay top dollar for talent. “The industrialization of chips requires relying on top engineers that ask for millions of dollars in annual salary, rather than pinning their hopes on the selfless dedication of thousands of old experts who ride their bikes to and from work.”
https://chinai.substack.com/p/chinai-56-the-sour-past-of-china
Original
https://mp.weixin.qq.com/s/r6M5oEKecjOAGYds7beMhQ
A $29 billion fund would help.
A selloff in dollar bonds issued by two Chinese university-backed companies has revived concerns about the finances of such firms, as well as the strength of state support.
In the past week, investors have dumped dollar debt issued by subsidiaries of Tsinghua University and Peking University, the country’s top two tertiary institutions, pushing prices to record lows.
The financial woes affecting the two companies, one of them a leading semiconductor producer, highlight the risk arising from the murky regulatory oversight of a relatively obscure corner in China Inc.
The plunge shows a worrying loss of confidence for companies such as Tsinghua Unigroup Co., which is tasked with helping President Xi Jinping achieve his goal of challenging the U.S.’s global dominance in technology.
“Chinese companies are offering two to three times [Taiwanese engineers’] current salaries to work for them,” said an unnamed Taiwanese engineer in a recent interview with Japanese media Nikkei.
In August 2018, Taiwan’s Central News Agency reported that Nanya Technology, a Taiwanese maker of DRAM chips, lost 48 of its senior experts to China in less than two years. DRAMs are semiconductor memory chips within digital products that store data.
Inotera Memories, another Taiwanese DRAM maker, saw 400 of its employees leave for China after the company was acquired by U.S. tech company Micron in 2016.
Building up China’s ability to develop and manufacture its own semiconductors is a key goal of the government’s “Made in China 2025” strategy issued in 2015. The plan seeks to catapult China to the forefront of the world’s modern economies, but the trade war with the U.S. that has seen bans on chip exports to major Chinese companies has added new urgency to the effort.
Made in China 2025 sets self-sufficiency goals for semiconductors at 40% for 2020 and 70% for 2025.
Self-sufficiency is viewed through the lens of national security. But China had reached only 15% for semiconductors in 2018, putting the targets in question.
“While U.S. pressure may affect the operations of companies such as Huawei Technologies in the short run, on a medium- to long-term basis, Chinese manufacturers will increase procurement from within China, and it will result in the growth of domestic equipment and materials makers,” said Lung Chu, president of industry association SEMI China.
The country is slow in developing semiconductor production equipment and materials. But China has produced the likes of HiSilicon, a world-class semiconductor designer owned by Huawei.
On January 16th 2018, Beijing-based NAURA Microelectronics Equipment successfully acquired the surface preparation business of Pennsylvania-based Akrion Systems. Upon completion of the transaction, the new entity NAURA Akrion Inc. became a subsidiary of NAURA in the United States.
On Dec 3rd, 2018, China’s Wingtech Technology announced plans to jointly acquire a controlling stake of Dutch semiconductor company Nexperia, with investors including Gree Electric Appliances.
As one of the world’s largest phone ODMs, Wingtech’s move towards the upstream in semiconductors not only ensures its supply chain stability on key semiconductor parts, but also enhances the company’s core business competitiveness.
https://syncedreview.com/2019/04/26/the-10-biggest-semiconductor-ma-deals-in-2018/
Most Chinese semiconductor startups are operating on a net loss, and analysts expect this may last into the next two years. Further, the United States has placed export controls on close to a dozen AI and machine learning technologies. Chinese semiconductor companies are however catching up, propelled by multiple government policies, a firm push in R&D, and massive capital injection.
There are two primary application fields Chinese chip companies cater to: Security and Smartphones. China will have over 600 million security cameras by 2020. The country’s compound annual growth rate for Security from 2018-2022 is estimated at 22.6 percent, with wide-range applications in public security, urban transportation, eco-architecture and industrial parks.
Chips are the most expensive component in video surveillance. A typical device set requires four types of chips: two types of SoC accelerators, one for deep learning, and an ISP chip. Most current AI chip solutions use GPUs, but more FPGA/ASIC solutions emerging for example from Cambricon and DeePhi, while Huawei Hisilicon has become a big player in specialized SoC.
Chinese startups lack the experience of large semiconductor companies with CPU, GPU and FPGA designs, therefore ASICs are seen as a catch-up opportunity. Current Chinese companies in this field include:
Bitmain (Series B+ $440 million, 2018-08)
Cambricon (Series B Hundreds of million approx., 2018-06)
Horizon Robotics (Series B $600 million, 2019-02)
Kneron (Series A+ $18 million, 2018-05)
NextVPU (Series A $28.82 million, 2018-10)
Easytech (Series A Undisclosed, 2019-03)
DeePhi Tech (Acquired by Xinlinx, 2018)
Huawei HiSilicon (Established in 1991)
Baidu
Alibaba
Hikvision
https://syncedreview.com/2019/04/20/a-look-at-chinas-growing-semiconductor-industry/
The consolidation of silicon manufacturing into two main foundries raises the threat level, pointed out Diane Bryant, former Intel and Google Cloud executive.
“You really just have TSMC and Samsung left,” she said. “And TSMC is in Taiwan, so you have to be thinking about China and the threat to Taiwan, and what will happen to TSMC.”
China will take over Taiwan “the same time North Korea takes over South Korea,” quipped Hennessy, giving it control over most of the world’s semiconductor manufacturing capabilities.
“What do you do tomorrow if TSMC and Samsung are off limits?” he asked his fellow panel members.
“You can’t go to Global Foundries,” which indeed has some U.S. semiconductor manufacturing capability, said Bryant, “unless you really want Moore’s Law to be dead.” (Global Foundries recently stopped developing the most advanced semiconductor processes.)
Rodrigo Liang, CEO of SambaNova Systems, argued that fixing this problem can only be done at the level of the U.S. government.
https://spectrum.ieee.org/view-from-the-valley/semiconductors/devices/semiconductor-industry-veterans-keep-wary-eyes-on-china
Two major types of chips that the Chinese are keen on being able to build are memory-focused chips such as NAND and DRAM. China already seems to be closing the gap in the manufacturing of NAND, a non-volatile memory chip utilised for storage in all things ranging from 16GB MicroSD cards to high-performance SSDs. Yangtze Memory, a state-backed chipmaker which was reported recently to have started volume production of the country’s first homegrown 64-layer 3D NAND flash chips.
But for advanced CPUs and DRAM, thecountry lags behind its global counterparts. The biggest chip manufacturing company in China, Semiconductor Manufacturing International Corporation (SMIC) started manufacturing CPUs based on 14nm technology in 2019 whereas TSMC in neighbouring Taiwan is producing high-performance CPUs on its 7nm process. In fact, TSMC is starting a US$19.6 Billion 3nm fab in S. Taiwan. In fact, all leading fabless semiconductor companies such as Qualcomm, Nvidia, Advanced Micro Devices (AMD), MediaTek, Marvell and Broadcom are customers of TSMC.
- - -
The Indian government is certainly working to promote the manufacturing of chips in the country, and may also look to capture a small share of chip manufacturing market given US silicone designers may look to India for manufacturing needs. The incident is a lesson for India in self-reliance, where a government fund can be used to boost the semiconductor ecosystem.
https://analyticsindiamag.com/china-chip-manufacturing/
China’s biggest maker of computer chips, Semiconductor Manufacturing International Corp., placed the order with ASML in April last year for its cutting-edge machine, which is needed to produce the latest, most powerful chips. But that shipment is now “pending later notice,” three people close to the situation said.
German Foreign Minister Heiko Maas on Monday cast doubt on whether Chinese telecom equipment vendor Huawei Technologies could participate in the development and construction of the country’s fifth-generation data network (5G)
Maas told reporters in Berlin that Huawei was a company dependent on the Chinese state due to its national security laws, which meant Huawei was obliged to pass on information to the government there.
Germany therefore wants to add a test of trustworthiness to the 5G security catalogue that so far had mainly envisaged an evaluation of technical criteria, Maas said.
In this test of trustworthiness, German authorities will examine if a company is forced by law in its home country to pass on information and data that actually should be protected, Maas said, adding: “That’s the case with Huawei.”
Thanks AdmSmith.
Read this thread about semiconductors: “Some of the demand that we got in the 4th fiscal quarter was inventory builds from China”
https://twitter.com/TeddyVallee/status/1192247319804207106
Very bad:
China’s EpiWorld expands SiC epi foundry with new Aixtron AIX G5 WW C high-volume deposition system Deposition equipment maker Aixtron SE of Herzogenrath, near Aachen, Germany says that in third-quarter 2019 it shipped and installed an AIX G5 WW C high-volume manufacturing system to pure-play silicon carbide (SiC) epitaxial wafer foundry EpiWorld International Co Ltd in Xiamen, China (a privately owned joint venture with investors in the USA, Japan and China) for the further development of SiC epiwafers (used mainly for manufacturing power devices for automotive applications).
Based on Aixtron’s production-proven, fully automated Planetary Reactor platform, the AIX G5 WW C MOCVD system is said to have the largest batch capacity and highest throughput in the industry. Offering flexible 6-inch or 4-inch configurations, the design is targeted at squeezing production costs to a minimum while maintaining excellent production quality.
EpiWorld aims to further expand its production capacity to meet increasing customer demand. The firm has already completed production lines for 4- and 6-inch SiC epiwafers for manufacturing 600V, 1200V and 1700V power devices.
“In recent years, we have been qualified as a leading supplier of SiC epitaxy wafers by device manufacturers in the automotive and various other sectors. Therefore, we have a strong footprint in one of the most challenging industries. We had so far served over 100 customers around the world,” says EpiWorld’s general manager Dr Gan Feng. “With this new addition, our annual capacity will be increased to 60,000 wafers in 2019. Our recently completed phase I expansion of an 18,000m2 new facility is designed to provide manufacturing space for an annual capacity of up to 400,000 wafers,” he adds.
http://www.semiconductor-today.com/news_items/2019/nov/aixtron-071119.shtml
China is accelerating the public listings of chip companies on Shanghai’s more loosely regulated STAR stock market in the latest initiative by Beijing to counter U.S. technology sanctions and speed the development of its high-priority semiconductor industry.
Worried about the health of the banking sector, given bad loans that increased by 10% in the first half of the year to 2.24 trillion yuan, the central bank said in June that it “would support companies to leverage financial markets and explore more fundraising channels.” STAR is one of those channels.
Crucially, by providing an exit for early stage investors via IPOs, venture capital may be encouraged to resume investing in startups. That could provide a shot of much-needed adrenaline for private financing of Chinese technology companies, which has stalled recently.
China’s bid to increase semiconductor self-sufficiency will take a step further - albeit a small one, perhaps - as homegrown DRAM maker CXMT is ramping up 19nm production by the middle of 2020.
https://www.digitimes.com/news/a20191113VL201.html
Nearly a quarter of German companies operating in China are planning to relocate all or part of their business out of the Asian country, according to a study released Tuesday by the German Chamber of Commerce in China.
The annual survey of 526 member firms in China found that 23% of them have either already decided to withdraw production capacity from the country or are considering it. A third of those companies have planned to leave China entirely.
The rest say they will transfer part of their business and production overseas, largely to lower-cost countries in Asia.
Operating costs in China have been rising as the country seeks to rebalance its economy from an export and investment-led model to one driven by services and consumer spending.
Of the 104 companies that have decided to leave or are considering doing so, 71% cite the rise in production costs — particularly for labor.
https://www.dw.com/en/german-firms-in-china-a-quarter-are-planning-to-leave/a-51208547
Another company for the list:
Gigaphoton Inc., a manufacturer of light sources used in semiconductor lithography, has announced the establishment and start of business for a new company GIGAPHOTON CHINA Inc. in China.
Until now, Gigaphoton’s service support in China has been conducted by Komatsu Industries Shanghai Ltd.’s optical machinery division. To expand business in China and strengthen governance, Gigaphoton China was established as a subsidiary of Komatsu China Ltd., the regional headquarters of Komatsu, which is the parent company of Gigaphoton. From November 1, control of operations is transferred from Komatsu Industries Shanghai to Gigaphoton China Inc.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.