2022年1月20日

Why are chips hard? Why is it important? Where is the “jam neck” card?

Pain point | “core” for the war ① why chip is important? Where is the “jam neck” card?

[Editor’s Note]

One core stirs the world. The domestic chip investment boom seems to be cooling, and the global electronics enterprises are in a “lack of core” crisis. A fire in Japan’s Renesas Electronics, the world’s three largest vehicle semiconductor companies, may result in a global production cut of more than 1.5 million vehicles.

Will the chip crisis reshape supply chains? How should Chinese enterprises find accurate positioning? How to allocate investment? The paper news industry observation and industry investigation column “pain point” launched today “core” war “special topic, through the interview of experts and industry insiders, combing the current global chip situation, dismantling investment layout, to explore the” chip “supply solution.

Today, we can’t live without chips all the time. When we hold the remote control to turn on the TV, when we hold the mobile phone to talk to the outside world, when we work on the computer, everything behind the chip is working.

The world’s first integrated circuit was born in 1958, has a history of more than 60 years, the global semiconductor industry from then on, integrated circuit, microprocessor, computer, operating system, Internet, mobile phone and a series of great invention, completely changed the way we live, the human society from the mechanical industrial age into the information age.

Chip is the cornerstone and heart of the whole information society, and it is also the engine to promote the development of the whole information society.

Today, the semiconductor industry has become one of the most important industries in the world. According to the statistics of WSTS(World Semiconductor Trade Statistics Organization), the global semiconductor market sales reached $440 billion in 2020, with a year-on-year growth of 6.8%.

Data showed that China’s imports of integrated circuits reached 543.5 billion in 2020, up 22.1 percent year on year, and total imports reached 2,420.7 billion yuan, up 14.8 percent year on year. Export volume of integrated circuits reached 259.8 billion yuan, up 18.8 percent year on year, and total export volume reached 805.6 billion yuan, up 15 percent year on year.

Why are chips hard?

In 1947, the United States invented the transistor, after Texas Instruments engineer Jack Kilby came up with the genius of the idea, all the components are made on the same material, and connected into the circuit, so the integrated circuit was born. The matrix used to carry an integrated circuit is a silicon chip, which lies between a conductor and an insulator, so it is also called a semiconductor. So when we talk about chips, integrated circuits and semiconductors, we mean the same thing.

Jack Kilby, also known as the “father of the chip”, was awarded the Nobel Prize in 2000 for his invention.

Why are chips so hard to break through? Chip itself is a very high technology barrier industry. If you think about it, a cell phone SoC chip is only the size of a fingernail, but it has more than 10 billion transistors integrated into it. How difficult is this process?

The chip has a very long industrial chain, and every link of the industrial chain must be interlinked with each other, and the requirements are very high. The error of any link may lead to the failure of the chip to meet the standard.

As an example, in 2015, apple’s iPhone 6 s carrying the A9 chips, apple actually handed the A9 chip respectively to samsung and Taiwan semiconductor foundry, samsung used 14 nanotechnology, TSMC used 16 nanotechnology, samsung 14 nm is arguably more advanced, but in fact, many users using TSMC A9 chip iPhone 6 s more save electricity.

The rapid progress of the chip industry in recent years can be attributed to the development of the smartphone industry. In the absence of major breakthroughs in battery technology, improvements in mobile phone battery life are expected to result from a reduction in chip power consumption. Intensious competition in the mobile phone market has spurred constant innovation in chip technology, from 16nm, 14nm, 7nm to now 5nm, with the latest technology being used first in mobile chips.

The chip industry chain can be roughly divided into design, manufacturing and packaging and testing, but there are a number of very important side branches, such as manufacturing equipment and materials in the manufacturing link, and EDA design companies at the chip design end. Each of these leading companies is irreplaceable, and only in the end can the global chip industry chain run. Whoever is missing will have a huge impact on the whole industry in the short term.

At present, mobile phone chip is the most difficult and complicated chip.

According to the updating frequency of mobile phone chips, flagship chips are iterated once a year, which puts forward high requirements for enterprise research and development and innovation ability. If a chip fails to perform well in the end, the sales of mobile phones will be affected.

At the same time, the chip industry is a capital – intensive industry. The cost of developing a flagship SoC mobile phone chip is in the hundreds of millions of dollars. It was previously reported that Huawei’s Kirin 980 R&D cost was around $300 million, so Qualcomm and Apple’s chip R&D cost should not be lower than Huawei’s, after all, foreign companies have higher labor costs.

Chipmaking is an asset heavy investment. Take TSMC for example, the capital investment of TSMC is expected to reach $20 billion by 2020. Such high capital investment made many enterprises unable to afford to invest, and the foundry industry of chips became more and more concentrated. More and more orders were handed to TSMC, and even Intel began to give some orders to TSMC, thus creating TSMC’s current position in the industry.

So the technology-intensive and capital-intensive nature of chips leads to fewer and fewer players, and ultimately it’s a winner-takes-all situation.

The global chip giants include Intel, AMD, Qualcomm, Samsung, Taiwan Semiconductor, Huawei and so on. These big players, whether in terms of technical strength or financial strength, make it difficult for other enterprises in the industry to catch up with them. Moreover, each of them has their own strengths.

Originally, the chip industry was an industry with a high degree of division of labor and cooperation in the world, and the most sufficient “interdependence among each other”. However, the United States’ crackdown on Huawei has caused the biggest change in the chip industry.

Chip pattern differentiation

Chip was first born in the United States, although the chip industry has formed a global division of labor and cooperation mode, but the United States is still far ahead of the world.

Currently, the chip industry is still the most important in the United States, with a large number of powerful companies dominating the development of the entire industry. Apple, Intel, Nvidia, IBM, Qualcomm, Texas Instruments and Broadcom are the top seven US $700 million technology companies in the United States, all of which are the leading companies in the chip segment.

In an earlier interview with The Paper, Dai Baojia, former founder of Ridetec and now CEO of Optec, said that the reason why the US is ahead is that it has a large number of talents and high efficiency in research and development. In addition, American universities and industrial sectors work closely together to train talents and export technologies for the industrial sector.

“The technology of many American universities is very strong, and there are good cash channels, so the profit distribution is reasonable. The US universities work very well with companies and are much stronger than we are.” Dai sees American universities as an important force to keep the U.S. chip industry ahead.

Ren Zhengfei, founder of Huawei Technologies, recently visited a number of universities in China to promote technology and talent cooperation between Huawei and universities after the company was sanctioned by the United States.

Outside the United States, there are top chip companies, but they are not nearly as numerous or as broad.

European lithography company ASML is the best known in the field of chip equipment, with 80% of the market. Of course, Europe’s three analog chipmakers, NXP (spin-off of Philips), Infineon (spin-off of Siemens) and STMicroelectronics (spin-off of Thomson), also occupy a high market share.

Japan is home to many materials and upstream component companies. Renesas Electronics, Japan’s analog chip; In the field of equipment, Canon and Tokyo Electronics; Material field: Shin-Etsu Chemical (silicon wafer material), JSR(photoresist), JX(target material), Hitachi Chemical, Asahi Chemical, Sumitomo Chemical and other dozens of companies, accounting for 50% of the global semiconductor materials market.

South Korea has two storage giants, Samsung and SK Hynix, which account for 80% of the memory chip market.

The generation of Chinese Taiwan and seal test have an advantage. TSMC is the world’s largest integrated circuit foundry; ASE is the world’s largest sealing and testing factory. MediaTek is the world’s second-largest independent mobile phone chip company.

Mainland China has a wide range of layout in the past two years, but its strength is not strong. In the field of chip design, Huawei’s Hays should be the first team in the world. The latest chip adopts 5 nanometer technology, which is synchronized with the world. SMIC’s latest process is 14 nm, two generations behind TSMC’s. In the field of mobile phone chips, Unisplendour is the world’s third-largest independent mobile phone chip company.

Where is the “jammed neck”

As the US clamps down on ZTE, Huawei and many Chinese high-tech companies, some technologies and products cannot be provided to Chinese companies without US permission, and China will not be able to find non-US substitutes in the short term. This is the so-called “jam neck” technology.

There is a point of view that China’s chip congenital deficiency, this also has a certain truth. As a catch-up, China only started to develop chips in the 1980s, many years later than others. At that time, overseas technology was already mature, and many technologies were directly used. Standing on the shoulders of giants, China felt no need to start making its own set of chips.

In addition, semiconductor division of global cooperation, the trend at that time was also to find comparative advantages, China to do their own good things first.

China’s consumer electronics chip is doing quite well, with two mobile phone SOC chip companies such as Huawei and Spreadtrum, as well as a large number of chip design companies. In addition, China’s closed testing also occupies a high market share in the world.

However, under the current situation, some US technologies and products are no longer available to Chinese companies, which has led to the phenomenon of “bottleneck”.

The term mainly refers to high-end chips, such as SOC chips for mobile phones, in which some of the high-end components must be made from U.S. products or technology. Some low-end chips, such as home appliances and air conditioning chips, do not have the problem of neck jam. Some other national defense security use chip, the volume, speed and other requirements are not high, do not need to use the latest chip manufacturing process, will not be jammed neck.

Huawei, for example, has suffered most from the U.S. crackdown in its consumer division, where Kirin’s chips have temporarily stopped being made. The reason is that TSMC, which makes Huawei’s Kirin chips, has technology from the United States and must obtain authorization from the United States to make chips for Huawei.

Wear it also think that China’s comparative advantage strategy before and there is no problem, all around the world are difficult to chip it yourself, or need to division of labor, “meaningful you do you do, economically more efficient company in the United States should do in the United States, involving national security exception, all do not the best way to himself. It is also painful for them to replace Chinese products. China is doing well in everything from base stations to cell phones. For example, if Huawei does not ship, the global operators will be greatly affected. “

But who could have predicted that the industry’s relative balance, based on the “there’s something in me, there’s something in me”, would be upset by politics.

Huawei’s high-end chips are hampered by the fact that TSMC alone cannot make chips for Huawei. China’s own SMIC, of course, is a bit behind TSMC in the manufacturing process, but it can already mass-produce 14-nanometer chips, a technology that can be used in everything from base stations to high-performance computing to solve the problem of bottlenecks.

Not only manufacturing this end, the chip design tool EDA is also an American company, if there is no this tool, is not designed chip. There are also design tool companies in China, but they cannot completely replace the American EDA, especially some high-end chip designs still need the American EDA tools.

Zhou Ling is a reporter from thepaper.cn

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