Fang Chen - Deciphering Chinas Microchip Industry
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CHEN Fang
Dong Ruifeng
Published by
World Scientific Publishing Co. Pte. Ltd.
5 Toh Tuck Link, Singapore 596224
USA office: 27 Warren Street, Suite 401-402, Hackensack, NJ 07601
UK office: 57 Shelton Street, Covent Garden, London WC2H 9HE
Library of Congress Cataloging-in-Publication Data
Names: Chen, Fang (Reporter), author. | Dong, Ruifeng, author.
Title: Deciphering Chinas microchip industry / CHEN Fang, DONG Ruifeng.
Description: Singapore ; Hackensack, NJ : World Scientific, [2020] | Includes bibliographical references.
Identifiers: LCCN 2020013216 | ISBN 9789811217210 (hardback) | ISBN 9789811218415 (paperback) | ISBN 9789811217227 (ebook for institutions) | ISBN 9789811217234 (ebook for individuals)
Subjects: LCSH: Integrated circuits industry--China.
Classification: LCC HD9696.I583 C644 2020 | DDC 338.4/762138150951--dc23
LC record available at https://lccn.loc.gov/2020013216
British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library.
Originally published in Chinese by Posts and Telecom Press
Copyright Posts & Telecom Press 2018
Copyright 2021 by World Scientific Publishing Co. Pte. Ltd.
All rights reserved. This book, or parts thereof, may not be reproduced in any form or by any means, electronic or mechanical, including photocopying, recording or any information storage and retrieval system now known or to be invented, without written permission from the publisher.
For photocopying of material in this volume, please pay a copying fee through the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, USA. In this case permission to photocopy is not required from the publisher.
For any available supplementary material, please visit
https://www.worldscientific.com/worldscibooks/10.1142/11745#t=suppl
Desk Editor: Dong Lixi
Typeset by Stallion Press
Email:
Printed in Singapore
Contents
About the Authors
CHEN Fang is a senior reporter at Xinhua News Agency and a winner of the Top Ten Editors laurel. Chen has been engaged in reporting about macro-economy, science and technology events for a long time, and is dedicated to the investigation and research of major and focal issues. Many of Chens works have earned her awards in Chinese journalism.
DONG Ruifeng is a Chief reporter at Xinhua News Agency. Dong has been engaged in current affairs reporting for a long time. He focuses on writing scientific and technological reports. Many of Dongs works have won him China Science and Technology Good News Award.
Preface
T he survival race looming in Chinas semiconductor industry is becoming ever so nerve-racking and gut-wrenching.
On 16th April 2018, the United States Department of Commerce (DOC) launched a 7-year export restriction on ZTE Corporation, banning US suppliers from selling high-tech components and software products to the Chinese company. The news startled China. Even journalists who had been closely tracking technology events were surprised that the US government would target a Chinese enterprise and that Chinas second largest as well as the worlds fourth largest telecoms company could be devastated by this sudden attack.
From the 301 investigation to the extra tariffs list to an all-round export restriction on core semiconductor components, the US is turning up the heat in its confrontation with China.
There are more than one signs that showed that the ZTE incident is not an isolated happening, and Chinas semiconductor industry is not the only pressure point in this power game. Instead, it is just one punch among a series of well-designed attacks, or one move in a scheming chess game. All of these deserve a scrutiny from both a historical angle and a macro, global perspective.
Microchips are the cornerstone of the modern industrial and information society, the core technology of which is so pivotal in a countrys sustainable leadership that no ambitious country can afford to be locked in a cut throat competition.
Chinas information technology (IT) industry has been on an exponential rise for the past several decades. However, its semiconductor industry, especially in the core and advanced fields, has not seen a substantial progress which could enable it to compete on a par with the worlds leading players. Chinas behindhand in semiconductors has been for a long time a typical Gray Rhino neglected by many.
In the global arena today, independence and controllability of core technologies has become a major strategic concern when it comes to national security. It is high time for Chinas microchip companies to stop the old practice of following the footsteps of others.
However, should they devote time, energy and money into developing core technologies which have long been dominated by the West? How can they balance the pursuit of technology and the demands of market to make valuable and profitable products? What stories and lessons are behind Chinas semiconductor industry being blocked by the US ? These questions are what we will bear in mind as we delve into the history of Chinas semiconductor development, and we will find them existent and explored even back then.
China is well aware of the strategic significance of semiconductors in both domestic development and international competition. It has tried to draw lessons from Americas practice of market competition, Japans innovation of industrial guidance and Koreas success of capital support, but to replicate prosperity in a different country at a different time seems to be not very promising.
Many would think that Chinas semiconductor industry has missed the golden age of industrial development in the latter half of the last century, therefore it is natural and necessary for the newcomer to climb more and higher mountains within a shorter period of time in order to catch up with the forerunners. Sometimes, unusual strategies and approaches are necessary. For example, Chinas Ark, Loongson and Sunway have proved that mastering core technologies to build up competitiveness is a long-term process of accumulation, which demands patience, perseverance and big investments.
Others think that the ZTE incident is an acid test for Chinas science and technology industry and that China is exposed as untenable under such a test. However, it is rather rash and risky to take such a polarized and prejudiced stand. It is true that China has a long way to go compared with other science and technology powers in the world, but at the same time, the potential it presents is also admittedly remarkable.
Whats more, innovation has always been a trial and error process that requires constant design and redesign, thinking and rethinking. Only through careful selection of markets and learning from mistakes can products be improved and technology be optimized.
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