Overseas Enterprises Make Advice for Chinese Local IC Design Industry

"If you don't know what you really like, you will only be in this mountain." In the eyes of upstream and downstream companies in the design of overseas IC (integrated circuit), what are the features of China's domestic IC design industry? How should it develop? Although overseas companies have their own business stances, they also have a common starting point: We hope that the Chinese partner, a local IC design company, can succeed. Therefore, the opinions of overseas partners still have some reference significance for local companies.

Current status of China's IC design industry China's semiconductor industry is growing strongly (Figure 1), and the number of IC design companies in China is also growing (Figure 2). It is expected that the turnover of China's IC design industry will increase step by step (Figure 3), IHS iSuppli’s Senior analyst Gu Wenjun estimated in January 2012 that China’s IC design industry will not exceed US$10 billion by 2015, and there is still a huge gap between China’s IC demand and IC’s local supply capacity (Figure 4).

IC competition to a higher level IC design service company VeriSilicon chairman and president Dai Weimin believes that now the company's integration is getting higher and higher, and the current OSO (Original Solution Orchestrator), commissioning solution coordinator, is soon The concept proposed by former Gartner.) Higher than ODM (trusted design) and OEM (trusted manufacturing) levels, mainly reflected in the integration of applications and content. This level of integration is not something that every company can do. For example, the success of Apple products is reflected in the rich application and content, so the hardware can be done well, but the rich content is not easy, so Samsung and some manufacturers in China Taiwan are not easy to go upward. Now Google (Google) is also talking about content and acquiring Motorola hardware. In China, if Baidu, Alibaba, go down may be very powerful because of the user base.

For example, PCs in Taiwan, China are very strong, but there are problems with turning to smart phones/pads because the chips/chipsets are not strong enough and they lack content. China's millet phone has realized that it is content, not just the phone itself.

The domestic IC design capability is already at an advanced level. Dai Weimin believes that China's start up (startup company) is more than Taiwan, and its design capability is no worse than Taiwan. Many domestic design companies / design service companies do 40nm, dual-core design no problem.

Pan Jianyue, vice president of EDP (Electronic Design Automation) tool and IP (Intellectual Property) supplier Synopsys, and president of Asia Pacific, also believes that overall, China’s IC design companies are aggressive, and of course, their biggest foundation is to rely on China's market. Another reason is that, on average, domestic design companies have been established for a relatively short period of time and will have less intellectual property (IP) and design accumulation. Therefore, everyone dares to adopt new processes. “What I’m seeing in Asia right now is that when a new process comes out, such as the 40nm wave, according to our statistics, the number of 40nm design companies is adopted, and mainland China is walking in other Asian countries. In the front, that is to say, the number of companies using advanced technology in mainland China will be more than in Taiwan or South Korea.(Note: Of course, the level of the company is not the same, for example, Samsung, Taiwan’s MTK, and many other branches are Doing at the same time.) Visible, Chinese companies are adopting new processes more actively. This, on the one hand, means that "Chinese companies are more sensitive to new technologies."

On the other hand, due to the accumulation of some domestic domestic design companies is not enough, they can use advanced technology, design tools and IP help.

Wu Xiongang, president of IP, the core supplier of ARM, also praised sincerely that Chinese customers have gone very fast in high-end processor design. For example, Hass used Cortex-A9 as 8-core network SoC. This is for ARM. All are challenges, I do not know how to support Hass. However, Hass made a very strong chip performance. In addition, Skyworth Group also launched the first Android 3D TV based on the Cortex-A9.

The innovation of business model is very important. Actually, many companies have made different innovations based on Cortex-A9. For example, HP plans to launch "Redstone" concept server in the first half of 2012 and adopt Calxeda's 4-core A9 CPU. . At the end of 2011, Barcelona’s Supercomputing Center announced that it is working with nVidia, an ARM-based supercomputer and also based on the A9 processor; there are also some companies that are using the A9 for high-end smartphones and tablets.

However, "this is not everyone can take A9 to make a strong processor, but how to use good IP issues. Master the core technology of the chip is the key."

Dai Weimin also holds the same view: "Not necessarily all things must be original, and the introduction, digestion, and absorption are sometimes great innovations. Like the core of the original DSP core bought 6 years ago, now doing very well." It is learned that the core of the original 6 After purchasing the DSP core years ago, it has been upgrading to meet the needs of applications such as 3G/4G communication products. The ZSP400 series has been upgraded to the ZSP800 series.

In the aspect of industrial chain changes and integration with the industry chain, we should look further ahead. China’s biggest advantage is its market advantage, its vast population consumption capacity, and its ability to set its own standards. “I think we can set some business models. The innovation of the business model is lower than the pure technological breakthrough (difficulty), but it can combine the current market and make use of existing technology to make some products.” Dai Weimin said. For example, Apple does not have its own factory, touch screens are also others, and even touch concepts have been done by others.

Wu Xiong followed analysis, in fact, Apple did not pursue completely subversive innovation, but to break the industry's application habits to innovate. Apple's success is because its CEO (Chief Executive Officer) is crazy and his corporate culture tolerates him. Not all companies (including US companies) are allowed to do so. This is a cultural environment. If the culture of a company is to work step by step, there can only be routine innovations, and there can be no disruptive innovation. This expectation is somewhat too high if disruptiveness is desired in a conventional environment.

The ranking shift is a sign of an active industry in the IC industry, and you can see some companies ups and downs. Then, how does the "generation of champions" return to the king? Luo Zhengqiu, deputy general manager of Chinese business development at TSMC (Taiwan Semiconductor Manufacturing Co., Ltd.), looked at the issue from another perspective, thinking that this kind of ups and downs is the characteristic that the industry is active and emerging companies are full of opportunities. Some companies are in a turbulent situation. Actually, not only China has such a phenomenon, but it is a very common phenomenon in the design industry. As long as there is no change in the top two of an industry for 30 years, 40 years, or 50 years, "If China hasn't entered that industry, then don't go in." If the top ten in this industry is always changing, China may be The industry is not very familiar and China should go in. In fact, "any such market is a place where emerging countries want to enter, because such a market has not yet precipitated, or else the characteristics of this industry are not easily precipitated."

From the cottage to the brand's upgrade Then, some local companies that do not rely on the mountains should first aim at some relatively large quantities of products? Because after all, the cottage was a popular model in China. Luo Zhenqiu said that instead of doing simple cottages, you have to be unique and do things that you can grow alive and can grow up with. In fact, I really think about it. Everyone is talking about innovation. Actually, some products are not innovative, they are doing the same products as others, and then they use lower prices than others. This is not a healthy ecological cycle. Indeed, many companies start from the imitation and price wars, but they must upgrade at a certain stage and look for the positioning of their own products. This is no longer a simple imitation and requires a certain degree of differentiation.

How do SMEs grow up? The government advocates the restructuring of enterprises, but local companies have the phenomenon of “rather than a chicken head, not an phoenix tail.” What is the origin of this phenomenon? Because many companies can't die; in addition, Chinese people like to be bosses.

Compared with the time-to-market, time-to-market is much more important than time-to-cost. Because Moore's Law tells us that in the next 18 months, there will be more transistors integrated into the same chip, so the new performance will definitely be cheaper than yours. So when you want to be cheaper than others, there will be third parties, fourth parties, and fifth parties waiting in the back, so that in a few years, the profits of the products are getting thinner and thinner, leading to today's Foxconn OEM for Apple. Less than 2% of profits, PC industry foundry also 1% to 5%. Therefore, this concept of paying attention to prices needs to be changed. Everyone needs to develop some independent intellectual property and configurable products so that your product has certain advantages and differentiation. At the same time, it will reach the market first, set the right to speak - keep the price first, and then you consider How to do the next thing.

And when the price is actually very low, real profits do not reach consumers. For example, we have seen many multinational corporations. In the entire process of using patents, they did not actually give up the pursuit of profits. So the foundry of PC has only 1% to 5% of the profit, but Intel's gross margin in the third quarter of 2010 is 67%; Apple has controlled all of its hardware and software in its hands and put its product throughout its entire life cycle. Stage money was got. One of Apple's biggest competitors is Google. Google also thought of an idea to buy Motorola Mobile. Some companies, such as Samsung, Apple, etc., have played patent warfare. To put it bluntly, one thing that both Apple and Microsoft want to do is make Android become the most expensive OS (operating system) in the world. Then, if this continues, China’s related industries will be plundered by others. "Perhaps everybody's cycle of play may be three or five years. (Note: The premise of the author's understanding of this sentence is that Android's openness has been affected)." Therefore, it gives the Chinese industry a wake-up call. All foreign companies are very particular about the patent layout. They definitely don't want to spend 12.5 billion to buy a company. They must have thought about how to make money. come back. Google said that it does not do evil, but it certainly knows that we must not make money behind.

We should see a step farther than it is now that we all make mobile phones. For example, local company A has already taken half of the overseas B company's market, and that local company C is thinking of taking half of the local company's market.... Of course, this matter can be done, but does this kind of thing really make sense for the development of our semiconductor industry? This is a problem that company executives should think about. Moreover, China is currently in a relatively special stage. China is still a country that is willing to spend large sums of money and concentrate its energy on big events. So now a good combination is that there should be an interaction between the government and enterprises to ensure that some very important platforms, such as Life and health assurance platforms have been set up.

We have basically lost the right to speak in many areas. IP is not ARM or MIPS. DSP is not TI or ADI. Water has flown under the bridge. It doesn't matter, but there will be a lot of new ones. Platforms emerged. These platforms most needed some good cooperation between the government and the enterprises. In particular, there is no government-led approach in the areas of communications and life and health. The government can assume heavy responsibility, such as linking life and health with everyone's mobile Internet devices.

Looking for the advantages of local companies ARM Wu Xiongang said that the semiconductor industry in mainland China is actually sandwiched between Chinese Taiwanese companies and European and American manufacturers. On the one hand, high-end technology companies in Europe and America have strong capital, on the one hand the execution power of Chinese Taiwanese manufacturers (manufacturing capacity). Very strong, low cost. Local companies are exactly in the middle of the two. This challenge is great, but in turn it is not a bad thing. Why? As the mainland and Taiwan are blocked, the mainland has no way to take the low end. The Taiwanese foundry is strong, and it is not easy to fight prices, and there are no Taiwanese giants. Recently, when conducting market research, ARM found that in Shanghai, senior IC design engineers who have worked for seven or eight years or more have been paid more than Taiwanese, and some local ARM customers have already gone to Hsinchu, Taiwan to open R&D centers because there are The senior engineer is cheaper than China. This is a good thing. On the one hand, it shows that China's market has a high demand for senior design talents; on the other hand, it shows that China is no longer going to rely on low-end to replace costs.

Because we have our own ecosystem, including our mobile industry's own industrial ecosystem (QQ, Baidu, etc.), our products are not only sold to Europe and the United States, but also our domestic market, and the markets of developing countries in the third world. , so it is very good for local companies.