China's "core" future: dual drive of policy and capital, focusing on the middle and high-end market

Column:Industry Trends Time:2017-04-25
With the rapid development of intelligent hardware and equipment in China, the market demand for integrated circuits is

With the rapid development of intelligent hardware and equipment in China, the market demand for integrated circuits is also increasing. However, at present, China is heavily dependent on foreign imports: the output value of integrated circuits is less than 7% of the world, but the market demand is close to 1 / 3 of the world. At present, the import volume has exceeded US $200 billion for four consecutive years. At the same time, the domestic integrated circuit industry is still at a low level. How should Chinese enterprises make efforts to seek breakthroughs? Let's understand!

Status quo: heavily dependent on imports, amounting to US $227.1 billion

According to the data released by the Ministry of industry and information technology, in 2016, China imported 342.55 billion pieces of integrated circuits, a year-on-year increase of 9.1%. The import volume reached US $227.1 billion, exceeding US $200 billion for four consecutive years, while the export volume was only US $61.38 billion, and the trade deficit reached US $165.7 billion.

The value of semiconductors consumed in China is more than 100 billion US dollars every year, and the market demand is close to 1 / 3 of the world, but the output value only accounts for 6% ~ 7% of the world.

According to the data of the General Administration of customs and research institutions, in 2016, China imported 381 million tons of crude oil, with an import amount of about 116.469 billion US dollars. Integrated circuits have surpassed crude oil and become the largest imported product in China.

Wei Shaojun, director of the Institute of microelectronics of Tsinghua University, pointed out that the existing and planned production capacity are basically concentrated at the 40-90 nm stage. When these production capacities are developed successively, it will cause excessive concentration of resources and structural surplus.

Ding Wenwu, President of the national integrated circuit fund, also suggested that "when developing the IC industry, all localities should avoid the phenomenon of blooming factories everywhere, and more importantly, they should avoid low-level duplication and mass rush to form a foam."

In recent years, the rapid development of intelligent hardware and intelligent equipment in China has played a strong role in driving the demand for integrated circuits, thus forming a huge market demand and showing a rising trend.

However, the entire industrial chain is seriously deficient in advanced technology, which also leads to the Chinese market's heavy dependence on the import of foreign high-end products, which puts forward urgent requirements for the localization and high-end process of products.

Opportunity: dual drive of policy and capital, boosting industrial development

With the increasing variety and popularity of intelligent terminals, the use of integrated circuits will no longer be limited to smart phones, but will be widely combined with smart homes, multimedia data centers and other industries. In the future, the demand for integrated circuits will be increasing, and its overall market potential is very huge.

The national integrated circuit industry development promotion outline clearly states that by 2020, the gap between the integrated circuit industry and the international advanced level will be gradually narrowed, the average annual growth rate of sales revenue of the whole industry will exceed 20%, and the sustainable development capacity of enterprises will be greatly enhanced.

The integrated circuit design technology in key fields such as mobile intelligent terminals, network communications, cloud computing, Internet of things and big data has reached the international leading level, and the industrial ecosystem has initially taken shape. To achieve this development goal, the necessary investment intensity is undoubtedly extremely important.

It is gratifying that, driven by both policies and capital, China's integrated circuit industry has developed rapidly in the past three years, with nearly 100 mergers and acquisitions in the industry. China's leading enterprises such as SMIC and Ziguang group have become large-scale. Meanwhile, international giants such as Intel, Qualcomm and Texas Instruments are gradually increasing their capital and technology investment in China.

Future: leading enterprises have made efforts to compete for the middle and high-end market

Although the development of China's integrated circuit industry has been driven by the rising market demand in recent years, the relevant departments in China are also committed to accelerating the localization process of the chip industry. However, judging from the current situation, the progress is still slow, and China does not have enough international competitiveness and status in the field of integrated circuits.

Fu Cheng, vice president of Shanghai Zhaoxin, said that China has indeed built a relatively complete integrated circuit industry chain, but it lacks competitiveness in the core areas. The manufacturing industry has a scale but poor quality, and the technology lags behind the international advanced level by 2-3 generations.

It is understood that China has not entered the top 20 IC enterprises in the world for the time being, and no field has been at the forefront. Therefore, although the industrial momentum is strong today, how to firmly and deeply cultivate in the industry has become the most important thing for enterprises to stand out.

However, the global semiconductor market had a good start in 2017. Data show that global chip sales in January increased by 13.9% year on year.

At present, the global integrated circuit industry has entered a period of major adjustment and transformation, and the concentration of the industry is constantly improving. Meanwhile, the domestic related companies have begun to "arm" themselves through various ways to resist the fierce external competition. For example, Spreadtrum communications, a subsidiary of Ziguang group, recently announced the establishment of a partnership with dialog, a European semiconductor company; SMIC is expected to start the research and development of the 7Nm process this year, which is the fifth semiconductor company in the world to declare its position to research and develop the 7Nm process. Next, the medium and high-end market will become the competitive point of domestic enterprises.