Government building chips fall cruel-hearted autonomy, to $170 billion over five years

as the world’s largest producers of electronic products, China is still not so far with independent complete chip industrial production system. Use of foreign chip not only led to poor profit electronics manufacturers, inevitably leads to more national security vulnerabilities. Through the clever use of capital and pressure, the Chinese enterprises with the help of the government is catching up.

China mass production for the world, including smart phones, computers, complex network equipment, electronic products. China is now redouble our efforts to design and produce these electronic products the core values: behind the chips.

the Chinese companies are trying to catch up the international market competition. Last year, China imported $232 billion of semiconductor products, and China’s oil but imports.

in order to shorten the gap, Beijing launched a number of increasing national investment plan and from foreign chip manufacturer hunting expert.

the Chinese government decided to set up independent chip production system

the government also shows the corresponding determination. Vice premier of the state council Ma Kaizheng led a commitment to make the chip industry in China in the 2030 years become the world’s first special groups. According to a McKinsey report in June, the special group is composed of four government departments personnel, is expected to be received government funding to $170 billion in its spending over the next five to ten years.

deputy prime minister ma kai

large economic research and consulting firm Rhodium group’s founding partner Daniel h. Rosen says: “because of China’s semiconductor products, especially the production of almost all electronic products need to be in the country’s high-end chip is entirely dependent on imports, establishing independent chip industry system requirements exist for a long time. Now, this kind of demand become urgent and practical.”

before the national security agency employee snowden disclosure of information about the U.S. government monitoring network more to deepen the national security concerns. This situation caused the wide, the Chinese government officials for possible due to import hardware, such as external chip, causing national security concerns.

executives and analysts believe that the leak is very possible, at least in part level, caused the antitrust investigation into qualcomm recently. Follow up the survey of lawyers and analysts believe that the antitrust investigation is likely to end in fines and force qualcomm to lower their end for Chinese companies to use its technology.

in recent months, the Chinese government launched against food, cars and technology of multinational companies the climax of antitrust and price manipulation probe. Qualcomm problem is just a part of the wave. This also shows that China’s investigation is with a wider range of economic and strategic initiatives.

“the Chinese government for qualcomm because other countries similar survey and has good credibility,” indiana university Chinese political Scott Kennedy, director of the center for business research said: “but if such a survey could force a qualcomm reduce technology license fees for Chinese companies or some technical sharing agreement, so this survey is apparently in China’s industrial policy goals accordingly.”

China chip industry development under the government support

on foreign enterprises at the same time, China is in the full development of the country’s chip industry. In the past 15 years, the Chinese government subsidies, funding, and even directly give priority to their potential chip maker.

in order to obtain sufficient fully trained engineers to form complex production line, the founder of China’s major chip manufacturers smic, the construction of the facilities such as bilingual school to attract overseas talent. As a Christian, smic’s founder, built a church to meet accustomed to the company sponsored the bible study and other activities of the Christian faith of the workers’ demand in Taiwan.

under the government’s subsidies, though still lack to compete with Intel, samsung and TSMC circuit scale and technology, smic since it was established in 2000, became the major chip manufacturers in China. And funded by the government in 2000 before and after other chip companies have turned to producing cheap smart phones with chips, their size relative to the qualcomm, still too small.

Chinese companies benefit from the competition by Intel and qualcomm

in September, the surge in market competition of mobile phone chips lagged qualcomm Intel and thunis signed a $1.5 billion investment contract. Last year, thunis to two Chinese chip design, exhibition XunTong sino RuiDi division, invested $2.7 billion. Analysts believe this investment is China trying to make thunis domestic chip industry leading signal.

as tsinghua holdings subsidiary, thunis prospects. At the same time, tsinghua holdings controlled by China’s top university of tsinghua university spin-off subsidiary.

as part of the deal, Intel got a 20% stake in spreadtrum communications, they will collaborate to develop chips and wireless technology. The investment will help Intel to tap China’s huge mobile phone market, and spreadtrum communications will also through cooperation with Intel engineers learn valuable techniques and skills.

this is bad news for qualcomm. Situation will force qualcomm to seek the cooperation with Chinese enterprises to carry out the further to avoid under more pressure from the government.

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