LONDON – China's fabless chip companies are turning to Taiwan to a greater degree to help them get close to the leading-edge in geometry and compete globally, according to an IC design house and fabless chip company survey conducted by EE Times-China.
Some 9.2 percent of China's fabless chip companies are producing digital ICs using 45-nm or below process technologies, according to the survey.
"In the past decade, we have witnessed the emergence and rapid growth of mainland China's IC design industry. When we first started our survey in 2002, only 20 percent of local IC design firms used 0.25-micrometer or below process technologies, while over 72 percent of their counterparts in the U.S. used 0.18 micrometer or below technologies. Even five years ago, the industry was at least two generations behind the U.S. in terms of process technology," said Brandon Smith, publisher of EE Times-China, in a statement.
While 23.2 percent and 27.5 percent of respondent companies are using 0.13 micrometer process technologies to make analog and mixed signal ICs, respectively, these two sectors continue to be dominated by 0.18 micrometer and 0.35 micrometer processes.
Of the survey respondents that use foundry services 63 percent use foundries based in Taiwan, which compares with 57 percent in 2010. And 33.1 percent work with TSMC compared with 30 percent in 2010. Meanwhile 18.9 and 15.0 percent say they work best with the Chinese foundries SMIC and CSMC respectively.
The survey also shows that 57 percent of mainland China's ICs are used for consumer electronics products such as mobile phones and tablet PCs. This market sector is characterized by rapid innovation and intense competition, which is expected to continue to drive the fast development of the local IC design industry.
EE Times-China is published by eMedia Asia Ltd., a joint venture between Global Sources Ltd. (60.1 percent) and UBM plc (39.9 percent), which is the publisher of EE Times and EE Times Confidential
Is this really surprising as the biggest foundries are in Taiwan, so a large chunk of any country's fabless manufacturing will end up there. I just pulled open a Huawei 3G to USB router and saw a Broadcom main chip, Spansion Flash, Hynix DRAM. Not sure how much they sold it for, but the Oz mobile company charged $100 and probably made much more profit that the manufacturer. In the meantime, the companies still in manufacture will eventually get their own outlets and hone their skills as electronics retreat in Western economies. Electronics show in Melbourne next week; it is going to be interesting to have a look at what is still made here. Anyone else could have bought the same chips which were not from China originally, but they did not. Embedded software development in the West has retreated to military where outsiders are excluded and competition is less. Thankfully there is no "wine equalisation tax" in electronics, but markup as too high in the West, even on downloaded software like PhotoShop or Apple hardware (30 to 40% premium in Australia on US list and the US based companies are also making a profit).
With such high markups, tax and value added tax, the foundries will go to where they are looked after. The level of automation, relatively few workers compared to the fab outlay and turnover in dollar terms means that labour costs are not the real issue. There are not many floor sweepers in a fab--causes too much dust, but plenty of really smart engineers to work around 30nm and lower. Yield is also critical. We dig for rocks here in Oz, US pushes paper on Wall Street, and UK (plus the bulk of Europe) seem to borrow from one election to another to keep voters comfortable.
Very fascinating. China is making so much progress in all areas. This is figuring out how play at all levels. This 13nm process is something I think not everyone should bother. There is a lot of gains in 90nm
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