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Can China Buy Its Way Into Global IC Industry?

Why it makes sense for China to invest in OmniVision
9/4/2014 10:15 AM EDT
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junko.yoshida
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China's regional investment funds
junko.yoshida   9/4/2014 11:28:04 AM
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An eye-opener to me in working on this story was the fact that China's IC industry investment funds can go global. China's private equity investment fund could have a huge impact on yet-to-be-played-out M&A scenarios for chip companies outside China.

docdivakar
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Re: China's regional investment funds
docdivakar   9/4/2014 1:03:29 PM
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@Junko: It would seem that China will own the entire value chain / ecosystem for semiconductors in the years to come, with EDA being one of the exceptions!

I wonder if all of the 200,000 graduates in integrated circuits are working in jobs that matches their technical skills. What I have heard is that a good majority are not.

MP Divakar

Roba66
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Re: China's regional investment funds
Roba66   9/4/2014 1:32:02 PM
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I have worked in the IC industry for a long time. There used to be more IC layout and design work, but the industry in the west never established really efficient processes to get low volume IC's done with relaxed lithography (eg. .18 u). The EDA companies had reactive business models that forced them to cater only to large customers doing cutting edge designs.

So what I think and hope will happen with China getting involved is that we will see a new industry emerge where we can get IC's done cheaply in relaxed lithographies, packaging and layout at the same site perhaps. They will force the issue, this should be good for everyone.

 

junko.yoshida
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Re: China's regional investment funds
junko.yoshida   9/4/2014 1:39:08 PM
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Hi, MP.

You wrote: I wonder if all of the 200,000 graduates in integrated circuits are working in jobs that matches their technical skills. What I have heard is that a good majority are not.

I tend to agree with you assessment. However, the point here is the very fact that the semiconductor industry is pitched to sutdents in China as a promising industry (as more and more money flowing into the very industry.)

Now, that will make a huge difference, if not now, but in the next 10 years time.

As Nicky Lu told me, Don't judge China by looking at the country today. China seems to have all the elements getting ready now...

 

sprite0022
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Re: China's regional investment funds
sprite0022   9/4/2014 11:44:00 PM
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1 piece is still missing. the chinese still lacks a modern or realistic central philosophy which matchs the need of modern industralization.

when samsung build their fab in Xi'an they set up 6-8 church with them.

the chinese still don't understand the importance of spiritual guidance in building up a large scale human system. 

collin0
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Re: China's regional investment funds
collin0   9/5/2014 12:34:09 AM
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Now, China acquire not only Semidconductor companies in the world, mainly on American and European, but also purchase in other field.

Many Chinese people with much cash travel around world. They purchase nearly all the things without asking price on the way they visit. Many foreingers wonder how the Chinese could have  such amazing purchasing ability.

Because the China 's printing cash machines are working all year, even one second stop.

junko.yoshida
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Re: China's regional investment funds
junko.yoshida   9/5/2014 1:17:48 AM
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@collion0, I am neither overhyping the story nor underplaying it. I would not go so far as China is "buying the world." That said, if China's investment community can value semiconductor companies more favorably than its US counterpart, yes, China has the power to generate the new world order as far as the semiconductor industry is concerned.

 

docdivakar
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Re: China's regional investment funds
docdivakar   9/5/2014 12:00:35 PM
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@Junko: Regarding your comment: China has the power to generate the new world order as far as the semiconductor industry is concerned...

I agree that it is only China as of now that can disrupt the existing hegemony of high tech industry of which semiconductor is a prominent one. I do recognize another comment below that says don't make opinions on this topic based on what is China today, a fair one. Unless there are major economic policy shifts toward protectionism in Western economies, it will be most likely China that will own the end-to-end semiconductor industry.

How ever, what discomforts me the most is the lack of opportunities for foreigners to work in China-owned industries in China, in stark contrast to western economies which are more open and welcome talent from any where. If current policies of China are any indication, opportunities will only be accessible to locals. I don't think it is healthy for the industry!

MP Divakar

junko.yoshida
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Re: China's regional investment funds
junko.yoshida   9/5/2014 1:47:48 PM
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@MP, you wrote:

If current policies of China are any indication, opportunities will only be accessible to locals. I don't think it is healthy for the industry!


True. Definitely, these opportunities are for locals and not for foreigners....although we might be working for Chinese-owned companies at one point. And that's precisely why each nation, wihtout necessarily subsribing to protectionism, needs to develop its own industrial policy. 

DrFPGA
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Re: China's regional investment funds
DrFPGA   9/8/2014 10:23:01 AM
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Just in time for integration to get more difficult. The ic industry offers no free ride from here on. Maybe this makes it more attractive as a cash cow if you can grab a large enough chunk of it. Hard to tell....

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