The country will determine the development of integrated circuits

Not every country needs an integrated circuit industry. Many countries can get rich and safe even without this industry. However, China is by no means such a country.

As a large developing country with a population of 1.3 billion, as an ancient civilized country committed to the peaceful rise, as a socialist country that insists on independent and independent development, China must have a complete IC industry system. From the cultivation and development of strategic emerging industries to the modernization of national defense, from the integration of industrialization and informatization to the daily life of residents, integrated circuits play an irreplaceable role. It can be said that integrated circuits are the “salts” of modern society. It may be difficult for ordinary people to intuitively feel its existence. Without it, the whole society will not only lose the taste of life, but will also collapse due to fatigue. For China, without a strong integrated circuit industry, national security cannot be guaranteed, and the improvement of people’s livelihood and the harmony of society will be a matter of fact.

In the past 10 years, under the encouragement of the “State Council No. 18” of the State Council, China’s integrated circuit design, manufacturing, and packaging industries have made considerable progress, but in the face of the first-mover advantage accumulated in the United States, Japan, and South Korea, Chinese companies cannot prevail on all fronts. At present, China's integrated circuit manufacturing industry is lagging behind in terms of process and productivity. As far as the process is concerned, the 65-nm process of Chinese companies has just been mass-produced, which is two generations behind the advanced 32-nanometer/28-nanometer technology. The situation in the integrated circuit design industry is also not optimistic. In 2009, the world's largest integrated circuit design company had annual sales of 6.4 billion U.S. dollars, while the total output value of China's design industry last year was only 4.2 billion U.S. dollars. The IC equipment and materials industry as a supporting force has a greater gap with the advanced level in foreign countries, and it is still unable to meet the demand for high-end manufacturing. When the international financial crisis engulfed the world, the giants of the industry took advantage of the expansion. The Matthew Effect of “Greater Evergrande” has further manifested itself in the global IC industry. Therefore, China's integrated circuit industry will face more severe challenges in the future. Some experts believe that the next five years will be a critical period for China's integrated circuit industry to "live or die." This is by no means an alarmist.

To build a competitive integrated circuit manufacturing company requires huge capital investment. At present, the construction of an advanced 12-inch integrated circuit manufacturing plant requires investment of nearly 5 billion US dollars. According to industry estimates, Chinese companies will have to achieve the top two positions in the world's foundry industry within five years. The purchase cost of process equipment alone will exceed 12 billion U.S. dollars. As a "flag" of China's IC manufacturing industry, SMIC's annual sales revenue is only about US$1.5 billion under this year's dramatic increase in performance. It can be seen that the strength of the enterprise alone cannot compete with the international giants, and the will of the entire nation must be pooled. The government can help companies survive and develop in a brutal competitive environment through policy preferences, tax deductions, and even direct financial support.

The same is true for national security. Unlike "two bullets and one star," high-end integrated circuits must rely on the market and be supported by the industrial system. As Lu Xun pointed out: “People who have deleted branches and leaves have decided not to obtain results.” Building a complete IC industry system is like building a fleet. If an integrated circuit manufacturing company is an aircraft carrier, a submarine, or a battleship, equipment and materials companies are supply ships that provide logistics support for the fleet. Using manufacturing companies as a platform to achieve the localization of raw materials and some high-end equipment is also a task that we must complete in the next five years. For a fleet, it is more important than the ship to have sufficient fuel. The IC design industry is such a fuel because it is in direct contact with the end market. Only the prosperity of the design industry can provide the impetus for the IC industry to be sustainable. Therefore, the state's support for the integrated circuit industry can not only focus on manufacturing, design, equipment, materials, and even we have a certain foundation of the packaging and testing industry, all need to increase support.

For national support, IC practitioners must have a clear understanding. In the past half century, China's integrated circuit industry has gradually grown up with the support of the country.

Not every country needs an integrated circuit industry. Many countries can get rich and safe even without this industry. However, China is by no means such a country.

As a large developing country with a population of 1.3 billion, as an ancient civilized country committed to the peaceful rise, as a socialist country that insists on independent and independent development, China must have a complete IC industry system. From the cultivation and development of strategic emerging industries to the modernization of national defense, from the integration of industrialization and informatization to the daily life of residents, integrated circuits play an irreplaceable role. It can be said that integrated circuits are the “salts” of modern society. It may be difficult for ordinary people to intuitively feel its existence. Without it, the whole society will not only lose the taste of life, but will also collapse due to fatigue. For China, without a strong integrated circuit industry, national security cannot be guaranteed, and the improvement of people’s livelihood and the harmony of society will be a matter of fact.

In the past 10 years, under the encouragement of the “State Council No. 18” of the State Council, China’s integrated circuit design, manufacturing, and packaging industries have made considerable progress, but in the face of the first-mover advantage accumulated in the United States, Japan, and South Korea, Chinese companies cannot prevail on all fronts. At present, China's integrated circuit manufacturing industry is lagging behind in terms of process and productivity. As far as the process is concerned, the 65-nm process of Chinese companies has just been mass-produced, which is two generations behind the advanced 32-nanometer/28-nanometer technology. The situation in the integrated circuit design industry is also not optimistic. In 2009, the world's largest integrated circuit design company had annual sales of 6.4 billion U.S. dollars, while the total output value of China's design industry last year was only 4.2 billion U.S. dollars. The IC equipment and materials industry as a supporting force has a greater gap with the advanced level in foreign countries, and it is still unable to meet the demand for high-end manufacturing. When the international financial crisis engulfed the world, the giants of the industry took advantage of the expansion. The Matthew Effect of “Greater Evergrande” has further manifested itself in the global IC industry. Therefore, China's integrated circuit industry will face more severe challenges in the future. Some experts believe that the next five years will be a critical period for China's integrated circuit industry to "live or die." This is by no means an alarmist.

To build a competitive integrated circuit manufacturing company requires huge capital investment. At present, the construction of an advanced 12-inch integrated circuit manufacturing plant requires investment of nearly 5 billion US dollars. According to industry estimates, Chinese companies will have to achieve the top two positions in the world's foundry industry within five years. The purchase cost of process equipment alone will exceed 12 billion U.S. dollars. As a "flag" of China's IC manufacturing industry, SMIC's annual sales revenue is only about US$1.5 billion under this year's dramatic increase in performance. It can be seen that the strength of the enterprise alone cannot compete with the international giants, and the will of the entire nation must be pooled. The government can help companies survive and develop in a brutal competitive environment through policy preferences, tax deductions, and even direct financial support.

The same is true for national security. Unlike "two bullets and one star," high-end integrated circuits must rely on the market and be supported by the industrial system. As Lu Xun pointed out: “People who have deleted branches and leaves have decided not to obtain results.” Building a complete IC industry system is like building a fleet. If an integrated circuit manufacturing company is an aircraft carrier, a submarine, or a battleship, equipment and materials companies are supply ships that provide logistics support for the fleet. Using manufacturing companies as a platform to achieve the localization of raw materials and some high-end equipment is also a task that we must complete in the next five years. For a fleet, it is more important than the ship to have sufficient fuel. The IC design industry is such a fuel because it is in direct contact with the end market. Only the prosperity of the design industry can provide the impetus for the IC industry to be sustainable. Therefore, the state's support for the integrated circuit industry can not only focus on manufacturing, design, equipment, materials, and even we have a certain foundation of the packaging and testing industry, all need to increase support.

For national support, IC practitioners must have a clear understanding. In the past half century, China's integrated circuit industry has gradually grown up with the support of the country.

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