Domestic chips is coming and China is replacing Japan as the high tech exporter in Asia
China Breakthroughs: Charging ahead on "Made-in-China" chip technology
Editor: Qian Ding 丨CCTV.com
10-25-2017 20:17 BJT
By Tom McGregor, CNTV Commentator
The smartphone is an amazing device and along with its notable advances in 4G networks, since users can tap into the internet, watch a film, or instant message friends while even walking in a crowded street.
Such technology has transformed everyone's lives and the Chinese government is helping homegrown hi-tech firms to develop further upgrades on hardware and software for smartphones, as well as creating "Made-in-China" chips along with related technologies.
Speadtrum Communications Inc., a chip-maker for state-owned phones, plans to invest over 300mn. RMB ($US46.4mn.) from 2015 to 2020.
"Chip-making is critical technology for many areas, including smartphones," China.org quotes Ye Tianchun, director of the Institute of Microelectronics, as saying. "China is set to grow a strong chip sector, so we don’t have to beg other countries for key chip-sets."
Domestic hi-tech exports gain momentum
China has long been recognized as a low-tech manufacturing market, while Japan has captured global acclaim producing hi-tech consumer gadgets.
Yet, the tables have turned in recent years, which means Chinese smartphones manufacturers - Huawei, Xiaomi, ZTE, Meizu and Oppo - have become widely-popular for consumers worldwide.
And for more proof that Chinese hi-tech companies are overcoming Japanese firms in international rankings and status, the 2015 Asian Economic Integration report published by the Asian Development Bank disclosed that China had surpassed Japan to emerge as the number one hi-tech Asian exporter in 2014.
China's share of Asian exports had risen to 43.7 percent in 2014, compared to 9.4 percent in 2000. Japan's share had plunged to 7.7 percent, from 25.5 percent in 2000.
China's exports of low-tech goods had accounted for 28 percent of its export market in 2014, compared to 41 percent in 2000.
Moving forward to 2016 the figures are even better. According to statistics compiled by the World Bank, China is the leading exporter of hi-tech devices, totaling over US$560bn for 2016. In comparison, Japan exported hi-tech goods valued at US$105bn for the same year.
Nonetheless, many Chinese companies are not satisfied with prior success and they hope to enjoy even greater success in the long-term future.
Chinese smartphone manufacturers are looking ahead to adapt better software and hardware to be built into their smartphone devices, as well as to provide deeper support for domestic companies to develop new chips, so they can stand at the forefront to challenge their bigger global rivals, such as Qualcomm and Intel.
Huawei makes bold chip move
Shenzhen-based Huawei Technologies, a telecom equipment maker and China's largest smartphone vendor by shipments, has demonstrated support for "Made-in-China" chips by introducing a homemade processor, Kirin 950, installed in it's flagship device, Mate 8 that was introduced to the market in 2015.
HiSilicon Technologies Co. Ltd., a chipmaking subsidiary of Huawei, produces the Kirin 950 that boasts of faster processing speed and a power efficient design.
The Kirin series has already enjoyed remarkable success and had integrated into Mate 9 and 10 series from 2016 to 2017.
(Huawei’s Mate 10 smart phones, newly launched on Oct. 20, 2017 Photo from Xinhua)
HiSilicon Techonologies remains optimistic and has emerged as one of the leading contenders in the global mobile chip market, which include - US-based Qualcomm Inc. and Taipei-based MediaTek.
The new chip has already grabbed the hearts of Chinese consumers. Huawei had witnessed 81 percent year-on-year growth of sales in China in 2015, according to Canalys research firm.
Mobile e-commerce to benefit
Creating new chip technology offers numerous advantages. For example, cyber-attacks have become a rising concern for mobile online consumers since users place confidential personal information at risk when transferring data to legitimate online vendors.
Chinese technology firms are developing more enhanced chips to combat cyber-crimes, while increasing processing speeds. Huawei is a major player in the field. Such advances can add stronger momentum to the nation's mobile e-commerce market.
The research firm, Forrester's, reports that, China had surged to the world's biggest online economy in 2013. In that year alone, 25 percent of Chinese residents had shopped from smartphones weekly, and 69 percent of Chinese purchased at least one item from a mobile device.
The figures had surged to even greater heights from 2014 to 2016. And rising revenues from Chinese e-Commerce sales are expected to continue on for 2017 and the years ahead..
"Made-in-China" chips for the masses
Accordingly, with strong government support, Chinese hi-tech companies have added incentive to build more R&D (research and development) centers to develop innovations in the domestic chip industry.
Some hi-tech firms can boost their profit margins by developing new chip technologies that can be adapted to mobile devices.
By deepening endeavors to upgrade hardware chips or create new ones, this would not guarantee big money success overnight.
Nevertheless, chip technology companies should remain persistent, to work hard, take risks and conduct experiments so that they can enjoy a payoff in the long run.
(The opinions expressed here do not necessarily reflect the opinions of Panview or CCTV.com. )
Just an aside --Tom McGregor is also an active answerer on Quora for China related topics.