Monday, October 23, 2017
A nanosecond is a long time in the semiconductor sector while three years is an eternity.
Back in 2013, Chinese smartphone chipmakers had a mountain to climb against global rivals such as Qualcomm in the United States.
They barely even had a presence in the low-end segment of the market.
But all that changed after the government rolled out new policies and domestic players broke through technological barriers.
"Three years ago, we relied chiefly on a price war to crack the market," said chief executive officer Li Liyou of Spreadtrum Communications, one of the largest chipmakers on the Chinese mainland. "But as more resources were poured into research and development, we saw a fundamental change."
Plans to upgrade the homegrown chip industry are in line with the central leadership's call to turn China into a manufacturer of quality.
"We will move Chinese industries up to the medium-high end of the global value chain, and foster a number of world-class advanced manufacturing clusters," Party General Secretary Xi Jinping said at the opening of the 19th National Congress of the Communist Party of China in Beijing on Wednesday (Oct 18).
Data from research agency IC Insights revealed that 11 Chinese companies were on the global top 50 list for integrated circuit designers in 2016. In 2009, only one domestic business was on the list.
Spreadtrum Communications is a classic example of what is happening inside the industry. It produced more than 600 million smartphone chips last year, accounting for over 25 per cent of the world's total shipments.
Huawei Technologies, the world's third largest smartphone manufacturer, is also making inroads with its in-house Kirin chips.