A story about China's development of independent chips丨Fence in the dark forest
Latest update time：2021-09-01 20:33
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Hu Weiwu, chief designer of Loongson, once said in an interview in 2015, "What the government should do is to build a fence in the dark forest, build a small forest, and block foreign chips. At the same time, the companies within the fence compete with each other without intervention, so that these companies can survive the fittest, and finally the winners will walk out of the forest and compete with foreign chips." This statement triggered discussions in the political, industrial, academic, and research circles of China's integrated circuits at the time. Five years have passed, and after the continuous escalation of friction and confrontation between China and the United States in 2018, 2019, and 2020, I believe that different readers have their own opinions on whether the "fence theory" is correct or not.
The author does not intend to discuss the "fence theory" itself, but in the process of reviewing the development history of China's integrated circuit industry, he found that my country had intentionally or unintentionally implemented a "fence policy" for a period of time. In the first 10 years of this century, mastering the discourse power of various standards/protocols has always been one of the main goals pursued by the domestic electronic information industry. These domestic standards/protocols have in fact led and promoted the development of domestic electronic equipment and chips. In other words, these domestic standards/protocols have played the role of "fence" to a certain extent.
Although this period of history is very short, the media rarely mentions this period of development of the domestic integrated circuit industry, so that the new generation of practitioners feel particularly unfamiliar with this period of history. Therefore, the author plans to write a series of articles to explore this period of history that is closest to us but unfamiliar to many people. I hope that by looking back on this difficult and tortuous exploration process, it can provide some reference for the next development of my country's integrated circuit industry.
The main sources of information for this series are various Internet news, interviews and other public information on the Internet. Since they are not first-hand information, there may be some discrepancies with the facts. If there are any errors or omissions, please forgive us. Readers who know more details are also welcome to "expose" in the comments.
Issue 1: The Great Wall is a long one - the history of TD-SCDMA terminal chips
When it comes to domestic standards/protocols, TD-SCDMA is definitely a topic that cannot be avoided. It is through TD-SCDMA that my country has completed the technical accumulation and talent team building in mobile communication technology, learned the rules of the industry game, and knew how to lay out the entire industry chain, which opened a new era. However, the development process of TD-SCDMA has also been controversial. It has experienced many dark moments and twists and turns during the period, and it is still difficult to make a final conclusion. And the many domestic terminal chip companies that have developed with the domestic standard TD-SCDMA have also had a tragic fate, which is regrettable. However, as the most influential domestic standard, TD-SCDMA has indeed driven the development of a number of domestic chip companies and cultivated seedlings for China's integrated circuit design industry.
1. Breakthrough - Proposing the TD-SCDMA standard
For the communications industry, in order to achieve interoperability between different devices, unified standards must be used. Therefore, communications technology standards are the most critical commanding heights in the entire communications industry. In other words, communications technology standards regulate the design standards of communications equipment and its internal key chips and circuits. Whoever gains the right to speak in the formulation of communications standards will guide the development direction of the entire communications industry. If you "ambush" your already obtained patents or mastered technologies in advance in the communications standards, you can gain huge benefits in the development of the industry with these patents and technologies. Qualcomm is a typical example of rapid expansion relying on communications standards. Therefore, seizing the right to speak in communications standards is of great value to the country, operators, equipment manufacturers, core chip manufacturers, and supporting component manufacturers.
3G protocol is the abbreviation of the third generation mobile communication protocol. The 2G protocol before 3G protocol was widely used in the world, which was GSM dominated by Europe. In 1992, when GSM was just put into use, the European Commission began to deploy 3G research. In 1996, Europe established the Universal Mobile Telecommunications System (UMTS) Forum to focus on coordinating the standard research of European 3G. In 1997, the International Telecommunication Union began to collect 3G technical standards. The Ministry of Information Industry at that time held an expert seminar in Xiangshan, northwest of Beijing, to discuss and decide whether to submit China's technical solutions to the ITU.
At that time, most people were against it, thinking that it was a trick played by Westerners, and that China had no technical accumulation at all, let alone becoming a global standard, and even the opening of the hundreds of pages of English text was unknown. But in the long run, it is indeed necessary to increase the right to speak, otherwise the future situation will become very passive.
Finally, the leader of the Ministry of Information Industry made the final decision: "China cannot always rely on foreign technology to develop its mobile communications industry. There must be a first time. The first time may not be successful, but it will leave behind valuable experience. I support them in bringing TD-SCDMA to the international stage. If it does fail, we will also regard it as a victory, an attempt by the Chinese people to dare to innovate and a contribution to the country." At that time, the Ministry of Information Industry believed that if they could succeed, it would be the best. If not, at least they would have accumulated some experience in dealing with international rivals and could even get foreign countries to reduce their patent fees.
This project was supported by Zhou Huan, then Director of the Science and Technology Department of the Ministry of Posts and Telecommunications, and Li Shihe, Vice President of the Institute of Telecommunications Science and Technology (later transferred to Datang Telecom Technology Co., Ltd.). Zhou Huan asked Li Shihe to lead the development of the standard within three months and come up with a technical framework based on SCDMA. Li Shihe studied for a doctorate in the United States and worked in the research institute of the Ministry of Posts and Telecommunications after returning to China. He also specially introduced two Chinese scientists who specialized in smart antennas.
In June 1994, after in-depth technical communication, the three believed that SCDMA was a technology with great potential in wireless transmission. In 1995, they introduced SCDMA technology to the Ministry of Posts and Telecommunications and led experts from the Ministry of Posts and Telecommunications to the United States for inspection and demonstration. They were highly recognized by the relevant leaders of the Ministry of Posts and Telecommunications and decided to introduce the relevant technology into China. In November 1995, the Institute of Telecommunications Science and Technology and Cwill Company jointly established Xinwei Company, with Li Shihe as chairman and Chen Wei as general manager. Immediately afterwards, SCDMA was included in the "Ninth Five-Year Plan" science and technology research plan and received 15 million yuan in funding, and also received 10 million yuan in funding from the State Planning Commission.
The SCDMA technology favored by Li Shihe and Zhou Huan later became the prototype of TD-SCDMA. However, the initial application of SCDMA technology was more inclined to local fixed access. In simple terms, it is to complete the last mile access through wireless technology, so as to solve the problem of telephone access in rural areas, remote mountainous areas and other areas where wiring costs are too high at a low cost. However, the most important feature of mobile communications, "mobility", is not obvious in SCDMA.
At this time, an unexpected opportunity brought new progress. In order to maintain its leading position in the 3G era, Europe decided to jointly support a standard. Siemens focused on TDD research in the early stage of 3G research, but lost to the WCDMA camp represented by Ericsson and Nokia in the initial technical screening in Europe. And as a European company, Siemens also had to co-brand and invest in supporting the European camp's UMTS, which meant that the previous TDD investment was basically wasted.
Later, under the recommendation of Li Wanlin, who participated in 3G R&D at Siemens Research, Siemens decided to cooperate with the Chinese using this technology and combine it with SCDMA technology, so that the Chinese would come up with a new 3G standard. Siemens' move was not because they were "old friends of the Chinese people", but because they wanted to avoid wasting their years of research investment.
After integrating the accumulation of TDD-CDMA and SCDMA, China's 3G standard has already possessed the three core technical features of time division duplex, synchronous code division multiple access and smart antenna.
In June 1998, before the deadline, Datang Telecom submitted the TD-SCDMA communication standard to the Telecommunications Union, and Li Shihe began a difficult journey. At that time, Europe and the United States were evenly matched in terms of 3G standards, and neither side gave in. This was not only about the face of Europe and the United States, but also about many conflicts of interest. However, several proposals from the United States, Europe, Japan, and South Korea were eliminated, and the young TD-SCDMA was also rejected.
But at the last moment, due to the need for confrontation between Europe and the United States and their contempt for China, when the CDMA2000 and WCDMA standards led by the United States were in dispute, both sides hoped to gain China's support. At this time, Europe and the United States believed that even if China's standards passed, China's accumulation of communication technology was not enough to promote the application of TD-SCDMA in the industry.
With the strong support of the Ministry of Information Industry, China Mobile, China Unicom and other operators, and through the long-term game between Europe, the United States and China, the ITU (International Telecommunication Union) officially announced that TD-SCDMA submitted by China would be listed as one of the three major 3G international standards along with WCDMA dominated by Europe and CDMA2000 dominated by the United States. Li Shihe is therefore known as the "Father of TD-SCDMA".
There are many stories behind the development and approval of the TD-SCDMA standard, but since it is not the core content of today's article, I will not elaborate on it in detail. Many review articles and even some technology videos have detailed introductions to this.
2. The ups and downs of TD-SCDMA's landing process
Although the standard was passed, the standard without industrialization was just a paper achievement and would not produce any social benefits. The reason why Europe and the United States let China off the hook was that they believed that China did not have the ability to industrialize the standard. However, China's communications market with more than one billion people has shown great potential. Giving China a face is a gesture of friendship. If TD-SCDMA fails to develop in the future, "friendly" foreign manufacturers will still come to do business and occupy the market.
At first, the China Telecommunication Research Institute thought that it would take no more than three years for TD-SCDMA to be industrialized, but the actual time was much longer than three years. In March 2002, Datang Mobile Communications Equipment Co., Ltd. was established, marking the beginning of the full industrialization of China's TD-SCDMA technology. However, once this curtain was opened, what awaited the Chinese communications industry and related industries was not a bright road paved with flowers, but a difficult road full of thorns.
The difficulty of the communications industry lies in the fact that standards, patents, technologies, equipment, terminals, core chips and components are bound and constrained by each other. If any one of the entire industry chain is not mature enough, it will drag down other links and lead to insufficient willingness of companies in other links to cooperate. This will eventually lead to the overall decline of the industry chain and the huge investment in the early stage will be wasted.
Both CDMA20000 and WCDMA were standards proposed based on sufficient technical accumulation in the 2G communication era, while TD-SCDMA has a lot of details but lacks the final technical accumulation. Therefore, foreign manufacturers reacted coldly to the release of TD-SCDMA, and some equipment manufacturers even said, "We have the ability to do TD-SCDMA, but we won't do it." Global operators are obviously not interested in TD-SCDMA. From a business perspective, foreign operators would not rashly adopt a standard that has not been fully verified, not to mention that this standard came from China, where the communication technology level was not advanced at the time.
While TD-SCDMA was not well received abroad, it was also questioned domestically. Many well-known economists and communication technology experts were strongly opposed to the launch of TD because it was not economically viable and the prospects for technical and industrial promotion were unclear. Amid the disputes and entanglements among various parties, the road to TD-SCDMA industrialization was difficult.
The other side of danger is opportunity. If we start with technical standards, then develop products, and then promote the industry to form patents, and then let the patents radiate the entire industry, it will improve the level of the entire industry. Although this road has great resistance, if it can be carried out, the benefits will undoubtedly be huge.
In 2005, Zhou Huan, then chairman of Datang Group, found the then president of the Chinese Academy of Sciences, the president of the Chinese Academy of Engineering, the chairman of the China Association for Science and Technology and other heavyweight scientists and asked them to jointly write to the relevant government departments to support China's "independent innovation" TD-SCDMA. In the atmosphere of advocating independent innovation at the time, the leaders of the three major scientific research institutions in China jointly wrote a letter, which attracted the attention of the decision-makers.
The top leaders commented: This is a serious matter, and it concerns the development direction of my country's mobile communications. This was interpreted as China's "national effort" to develop TD-SCDMA.
The reform of China's telecommunications system from 2000 to 2009 led to the merger and separation of Chinese operators, resulting in the emergence of Netcom, Tietong, Jitong and other operators that have been forgotten today. At that time, there was a proposal to let small operators such as Tietong operate TD-SCDMA, but fortunately this proposal was not adopted. Because letting a weak operator operate TD-SCDMA, a communication standard that is not mature in all aspects, basically announced the abandonment of TD-SCDMA.
After a long period of hesitation, as China's telecom operator reform was finally finalized, 3G licenses were finally issued. Among the "three major operators" that were finally formed, China Telecom obtained the CDMA2000 license, China Unicom obtained the WCDMA license, and the most powerful China Mobile obtained the TD-SCDMA license.
Using the strongest operator to promote the immature domestic standards shows the country's determination to support independent technology; while the other two major operators adopt relatively mature foreign standards, which is a manifestation of a firm open route and market orientation. Maintaining a difficult balance between independent innovation and open cooperation is precisely the difficult problem that our country has been unable to avoid in major decisions during the 40 years of reform and opening up.
Objectively speaking, TD-SCDMA is inferior to WCDMA and CDMA2000 in terms of R&D time, technical maturity and industrial chain support. Many of the technologies envisioned in TD-SCDMA are not practical in actual industrial applications. The most famous example is that the proud smart antenna technology was complained by engineers as "heavy as a door panel" in actual use. As its core standard, TDD technology, in actual implementation, has higher requirements for channel synchronization due to uplink and downlink channel switching, which also greatly increases the difficulty of designing transceiver circuits.
Even in the 4G TD-LTE era, this problem still troubled designers when I participated in the research and development of micro base station systems. The coordination between baseband chips and RF modules is much more complicated than FD-LTE, and even additional devices are required to achieve performance standards. The limitations imposed by these problems on equipment performance have indeed brought too many difficulties to operations.
However, under the strong promotion of China Mobile, TD-SCDMA was still widely used. China Mobile spent nearly 200 billion yuan on TD-SCDMA, and invested a total of 500,000 sites. In addition, it subsidized tens of billions of yuan on terminals to promote it. If China Mobile did not use TD-SCDMA at that time, but used the WCDMA standard, it would only cost about 100 billion yuan, and many people questioned whether the 200 billion yuan was worth it.
However, according to statistics, TD-SCDMA operations, terminals, chips, system equipment and other industries directly boosted GDP by 61.2 billion yuan, indirectly boosted GDP of other industries in the national economy by 176.8 billion yuan, and created more than 400,000 jobs. It has indeed driven the development of related industries in China and the improvement of technological levels to a great extent.
While promoting 3G, my country has been stepping up the research and development of 4G related technologies. The technology and experience accumulated in TD-SCDMA played a major role in the formulation of 4G standards. In 2007, Ericsson, which led the LTE standard, extended an olive branch to China and agreed to support the TD 4G solution as the only solution for LTE TDD. As a result, TD-LTE, led by China, became one of the two major standards in the 4G era.
When the 5G era came, China's voice in communication standards and technological level had already required the United States to intervene and suppress it. All this happened just over five years after China Mobile obtained a 4G license in December 2013 and began to build 4G in an all-round way to get rid of the influence of TD-SCDMA. Many "experts" claimed that China's 3G construction was "misguided", "wasting resources" and "cutting itself off from advanced technology".
3. The rise and fall of TD-SCDMA terminal chip companies
To achieve good mobile communications, terminals (mainly mobile phones, but also data cards, portable WiFi and other similar terminals) are indispensable. Terminals, in turn, rely on key components such as core chips and power amplifiers used in terminals. If the core chip of a terminal does not support the communication standard, then the terminal will not be able to "access the network". Conversely, if there are few core chips that support a certain communication standard, there will be fewer terminals that support this communication standard, forcing some consumers to "switch networks" for certain models of terminals.
A typical example is that Apple phones did not support the TD-SCDMA protocol for a long time, making Apple phones almost "China Unicom exclusive phones" for a period of time. Consumers switched to China Unicom in large numbers in pursuit of fashionable Apple phones, which also caused a lot of headaches for China Mobile, which was operating TD-SCDMA at the time.
Unlike wireless network terminal equipment that can be "built" with high-end general-purpose processors such as FPGA and DSP processor arrays, mobile terminals must rely on highly integrated system-level core chips due to the size and power consumption of mobile terminals. With the advent of the 3G era, due to the existence of multiple communication standards, to ensure that the terminal can "roam" in different networks, the core chips and peripheral components need to support multiple standards. This is the origin of the so-called "3-mode machine" and "5-mode machine". However, the frequency bands actually allocated by various countries for the same standard are different. It is not easy to design a highly integrated system-level chip that supports multiple standards and multiple frequency bands. If you need to support one more standard, the difficulty of chip design increases exponentially. This is actually why foreign manufacturers are not very interested in supporting TD-SCDMA. It is obviously not in the interests of foreign manufacturers to increase the difficulty of their own chip design and delay the time to market for a standard that has been delayed in commercialization and has an unclear future.
Since foreign manufacturers have little interest in TD-SCDMA, China's full-scale promotion of TD-SCDMA actually gives domestic terminal chip manufacturers an opportunity. Compared with these foreign companies that have accumulated technology for many years, domestic terminal chip companies that started from scratch have no burden, but on the other hand, they have no choice. Compared with competing head-on on the turf of foreign manufacturers, the uncultivated virgin land of TD-SCDMA obviously contains more hope.
In the early stage, the companies that developed TD-SCDMA terminal chips mainly included domestic companies such as Spreadtrum, Kaiming, Chongqing University of Posts and Telecommunications, Unigroup, and Tianji, as well as MediaTek from Taiwan. Later, with the official commercialization of TD-SCDMA, companies such as Qualcomm and Marvell also began to produce terminal chips supporting TD-SCDMA.
The first to conduct research on TD-SCDMA terminal chips was Chongqing University of Posts and Telecommunications, which was born out of Chongqing University of Posts and Telecommunications (now Chongqing University of Posts and Telecommunications). In the early years, Chongqing University of Posts and Telecommunications participated in the research and development of TD-SCDMA standards together with Datang, and trained a group of TD-SCDMA development talents.
In April 1998, Li Shihe's standard writing team was about to submit the standard to the International Telecommunication Union, but he was not familiar with the core network part. Li Shihe knew Nie Neng, president of Chongqing University of Posts and Telecommunications. As a former post and telecommunications institution, Chongqing University of Posts and Telecommunications was the birthplace of digital communications in China and gathered a group of communications experts. So Li Shihe found Nie Neng, hoping that Chongqing University of Posts and Telecommunications could cooperate with him to propose this standard and do some research on the core network.
At the end of 1998, Chongqing University of Posts and Telecommunications formally submitted two papers to the International Telecommunication Union, one of which was adopted in terms of network. Li Shihe was working on the standard for the air interface at the time, so he said, "Why not, let's work together?" Nie Neng said, "I support your decision." Nie found Zheng Jianhong, then director of the Instrumentation Institute of Chongqing University of Posts and Telecommunications, and asked him to form a 3G research team and go to Beijing to work with Li Shihe on research and development.
At that time, the base station equipment was jointly developed by Datang Telecom and Siemens, and the terminal was jointly developed by Datang Telecom and Chongqing University of Posts and Telecommunications. In the terminal R&D department, of the initial 68 people, 43 were from Chongqing University of Posts and Telecommunications, and the total number eventually increased to more than 80. In May 2000, the TD-SCDMA standard was officially determined by the International Telecommunication Union as one of the world's 3G standards. In February 2001, the terminal experimental prototype jointly developed by Datang and Chongqing University of Posts and Telecommunications achieved physical layer calls.
At this time, although the TD-SCDMA standard was approved and some related equipment research had made breakthroughs, it was still a long way from real commercialization. Under this situation, the commercialization process of the other two 3G standards was very fast, so the situation facing the TD-SCDMA standard was very urgent. Datang Telecom also needed to speed up the commercialization of the TD-SCDMA standard and shorten the time for equipment research and development.
Therefore, after Datang and Chongqing University of Posts and Telecommunications reached an agreement on the sharing of intellectual property rights obtained through their cooperation, the Chongqing University of Posts and Telecommunications TD-SCDMA research team returned to Chongqing in October 2001 and started to independently develop TD-SCDMA terminals.
With strong perseverance in hard work and the indomitable spirit of being willing to endure loneliness, the TD-SCDMA R&D team completed the real-time image transmission of 16-channel MPEG-4 involving only the TD-SCDMA physical layer at the end of 2001 with an experimental prototype; in May 2002, a call was dialed through using the experimental prototype and a self-made analog base station; in June 2003, the TD-SCDMA (TSM) terminal independently developed by Chongqing University of Posts and Telecommunications made a call on the Chongqing TD-SCDMA field test network; in October 2003, the independently developed TD-SCDMA (TSM) mobile phone made various calls through Siemens and Datang base stations at the Beijing International Communications Exhibition, marking the successful development of the world's first TD-SCDMA (TSM) mobile phone prototype with completely independent intellectual property rights in my country.
This move is a major breakthrough in China's century-long telecommunications history, marking that China has entered the ranks of the world's advanced mobile communication technology, and completely ending the history of my country's TD-SCDMA third-generation mobile communication system with only systems but no terminals.
In November 2004, Chongqing Post and Information Technology Co., Ltd. officially started the design of 0.13 micron TD-SCDMA mobile phone core chip, and established the industry chain from front-end to back-end design, tape-out to packaging. In October 2005, Chongqing Post and Information Technology Co., Ltd. independently developed the TD-SCDMA mobile phone core chip and commercial mobile phone. For a time, Chongqing Post and Information Technology Co., Ltd. became an important force in the construction of terminal chips and even communication networks in China. Since 2008, Chongqing Post and Information Technology Co., Ltd. has been preparing for industrialization while supporting system manufacturers to build networks. In May 2008, Chongqing Post and Information Technology Co., Ltd.'s TD-HSDPA wireless network card, TCN230, was the first to pass the test organized by the Ministry of Industry and Information Technology and obtained the network access certificate, and successfully supplied China Mobile in batches to serve the Beijing Olympic Games.
However, the glory of Chongqing University of Posts and Telecommunications faded away with the end of the 3G era. When China Mobile obtained the 4G license and began to rapidly develop TD-LTE, Chongqing University of Posts and Telecommunications' terminal chip research and development could no longer keep up with the times. The last important news about Chongqing University of Posts and Telecommunications and TD-SCDMA was the rumor in 2011 that HiSilicon intended to acquire Chongqing University of Posts and Telecommunications in order to obtain relevant patents in the development of TD-LTE. However, Chongqing University of Posts and Telecommunications later denied the rumor.
Today, on the official website of Chongqing University of Posts and Telecommunications, the latest product achievements are the Haier HT-i928 and Furi FS-936 phones equipped with Chongqing University of Posts and Telecommunications smartphone chips in 2013. Its main business is described as consulting and survey and design of information and communication network engineering, engineering construction, engineering supervision, network and communication equipment maintenance and optimization, informatization and system integration, engineering bidding agency, information and communication technology innovation and application development, etc. In the information and communication technology innovation and application development, which ranks last, Chongqing University of Posts and Telecommunications briefly records this short but shining history in TD-SCDMA terminal and chip research.
Kaiming Information (Kaiming) is a "tragic hero" in the history of TD-SCDMA development. On April 24, 2008, when Kaiming CEO Yu Yushu confirmed that the company did not have follow-up funds and the capital chain was broken, it caused a great shock. At this time, it was the eve of large-scale commercial use of 3G in China, which once again triggered a great discussion on whether China should develop TD-SCDMA and how to develop it. At that time, Sina.com even made a special report on Kaiming's bankruptcy, and this special report can still be found through search engines.
Kaiming was founded in February 2002 and is one of the earliest companies to enter the research and development of TD-SCDMA terminal chips. It was first jointly funded by 17 companies including China Putian, Datang Telecom, Nokia, Texas Instruments, and LG Electronics. Among the 17 members, 9 are domestic companies and 8 are foreign companies. Foreign capital accounts for 68.76% and Chinese companies account for 31.24%. Putian, Texas Instruments, Nokia, etc. each account for 13.5% of the total share capital, and the total share capital is RMB 233.35 million. This is a very "peculiar" company. Perhaps foreign companies are still unwilling to completely give up the possible opportunities of TD-SCDMA and set up such a joint venture.
In 2004, the TD-SCDMA chip developed by Kaiming was successfully taped out in one go using the 0.18-micron process of Semiconductor Manufacturing International Corporation (Shanghai) Co., Ltd. (SMIC). Kaiming completed the front-end system and circuit design and verification, and VeriSilicon Microelectronics (VeriSilicon) provided SMIC with 0.18-micron cell library and back-end design services. This was a very successful example of cooperation between design companies, design service companies and foundries at the time, and set a benchmark for China's chip design and foundry, which was still in its infancy.
Dr. Richard Chang, then Chairman, President and CEO of SMIC, said: "The localization of the production and packaging of our independently designed communication chips is of great significance in shortening the time to market for complete products. China is a vast and growing market. The 3G era is coming, and we hope to provide chip manufacturing services in this market."
At the 2004 Beijing International Communications Exhibition and TD-SCDMA Industry Summit, Kaiming announced its complete TD-SCDMA terminal chipset solution with independent intellectual property rights, and demonstrated a terminal prototype designed by its customers based on Kaiming technology and conducted a call demonstration. In 2005, Kaiming announced that its four TD-SCDMA terminals based on Kaiming solutions had passed the test. Its R&D progress was in a leading position at the time. However, TD-SCDMA has not been commercialized for a long time, and Kaiming's capital chain began to tighten during the constant waiting.
In the second half of 2007, Kaiming's cash flow began to be tight. In order to maintain the normal operation of the company, the two major shareholders, Hyper Market International Ltd and Texas Instruments, decided to jointly inject US$7 million into Kaiming. However, the funds were not used to increase the company's capital, but were lent to Kaiming in the name of "loans". They promised to deposit the funds into Kaiming twice at the end of 2007 and February 2008, with each payment of US$3.5 million. However, in February 2008, the second batch of loans of US$3.5 million from the two shareholders did not arrive on time.
Perhaps the shareholder structure of more than a dozen companies in Kaiming was destined to the final outcome from the beginning of registration. After all, if the company is not profitable, the funds will eventually run out. Even if some shareholders want to inject capital to save the company, other shareholders do not agree to expand the capital and the funds cannot be introduced. From the attitude of many shareholders of Kaiming towards value-added, we can also see the attitude of shareholders such as TI and Nokia towards TD-SCDMA. After all, even if TD-SCDMA becomes an international 3G standard, it is mainly promoted in China. When TD-SCDMA has been unable to be commercialized on a large scale, it is probably neither realistic nor reasonable to ask these foreign companies to "grit their teeth and hold on".
No matter what, Kaiming still collapsed, before dawn. Its collapse was used by a group of experts and analysts as an argument that "TD is not good". In China Mobile's first batch of TD mobile phone bidding, mobile phones based on Spreadtrum and T3G chips occupied a large market share, while Bird mobile phones using Kaiming chips were not shortlisted, but Bird's name appeared in the second batch of mobile phone network access list. If they had really gritted their teeth and persevered at that time, it is actually hard to say whether they could have survived. After all, TI, a former shareholder of Kaiming, was soon squeezed out of the terminal chip market and fully transformed into an analog chip company. Nokia, once the king of mobile phones, also completely lost its mobile phone business in the subsequent competition. The competition in technology has always been so ruthless and cruel.
Tianji Technology was jointly founded by NXP Semiconductors, Datang Mobile and Samsung Electronics in January 2003. Compared with Chongqing University of Posts and Telecommunications and Kaiming, Tianji Technology's story is more monotonous. In 2004, Tianji Technology's first generation of TD-SCDMA terminal chips came out. In 2008, Tianji's customer's terminal passed the terminal certification test of RITT and successfully won the bid for China Mobile's first round of TD terminal centralized procurement. Many TD terminals developed using Tianji platform have obtained network access licenses issued by the Ministry of Industry and Information Technology.
However, due to the fact that TD was not put into large-scale commercial use in the early stage and the huge investment did not see returns, the original shareholders intended to withdraw from TD. In February 2009, T3G Technology became a wholly-owned subsidiary of ST-Ericsson. The latter integrated STMicroelectronics' wireless semiconductor business (ST-NXP Wireless) and Ericsson's mobile platform department (Ericsson Mobile Platforms) into a joint venture, with each party holding 50% of the shares. With the recovery of the TD market in the second half of 2009, T3G's sales also ushered in a rising period.
The end of Tianji Technology is full of black humor. ST-Ericsson was founded in 2009, with parent companies Sweden's Ericsson and France's STMicroelectronics each holding 50% of the shares. It was committed to the research and development of mobile phone chips. Due to the rise of smartphones in 2010, ST-Ericsson was strongly impacted by chip manufacturers such as Qualcomm in the United States and Samsung in South Korea in the market. The company's business deteriorated and finally ceased operations in 2013. With the cessation of ST-Ericsson's operations, Tianji Technology completely disappeared in the long river of history.
Unicore Technology is the "child" of Datang Telecom, the initiator of TD-SCDMA. In order to develop TD-SCDMA, Datang established Unicore Technology in 2008. Although it was established relatively late, thanks to Datang's previous accumulation in the TD-SCDMA field, Unicore's revenue increased from less than 100 million yuan at the beginning to 800 million yuan in annual sales in the three years from its establishment in 2008 to 2010, a year-on-year increase of 12 times, and its net profit increased by 50 times year-on-year. However, after 2010, TD-SCDMA was gradually neglected, and Unicore Technology also launched a series of "self-rescue" measures.
At the end of November 2014
, Xiaomi and Leadcore Technology cooperated and jointly established a new company, Beijing Songguo Electronics Co., Ltd., which is responsible for the research and development and application of core mobile phone chip technologies. Xiaomi will hold 51% of the shares and Leadcore Technology will hold 49%. Leadcore Technology licensed its SDR1860 platform technology to Beijing Songguo for RMB 103 million. For Leadcore, with the help of Xiaomi, it can take the backward Leadcore to a higher development platform, which is beneficial for both the improvement of its brand awareness and the expansion of market scale. For Xiaomi, it can quickly enter the mobile phone chip market with the foundation of Leadcore and enhance its control over the industrial chain.
Later in February 2017, Xiaomi officially released Pinecone Electronics' first mobile phone SoC chip "Pengpai S1" at the Beijing National Convention Center. The SoC chips used in mobile phones mainly include AP (Application Processor) and BP (Baseband Processor). The Pengpai S1 was launched less than 3 years after Pinecone Electronics was established, and its speed was quite fast. But considering the previous accumulation of Unigroup, this achievement is not incredible. But since then, from 2017 to the present, the iterative version of Pengpai S1-Pengpai S2 has not been released. The rumor that Pengpai S2 has been unable to be mass-produced due to too many tape-outs has also become a hot topic. In April 2019, Pinecone Electronics split out Dayu Semiconductor, and the focus of research and development shifted to IoT chips. In 2020, some media reported that Pinecone Electronics transformed into Xiaomi Pinecone Electronics, but the new terminal chip is still nowhere to be seen.
On May 26, 2017, Qualcomm (China) Holdings Co., Ltd., Beijing Jianguang Asset Management Co., Ltd., Unicore Technology Co., Ltd. and Beijing Zhilu Asset Management Co., Ltd. jointly signed an agreement to establish a joint venture company - JLQ Technology (Guizhou) Co., Ltd. (JLQ Technology). The joint venture will focus on the smartphone chipset business in China. This move has caused widespread controversy in the industry, and some people even use all kinds of unpleasant words to describe the company. Unicore and JLQ, which have been the flag bearer of the independent communication protocol TD-SCDMA, Datang Telecom, were actually given such a title in the end, which is really full of black humor in the absurdity.
Spreadtrum is the most well-known and powerful domestic terminal chip company in the 3G era. On June 27, 2007, Spreadtrum was listed on NASDAQ as "China's first 3G concept stock". On the first day of IPO, the stock price soared to US$15.95, with a market value of US$1.98 billion on the same day, becoming China's first listed chip platform company and the largest design company by market value. Overnight, Spreadtrum became a household name in the industry.
Spreadtrum was founded by "returnees" such as Chen Datong. In 2000, the Ministry of Information Industry (the predecessor of the Ministry of Industry and Information Technology) issued "Document No. 18", which for the first time clearly encouraged the development of the software and integrated circuit industries. A group of overseas people were ready to return to China to start businesses and contribute to the development of China's integrated circuits. Chen Datong and Wu Ping organized a 15-member academic entrepreneurial team to return to China to establish Spreadtrum Communications, with the goal of "building a company in China that is internationally leading in technology from the beginning."
Spreadtrum successfully developed the first domestic 3G standard core mobile phone chip in 2004, which helped TD get out of the predicament of lack of mobile phone core chip support and achieved a breakthrough in the core technology of mobile communication terminals. In 2007, Spreadtrum released the SC8800S chip, which is a TD-SCDMA/GSM dual-mode baseband chip designed for the data card market and supports HSDPA/EDGE. With the launch of SC8800S, Spreadtrum believes that the various TD-SCDMA technology solutions it provides will target different market needs and promote the commercialization of 3G technology.
Spreadtrum's bet on China's 3G TD technology is one of its major features and the main reason why Spreadtrum was able to successfully go public in the United States with a 3G concept. But apart from the external splendor, Spreadtrum had problems internally. At that time, Spreadtrum liked to give orders to customers, but turned a blind eye to customer needs and problems. At that time, Spreadtrum's 2G chip product quality had always been unstable, and customers had many complaints, but no R&D department had any specific actions to solve them, so customers had to return disappointed. With Spreadtrum's repeated mistakes in the market, Wu Ping, who was the company's chairman and CEO at the time, made frequent strategic and organizational adjustments in a hurry, but because Spreadtrum had been in a long-term internal friction and infighting, and its execution was poor, it was still unable to reverse the decline.
In 2008, a large number of company founders and VPs (Vice Presidents) resigned, making the originally fragile management system even more vulnerable. In February 2009, Wu Ping resigned from the CEO position, and Li Liyou, then the president of Spreadtrum, was promoted to president and CEO, while Wu Ping, the former CEO and chairman, became the company's chairman. Li Liyou, who took over the position of president and CEO in February 2009, faced a huge black hole: from products to markets to company management, all were plagued by chronic problems, and the stock price fell to the bottom. After Li Liyou took office, he implemented a strategy of streamlining administration: only hold useful and fruitful meetings, only do useful and fruitful things, and send all VPs to grassroots teams; enable job accountability system, establish a result-oriented work evaluation system, and a 360-degree collaboration system assessment system for departments, taking the degree of collaboration as a new means of employee development, while standardizing the company's operating procedures, clarifying the responsibilities of each link, and eliminating internal friction.
Li Liyou required all employees to meet with customers. According to a customer boss who worked on Spreadtrum platform, Li Liyou often visited customers who lost money due to Spreadtrum products, listened to customers' questions and suggestions, and the bosses of mobile phone companies with hundreds of employees or dozens of employees became his guests. A small customer once lamented that due to the small scale of his company, not to mention Spreadtrum CEO, even Spreadtrum's sales vice president had never visited his company. In 2009, Spreadtrum launched a cost-effective 2G chip 6600L. The performance of this product was considered by the industry to be better than the flagship product 6225 of its competitor MediaTek, but the cost was much lower than 6225. Spreadtrum decisively seized the opportunity and regained customer support with this "product that can make money".
In December 2009, the world's first OPhone phone "Lenovo O1" using Spreadtrum chips was launched on China Mobile's customized 3G mobile phone platform OPhone. At the same time, Spreadtrum won 70% of the market share in TD wireless fixed-line phones. In the same year, Spreadtrum won a number of national major science and technology projects, including the major national projects of core high-tech and basic research, and the new generation of broadband wireless mobile communication network. Spreadtrum's stock price also increased eightfold.
With the continuous development of its business, Spreadtrum released the world's first 40nm TD-SCDMA terminal chip in 2011, which meant that Chinese mobile phone chip manufacturers surpassed international giants for the first time. At that time, the mainstream chips of mobile phone chip manufacturers including Qualcomm were only manufactured at a process of 65nm, and the process of Qualcomm's latest WCDMA mobile phone chip was only 45nm.
But the competition in technology never stops. When the era moved from 3G to 4G and from feature phones to smartphones, Spreadtrum faced new challenges. The 4G era means that terminal chips need to support more standards, and smartphones mean that terminal chips need to further improve speed and user experience. In December 2013 and July 2014, Tsinghua Unigroup privatized Spreadtrum and RDA Microelectronics for US$1.78 billion and US$907 million respectively, and the two companies subsequently delisted from NASDAQ. With the support of Tsinghua Unigroup, Tsinghua Unigroup (a new company integrating Spreadtrum and RDA Microelectronics) subsequently released a number of terminal chips such as SC9853I, SC9850, SC9830, and SC9860.
In the fierce competition of the 4G era, many old chip companies have withdrawn from the terminal chip field, including TI and Marvell. In 2016, Spreadtrum and RDA officially merged and reorganized to become Unisoc. On February 26, 2019, Unisoc released the 5G communication technology platform - Makalu and its first 5G baseband chip - Springtide 510. 2020 is the first year of 5G commercial use. There are only five suppliers with 5G mobile phone chip R&D capabilities in the world, namely Qualcomm, HiSilicon, MediaTek, Samsung and Unisoc. After experiencing wind and rain, ups and downs, no matter how bumpy the fate is, Spreadtrum's lineage was finally able to continue. It is expected that in the 5G era, Unisoc will continue to keep up with the pace and not fall behind, and pass on the torch of mobile terminal chips.
In addition to the above five companies, MediaTek was also an important participant in TD-SCDMA terminal chips. However, MediaTek's story is more complicated and dramatic, and TD-SCDMA terminal chips are only a part of MediaTek's history, so this article will not discuss MediaTek. Another domestic mobile terminal chip giant, HiSilicon, was not included in this discussion because it did not participate in many TD-SCDMA terminal chips in the 3G era.
4. Postscript
TD-SCDMA is a great attempt and a great breakthrough in China's development of mobile communications. It is hard to say that a clear path of "driving the industry with technical standards" had been formed when China's own 3G standard was proposed in 1996. The author tends to think that this is the same as the countless "crossing the river by feeling the stones" exploration methods since the reform and opening up of our country, which is to move forward step by step and make continuous adjustments in the process of exploration. Therefore, it is hard to say that the "fence" effect of TD-SCDMA on the domestic chip industry, especially the terminal chip industry, is intentional.
Domestic TD-SCDMA terminal chip manufacturers can be said to have benefited from the TD-SCDMA standard. After all, it would be difficult to create such a unique and huge single market without China proposing and strongly promoting this set of standards. From an objective analysis in retrospect, chips oriented to communication standards are "background chips". Since they do not need to be developed for end users, they are less dependent on the industry "ecology" such as tool chains and application software. Compared with high-end general-purpose chips such as CPUs, GPUs, and FPGAs, the difficulty of solving industrial supporting problems is lower, the market is simpler, and the customer base is more single. After encountering a major setback in the industrialization of general-purpose processors in the early 21st century, TD-SCDMA terminal chips did explore a possible direction for the development of domestic chips at that time.
However, the development of TD-SCDMA terminal chip manufacturers is also constrained by the defects of the TD-SCDMA standard. The formulation of communication standards is an extremely complex task. Many of the technologies that look good do not work well in actual use, and some may even increase the design complexity of the equipment. In order to avoid being merged with other standards when the TD-SCDMA standard was formulated, it must also adopt some more radical technologies that are not available in other standards. In addition, China's communication technology level was backward in all aspects at the time, and the industry's supporting capabilities were limited. This later caused the commercial use of TD-SCDMA to be delayed again and again. If it were not for the strong promotion of the national will, it might really end in vain. This also had an adverse impact on TD-SCDMA terminal chip manufacturers in the future.
If the complexity and implementation difficulty of 3G communication standards have delayed the large-scale commercial use of TD-SCDMA, limiting the implementation of the strategy of starting with standards to drive industrial development, then would it be better to start with a standard that is less technically difficult and has a more closed market? Readers who have this question can look forward to the next episode:
Helpless Flowers Fall - The Past of CMMB Terminal Chips.
At the end of the article, let me explain the title of this article. When it comes to "fences", the strongest and most effective fence in China must be the Great Wall, so the author thought of the phrase "The Great Wall is ten thousand miles long". But what is the "Great Wall" in the field of chip design? Perhaps there is no standard that can be called the "Great Wall", not to mention that what is outside the Great Wall is also "hometown"? Due to the limitations of my level and length, I can't make further analysis. I can only list Luo Wen's version of "The Ballad of the Great Wall" at the end of the article for readers.
"The Ballad of the Great Wall" sung by Roman Tam, lyrics by Lo Kwok-chum
Thousands of stones piled up
To keep our borders peaceful
Soldiers call for help from inside and outside the city
But today I feel so lonely
Who will judge the merits and demerits of the ages?
Meng Jiang's daughter cries about her miserable life
Anger and sorrow have long gone with the sun and the moon
The giant arms still embrace the mountains
History requires him to personally guarantee
China must prosper forever
We will win every battle against powerful enemies
The Great Wall A Soldier
Thousands of years of fighting on the city walls
China has experienced few changes and has enjoyed little stability
Every man in the old city is a hero
How many of them have my last name?
This article is jointly produced by Semiconductor Industry Observer and the LeXiang Network Master Studio of the University of Electronic Science and Technology of China. This series of articles is also part of the "Learn the Four Histories and Keep the Original Intention" series of education conducted by the LeXiang Network Master Studio. The LeXiang Network Master Studio is an online education studio set up by the School of Electronic Science and Engineering (Demonstration School of Microelectronics) of the University of Electronic Science and Technology of China around Associate Professor Huang Letian, a famous online teacher of the University of Electronic Science and Technology of China. It mainly shares knowledge and viewpoints related to integrated circuits, hoping that through the sharing of teachers, learning and work will become happy and happy. The information involved in this article was mainly found by Liu Fengrui, the head of the student team of the LeXiang Network Master Studio, and teacher Huang Letian edited the information and wrote the article. The editorial department of Semiconductor Industry Observer supplemented and reviewed it.
*Disclaimer: This article is originally written by the author. The content of the article is the author's personal opinion. Semiconductor Industry Observer reprints it only to convey a different point of view. It does not mean that Semiconductor Industry Observer agrees or supports this point of view. If you have any objections, please contact Semiconductor Industry Observer.
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