ZTE ban underlines urgent need for innovation

By Wu Jin
0 Comment(s)Print E-mail China.org.cn, April 21, 2018
Adjust font size:

On April 16 , the U.S. President Donald Trump's administration imposed a seven-year ban on Chinese telecom equipment maker ZTE Corp., forbidding U.S. companies from selling products and services to it--a blow directly targeting China's vigorous and imminent application of 5G.

Chinese telecom equipment maker ZTE Corp. holds a press conference at its headquarters in Shenzhen, south China's Guangdong Province, April 20, 2018. [Photo/Xinhua]

The prohibition includes chips purchased from Qualcomm, a potentially lethal strike that may hinder the Shenzhen-based technological firm from fulfilling its 5G plan.

ZTE suspended share trading and delayed the release of quarterly report after the ban was declared. According to some foreign media coverage, ZTE will possibly be denied accesses to Android platform developed by Google Inc. However, reports still need to be confirmed as ZTE has not yet completed a full assessment of the ban.

As the tensions of a possible trade war escalate between China and the United States, there are growing concerns about China's technological disadvantages, especially the technology of homemade chips.

According to IC Insights, last year, the top 10 chip manufacturers around the world, including Samsung, Intel and Qualcomm, occupied 58.5 percent of the market share (or US$438.5 billion) in the semiconducting sector. However, the listing contains no Chinese firms, not even the Hisilicon, China's most lucrative chip technology provider.

Sales of Hisilicon reached US$6.16 billion last year, which was US$3.04 billion less than NXP Semiconductors.

According to a recent report released by Strategy Analytics, a Boston-based research center that carries out marketing analysis of information and telecommunication technologies, the shipment of Qualcomm's smart phone processors grew by 4 percentage points to 42 percent last year.

Additionally, the Taiwan-based MediaTek Inc. and Shanghai-headquartered Spreadtrum Communication Inc., the two traditional IC designers, showed signs of decline.

Established in 1985, Qualcomm has benefited considerably from the Code Division Multiple Access (CDMA) technology throughout its years of development.

Jiang Jun, the principal engineer of the Consultancy and Planning Institute of Huawei, said that the round of sanctions imposed by Trump's administration on China's technological firm possibly resulted from the U.S. government's concern about China's high-profile plans for 5G application.

"China's advancement probably hits the nerve of the US," he said.

But the transformation of industrial chains following Trump's hard blow to ZTE will have an effect in the future.

China's business magnates--Jack Ma, CEO of Alibaba Group and Xu Jiayin, founder of the Evergrande Group--recently announced plans to expand into homemade chips.

Alibaba's Academy for Discovery, Adventure, Momentum and Outlook (Alibaba DAMO Academy) is working on a neural network chip—Ali NPU—which is expected to be 40 times more cost-effective than the traditional CPU or GPU. The invention is projected to facilitate the video and graphic processing and robotic learning among other artificial intelligence applications. The company also announced that it has acquired Hangzhou-based C-SKY Microsystems Co Ltd, an integrated circuit design house.

The Evergrande Group, a prominent property developer and football club owner, announced that it will invest 100 billion yuan (US$15.93 billion) to partner with Chinese Academy of Sciences in the following decade to develop cutting-edge technologies, including integrated circuits.

Follow China.org.cn on Twitter and Facebook to join the conversation.
ChinaNews App Download
Print E-mail Bookmark and Share

Go to Forum >>0 Comment(s)

No comments.

Add your comments...

  • User Name Required
  • Your Comment
  • Enter the words you see:   
    Racist, abusive and off-topic comments may be removed by the moderator.
Send your storiesGet more from China.org.cnMobileRSSNewsletter