Shenzhen Tops Nation in IC Design Industry Scale

By Wang Hairong, Shenzhen Business Daily

July 4, 2018 - The 2018 China (Shenzhen) Integrated Circuit Innovation Application Summit Forum was held in Shenzhen on July 4. Focusing on the theme "Intelligent Era Drives New Applications for Integrated Circuits," industry experts and corporate leaders from China and abroad engaged in discussions about collaborative innovation within the IC industry chain, future hotspots, and innovative applications.

The forum was co-hosted by the IC Design Branch of the China Semiconductor Industry Association (CSIA) and the National IC Design Shenzhen Industrialization Base.

Shenzhen's IC Industry Scale Reaches RMB 66.84 Billion

Wu You, Deputy Secretary-General of the Shenzhen Municipal People's Government, stated in his speech that Shenzhen is a national application center, distribution hub, and design center for IC products, with its IC design industry scale accounting for approximately 30% of the national total. With the settlement of ARM's China headquarters in Shenzhen, the formal registration of the Third Generation Semiconductor Innovation Research Institute, and the national "Core High-Base" EDA major project landing in Shenzhen, Shenzhen's IC industry has entered a new development stage. Enterprises related to ICs are on a fast track of development. The next phase will involve順應 industry trends and encouraging companies to increase investment in core technology R&D.

According to statistics, the overall scale of Shenzhen's IC industry reached RMB 66.84 billion in 2017, a year-on-year increase of 17.4%. The IC design sector accounted for RMB 59.002 billion (88.27%), IC packaging and testing reached RMB 6.224 billion (9.31%), and IC manufacturing was RMB 1.614 billion (2.41%).

Data from the IC Design Branch of the CSIA shows that Shenzhen's IC design scale has grown from RMB 300 million in 2002 to RMB 59.002 billion in 2017, ranking first in China for many consecutive years. In 2017, the national IC design industry scale was RMB 207.35 billion, with Shenzhen accounting for 28.46%.

Shenzhen's IC design industry also shows a trend where leading enterprises have significant advantages and resources are concentrating towards large companies. Among the top 10 Chinese IC design companies in 2017, four were from Shenzhen. Shenzhen HiSilicon Technologies Co., Ltd. ranked first with sales of approximately RMB 36.26 billion, nearly equaling the combined sales of the next six companies on the list. The other three Shenzhen companies were Shenzhen ZTE Microelectronics Technology Co., Ltd., Shenzhen Goodix Technology Co., Ltd., and FocalTech (Shenzhen) Co., Ltd., ranking 3rd, 6th, and 9th respectively.

The list of the top 20 Shenzhen IC design companies by sales in 2017 included, besides the leaders like HiSilicon, ZTE Microelectronics, Goodix, and FocalTech, companies such as Longsys, BYD Microelectronics, Kimtigo, SMIT, Nationz, State Microelectronics, and Invengo.

"Unicorn" Companies Entering Chip R&D

In terms of design capability, Shenzhen's IC design level ranks among the nation's best, aligning with international standards, with 37% of companies possessing 40nm-65nm design capabilities.

Zhao Qiuqi, Deputy Director of the National IC Design Shenzhen Industrialization Base, pointed out that the characteristics of Shenzhen's design industry are its closeness to application markets. IC design is market-oriented, with diversified product development. Artificial Intelligence (AI) and 5G applications are new hotspots for chip design. Current statistics on IC products and application areas show the top three are the Internet of Things (IoT), display lighting & touch control, and communications. Applications in data storage, digital multimedia, and automotive electronics follow closely. Chip companies are active in many application fields, and some rapidly growing "unicorn" companies have begun involved in chip R&D, such as Orbbec, CloudMinds, and DJI Innovations, which have already made their mark in chip development.

AI Becomes New Driver for Semiconductor Industry Growth

At the forum, Wei Shaojun, Chairman of the IC Design Branch of the CSIA, emphasized in his speech that China's IC industry must maintain healthy development, avoiding both arrogance and undue pessimism.

Lung Chu, President of SEMI China, noted that the semiconductor industry sees a killer application emerge every 10 to 20 years. Current intelligent applications are developing towards diversification and variety. AI has become a major driver for the semiconductor industry's growth in the coming years. Smart cities, intelligent transportation, smart homes, smartphones, smart manufacturing, intelligent transportation, and 5G communication will all drive significant development in logic circuits and memory circuits.