How a Chinese chip foundry came to pose a threat to world's leading semiconductor companies
In the early 2000s, Stanford scientist Yoshio Nishi visited the newly-built factory of the Semiconductor Manufacturing International Corporation in Shanghai, China.
SMIC is what industry people call a pure-play foundry or a fab, which manufactures integrated circuits designed and developed by other companies such as AMD and NVIDIA. Despite government subsidies, SMIC had always trailed a few generations behind competitors such as the Taiwan Semiconductor Manufacturing Company and the US-based GlobalFoundries.
Industry analysts weren’t expecting SMIC to achieve this capability, especially as the US had blocked China’s access to cutting-edge EUV lithography machines, essential to producing advanced chips. “It is certainly behind TSMC and Intel, but not as far behind as you may think. It is getting an enormous amount of Chinese government money to help it catch up,” he tellsAdvanced chips, especially those behind artificial intelligence applications, can also be deployed in sophisticated weapons such as drones and missiles.
By 2014, SMIC counted Qualcomm as one of its clients and the company was spending heavily on R&D to compete with TSMC, GlobalFoundries and Samsung.
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