Huawei Technologies, one of the world’s leading smartphone and telecom equipment makers, has recently unveiled its new flagship smartphone, the Mate 60 Pro, which features a 7nm system-on-chip (SoC) designed by Huawei’s own HiSilicon subsidiary and manufactured by China’s Semiconductor Manufacturing International Corporation (SMIC). This is a remarkable achievement for Huawei and SMIC, as it demonstrates their ability to overcome the US sanctions that have cut off their access to advanced chip production from Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest contract chipmaker. It also shows China’s progress in developing its own semiconductor industry, which is crucial for its economic and national security.
What is a 7nm chip and why does it matter?
A 7nm chip refers to a semiconductor device that has transistors with a size of about 7 nanometers (nm), or billionths of a meter. Transistors are the basic building blocks of electronic circuits that switch or amplify electrical signals. The smaller the transistors, the more of them can be packed on a chip, which increases the performance, power efficiency, and functionality of the device. A 7nm chip can have about twice as many transistors as a 14nm chip, which is the previous generation of technology.
The 7nm node is considered a cutting-edge technology in the semiconductor industry, as it requires sophisticated equipment, materials, and processes to produce. Only a few companies in the world can make 7nm chips, such as TSMC, Samsung, Intel, and now SMIC. These chips are widely used in high-end applications such as smartphones, computers, servers, artificial intelligence (AI), and 5G networks.
How did Huawei and SMIC achieve this feat?
Huawei and SMIC have been working together for years to develop their own chips, especially after the US imposed export restrictions on Huawei in 2019, barring it from buying chips made with US technology. This effectively blocked Huawei from sourcing chips from TSMC, which used to supply most of Huawei’s high-end SoCs. Huawei had to rely on its own HiSilicon division to design chips and find alternative manufacturers to produce them.
SMIC was one of the main candidates for Huawei’s chip production, as it is China’s largest and most advanced foundry. However, SMIC was also subject to US sanctions in 2020, which limited its access to advanced equipment and materials needed for making 7nm chips. SMIC had to use its existing deep ultraviolet (DUV) lithography machines, which are less capable than the extreme ultraviolet (EUV) lithography machines used by TSMC and Samsung for 7nm production. SMIC also had to overcome technical challenges such as multi-patterning, which is a technique to create finer features on a chip by repeating the exposure process multiple times.
According to TechInsights, a semiconductor research firm, SMIC produced Huawei’s new Kirin 9000S SoC using its second-generation 7nm process called N+2, which is an improvement over its first-generation N+1 process. The Kirin 9000S has four high-performance cores and four energy-efficient cores based on Huawei’s own TaiShan microarchitecture, which is compatible with Arm’s instruction set architecture (ISA). It also has a Mali-G910 graphics processing unit (GPU) and an AI accelerator. The Kirin 9000S has a die size of 107 square millimeters (mm2), slightly larger than the Kirin 9000 (105 mm2), which was made by TSMC on its 7nm process.
What are the implications and challenges for Huawei and SMIC?
Huawei’s new 7nm chip is a significant milestone for the company and SMIC, as it proves their resilience and innovation in the face of US pressure. It also gives Huawei a competitive edge in the smartphone market, as it can offer a flagship device with a powerful and efficient SoC that supports 5G connectivity. Moreover, it boosts China’s confidence and ambition in developing its own semiconductor industry, which is a strategic priority for the country.
However, Huawei and SMIC still face many challenges and uncertainties ahead. For one thing, their new 7nm chip is still behind the state-of-the-art technology offered by TSMC and Samsung, which have already moved to 5nm and are preparing for 3nm production. Their new chip also has limited supply and demand, as SMIC does not have enough capacity to meet Huawei’s needs or other customers’ demands. Furthermore, Huawei and SMIC may face more US sanctions or restrictions in the future, which could hamper their access to key resources or markets.
What are the trends and roadmap for the semiconductor industry?
The semiconductor industry is undergoing rapid and profound changes, driven by various factors such as demand, supply, innovation, competition, and geopolitics. Some of the major trends and roadmap for the industry are:
- Demand: The demand for semiconductors is expected to grow steadily in the coming years, as more devices and applications require chips for processing, storage, communication, and sensing. Some of the key drivers of demand are the Internet of Things (IoT), AI, 5G, cloud computing, edge computing, autonomous vehicles, and smart cities. According to the World Semiconductor Trade Statistics (WSTS), the global semiconductor market is projected to grow by 8.8% in 2023, reaching $573 billion.
- Supply: The supply of semiconductors is facing challenges such as shortages, bottlenecks, disruptions, and costs. The COVID-19 pandemic has exposed the vulnerabilities and imbalances of the global semiconductor supply chain, which relies heavily on a few regions and companies for production. The US-China trade war has also intensified the competition and conflict over semiconductor resources and markets. To address these issues, many countries and companies are investing in expanding and diversifying their semiconductor manufacturing capabilities and capacities. For example, the US has passed the CHIPS Act to provide $52 billion in funding for semiconductor research and production. The EU has launched the European Chips Act to boost its chip sovereignty and competitiveness. China has launched the National Integrated Circuit Industry Investment Fund to support its domestic chip industry. TSMC, Samsung, Intel, and others have announced plans to build new fabs or expand existing ones in various locations.
- Innovation: The innovation in semiconductors is driven by the need to improve performance, power efficiency, functionality, and integration of chips. The industry is pursuing various approaches to achieve these goals, such as scaling down the transistor size (More Moore), adding more functions on a chip (More than Moore), and exploring new materials and architectures (Beyond CMOS). Some of the emerging technologies that are expected to shape the future of semiconductors are quantum computing, neuromorphic computing, silicon photonics, carbon nanotubes, graphene, spintronics, and memristors.
- Competition: The competition in the semiconductor industry is intensifying among different players and regions. The industry is witnessing a wave of consolidation through mergers and acquisitions (M&A), as well as strategic partnerships and alliances. Some of the recent examples are Nvidia’s acquisition of Arm, AMD’s acquisition of Xilinx, Marvell’s acquisition of Inphi, Analog Devices’ acquisition of Maxim Integrated, SK Hynix’s acquisition of Intel’s NAND business, Qualcomm’s partnership with TSMC for 5nm chips, and Apple’s partnership with TSMC for 3nm chips. The industry is also facing new entrants and challengers from various sectors and regions. Some of the notable examples are Huawei’s HiSilicon division, Alibaba’s Pingtouge division, Amazon’s Annapurna Labs division, Google’s Tensor division, Baidu’s Kunlun division, Tesla’s Autopilot division, India’s Reliance Jio division, and Vietnam’s VinSmart division.
- Geopolitics: The geopolitics of semiconductors is becoming more complex and influential in shaping the industry dynamics and outcomes. The US-China rivalry is the most prominent factor that affects the global semiconductor landscape. The US is trying to maintain its technological leadership and national security by restricting China’s access to advanced chips and equipment. China is trying to achieve its technological independence and self-reliance by developing its own chip industry and ecosystem. Other countries and regions are also trying to balance their interests and roles in the global semiconductor arena. For example, Taiwan is trying to protect its status as the world’s leading foundry while maintaining its relations with both the US and China. Japan is trying to revive its semiconductor industry while leveraging its strength in materials and equipment. South Korea is trying to expand its semiconductor portfolio while coping with its domestic political issues. Europe is trying to increase its semiconductor sovereignty while collaborating with other partners.
The semiconductor industry is facing a critical juncture in its history, as it confronts both opportunities and challenges in a fast-changing world. The industry needs a clear vision and strategy to navigate through these uncertainties and complexities. The industry also needs a collaborative spirit and a cooperative framework to foster innovation and growth for all stakeholders. As Yogi Berra said, “If you don’t know where you are going, you end up somewhere else.” In an industry as important as semiconductors, “somewhere else” won’t cut it.