These are the most-read DIGITIMES Asia stories in the week of October 21 - October 25.
Micron, Intel, and Tesla get hit with collateral damage from China's national security measures
China has raised cybersecurity concerns about Intel's CPUs, suggesting they contain backdoor vulnerabilities posing national security risks, with local media amplifying the message. This follows previous scrutiny of US companies like Micron, signaling to the US that ongoing sanctions and tariffs on Chinese tech could face Chinese retaliation.
The recent rise of Chinese semiconductor companies such as Loongson and Zhaoxin, which now command a significant share in state and public markets, indicates China's growing self-sufficiency in technology. Huawei is also fully transitioning its ecosystem to HarmonyOS, moving away from Android and Microsoft.
Amid increasing tension, Tesla appears to be a potential future target, with officials implying data compliance requirements for operations in China. This environment reflects a shift where business strategies are heavily influenced by national security agendas, complicating operations for foreign tech firms amidst China's prioritization of self-reliance.
SiC prices plunge as Chinese capacity soars, reshaping semiconductor landscape
In 2024, Silicon carbide (SiC) prices fell sharply as Chinese manufacturers ramped up production, creating an oversupply, particularly for 6-inch and 8-inch substrates. China's dominance in SiC's major application areas, like EVs and solar panels, raises concerns for non-Chinese systems as the government drives semiconductor self-sufficiency.
While Taiwanese SiC companies, known for high-quality, reliable products, face challenges competing with China's low-cost output, they find opportunities in the US, Europe, and Japan, which seek alternatives to Chinese suppliers. Doris Hsu, chairperson of Sino-American Silicon Products and GlobalWafers, emphasized the critical importance of quality and safety in SiC, especially for automotive and industrial applications.
Although the current low prices reflect a supply-demand imbalance, Hsu foresees SiC's application expanding across various sectors due to its unique properties.
TSMC navigates rumored strained relationship with Nvidia and shipments to Huawei
TSMC's strong third-quarter performance in 2024 has impressed the global market, but rumors about its alleged indirect sales to Huawei and shipment delays with Nvidia's Blackwell chips have raised concerns. While the US Department of Commerce reportedly questioned TSMC about potential Huawei sales through intermediaries, TSMC maintains strict compliance with export regulations and denies any involvement.
Despite rumors of strained relations with Nvidia over Blackwell chip delays, industry experts downplay the issue, highlighting TSMC's and Nvidia's long-term partnership and reliance on each other. Meanwhile, TSMC continues its global expansion to mitigate geopolitical risks, including fabs in the US, Germany, and Japan. The company's stability and market positions remain strong, with no indication of illegal dealings or risky customer engagements.
Qualcomm and Arm's ambitions for Intel's product department may be futile
Rumors suggest Qualcomm and Arm are exploring the acquisition of Intel's product division, specifically its PC processor unit, as Intel navigates a difficult period in its history. However, industry experts are doubtful these deals will materialize, with Arm facing especially steep challenges due to its smaller scale, potential customer conflicts, and reliance on SoftBank.
Both Arm and Qualcomm aim to expand their PC market presence and leverage Intel's weakening position, though Intel remains a formidable competitor with its robust x86 market share. Political implications also loom large; as Intel stands to receive significant CHIPS Act subsidies, any sale of its assets would likely spark regulatory scrutiny in the US, especially if a foreign company like Arm were involved.
Intel seeks foundry alliance with Samsung to challenge TSMC's market dominance
Intel has reportedly proposed a "foundry alliance" with Samsung Electronics in an effort to challenge TSMC's dominance in the semiconductor manufacturing market. This potential partnership arises as both Intel and Samsung grapple with struggles in their foundry operations.
Intel's CEO Pat Gelsinger may meet Samsung's chairman, Jae-Yong Lee, to discuss comprehensive cooperation. Together, Intel and Samsung could explore collaboration on advanced technologies, shared facilities, and R&D efforts, leveraging Intel's Foveros and PowerVia technologies and Samsung's 3nm Gate-All-Around process.
While this alliance could increase their competitive edge in AI, data centers, and mobile applications, analysts caution that it may not significantly disrupt TSMC's stronghold, as TSMC still commands approximately 62% of the foundry market and over 90% in advanced process technologies. Regulatory factors, including substantial US government subsidies and export controls, also play a role in Intel's move toward collaboration with Samsung.
Micron anticipates AI demand boost as EUV-based DRAM enters production in 2025
Micron Technology is fully allocating its HBM (High Bandwidth Memory) production capacity for 2025 to meet the rising demand driven by AI applications, which the company expects to expand from cloud servers to consumer devices. Corporate VP Donghui Lu emphasized that AI is creating unprecedented demand for memory solutions, with a particular need for advanced packaging in HBM production, a process that challenges the traditional boundaries between wafer fabrication and packaging.
Micron's close collaboration with TSMC in Taiwan strengthens its production capabilities, especially for HBM3E products using TSMC's CoWoS technology. While the company is delaying EUV equipment adoption for cost-efficiency and competitive advantage, it plans to implement EUV in Taiwan by 2025. Lu is optimistic about Micron's performance, projecting that 2025 will mark its highest revenue year, underpinned by the demand for AI-related memory products and the integration of AI capabilities into consumer devices.
China's first 3nm SoC by Xiaomi marks a seven-year gap since its last launch, likely manufactured by TSMC
Xiaomi's self-developed 3nm mobile SoC has reportedly entered the tape-out phase, potentially making Xiaomi the first Chinese company to produce a 3nm chip, with TSMC likely serving as its manufacturing partner due to its advanced capabilities and SMIC's limitations in this area.
The announcement was made by Jianguo Tang, a Beijing municipal official, during a public event, though both Xiaomi and TSMC have yet to confirm the details.
The news emerged amid tightened US sanctions, which have pushed Chinese tech firms toward self-reliance in advanced chip development. This 3nm chip marks a major leap for Xiaomi, whose previous efforts were focused on 28nm chips for imaging and power management, rather than full SoCs. Xiaomi's shift aligns with the broader trend of rising costs in flagship smartphone production due to the adoption of advanced processors, and the company is extending its chip expertise to other smart devices, such as TVs and peripherals, as it broadens its technological portfolio.
