China's Huawei Returning To 5G Phone Market With SMIC Chips
Reuters and Nikkei Asia have closely followed rumors over the past two weeks of a possible collaboration between Huawei and Semiconductor Manufacturing International Corporation (SMIC) to begin mass production of 5G chips by the end of 2023. The goal of this joint effort is to support Huawei's flagship smartphones and facilitate the company's return to the 5G market in 2024.
The question is whether the cooperation between Huawei and SMIC in the development of 5G chips is a difficult task. Certain problems may be related to design or manufacturing.
It should be noted that Huawei has taken significant steps in developing its 5G chip. In September 2019, the company officially unveiled its flagship Kirin 990 5G chip at the IFA event. At the time, the Kirin 990 5G chip was billed as the world's first 5G system-on-a-chip (SoC) and was manufactured using TSMC's advanced 7nm EUV process. The Kirin SoC is introduced with the Balong 5000 chipset integration.
In terms of patents and technology, Huawei has successfully developed HiSilicon Balong and successfully integrated it into the Kirin 990 5G. But when it comes to practical implementation, Huawei has faced hurdles due to TSMC's ban due to export control regulations during the US-China tech war, which led to the termination of its collaboration with HiSilicon. Now, aside from buying chips from Qualcomm and MediaTek, the company has limited options if it plans to re-enter the 5G smartphone market: it can either bring back the Kirin SoC or use the Balong 5000 chipset as an external add-on. . with a separate application processor (AP). In terms of manufacturing and performance, Huawei mainly depends on product SMIC. As for the available chip source options, they are limited to 4G chips. Considering the disruption of TSMC's original manufacturing process and the limited availability of 5G chips from Qualcomm, MediaTek and even Samsung Electronics, Huawei had to spend a lot of time and effort to find a solution with SMIC to produce 7nm chips outside of TSMC's expansion service.
It is important to note that placing an external 5G modem chip in a smartphone leads not only to unstable signals, but also to additional power consumption of the device. Unlike Samsung's own 5G chips and Qualcomm's sophisticated manufacturing experience, Huawei has managed to integrate the modem chip and SoC into the Kirin 990 5G. However, the duplication that TSMC can achieve poses a challenge for Huawei to manage through SMIC. It is not clear how long Huawei will need to complete this task.
In the year In the summer of 2022, after the research institute Tech Insights broke down a customer chip for mining using the 7nm SMIC process, it became clear that the company is increasingly likely to switch to a 7nm node. Although SMIC did not officially recognize this and Chinese media initially reported it enthusiastically, the information mysteriously disappeared from Chinese online platforms. However, a year later, new reports in Chinese media that Huawei and SMIC are collaborating to produce 7nm 5G chips have reignited many in the US-China technology rivalry.
That raises the question of whether Beijing will take steps in response to the Biden administration's approach of comparing China to the Trump administration. It should be noted that in mid-July, former SMIC Chairman Gao Yonggang stepped down and Liu Shunfeng, who was recommended by the Grand Fund, took over. This suggests that Beijing authorities may have more influence over the direction of SMIC. In contrast to SMIC's previous direct approach, to avoid a direct conflict with the US, the current cooperation between SMIC and Huawei on 7nm 5G chips can be seen as a concern.
Previously, TSMC used the 7nm EUV process to build Huawei's Kirin 990 5G chip. However, currently, SMIC can only achieve 7nm mass production with multiple exposures using DUV. Given the performance and capabilities of SMICs and Huawei's internal-use-only business model, the 7nm SMIC process is expected to prioritize functionality over performance, limiting performance and capacity constraints. This begs the question: Is it better to keep Huawei's 5G chips, whether SoCs or modem chips, for domestic use, even if they do return? In a less favorable scenario, there is a concern that SMIC may offer some device models only in symbolic form.
The widespread acceptance of Huawei's 5G chips in China, such as Honor, Oppo and other brands, depends on two main factors: if Huawei approves it, and the performance and heat dissipation capacity of SoC or 5G chips produced by Huawei SMIC, to compete with Huawei. Unknown 5G chips. Qualcomm and MediaTek. Solutions While Huawei's 7nm 5G chip manufacturing contract is of strategic importance to China's advanced chip manufacturing, achieving commercial profitability may be a challenge for SMIC. In addition, the release of Huawei's 5G chips in 2023 or 2024 and the release of its 5G smartphones will inevitably demonstrate the capabilities of SMIS with the 7nm process. This could have implications for future SMIC orders and equipment supplies by semiconductor equipment manufacturers in the US, Japan and the Netherlands. Finally, the profitability of the collaboration between Huawei and SMIC to produce 7nm 5G chips remains uncertain.
