In the past year, the ZTE incident and the trade war between China and the US has aroused various social circles’ reflection on China’s current development and also backwardness in high-tech fields, in particular, the fields of chips (integrated circuits) and artificial intelligence. For this, Steve Deng indicated during a recent media interview that in such fields as integrated circuit design and core components manufacturing, it may take several generations of unrelenting effort and accumulation for China to keep up with European countries and the US. But in the field of chip manufacturing, where sensors are combined with intelligent processing, China has obvious advantages, and the future looks bright.

Industry growth is still necessary in order to catch up with Europe and the US in the field of integrated circuits.

“The ZTE incident has sounded an alarm for China’s domestic chip R&D, and also exposed the differences between China, Europe and the US in high-tech fields such as chip manufacturing,” said Steve Deng. The manufacture of integrated circuits is divided into such processes as designing and manufacturing. It is often that there are billions of transistors on an integrated circuit. The designing of integrated circuits is now totally accomplished through automatic tools, but these mainstream design tools all belong to the US, none of them is owned by China. In some senses, the differences in terms of manufacturing is even bigger. For example, so far, China still cannot make photo-etching machines, which is the core equipment needed for manufacturing integrated circuits. Although the government has given lots of support and input to many projects, it can still be said to be in a relatively primative state.

Steve Deng went to the US to study at the end of the 1990s, earning a doctorate in Electronics and Computer Engineering at Carnegie Mellon University. Steve Deng’s initial research was oriented around integrated circuits and CAD, he later moved on to researching GPGPU, and gradually focused in on the field of machine learning. During his ten years of work in the US, he accumulated a lot of technical and management experience in chip research and industry. Upon returning to China in 2013, Steve Deng acted as an associate research fellow and PhD supervisor at the School of Software at Qinghua University, focusing on research in the fields relating to computer system structures, artificial intelligence and industrial big data.

Regarding the questions asked by many people about China’s potential capacity for manufacturing integrated circuits, Steve Deng notes that China actually has quite a large capacity for producing integrated circuits, but it mainly consists of OME factories or integrated circuit manufacturers. For example, SMIC, domestically the highest performing company, ranks fifth in the world in terms of capacity, and is two or three generations behind Intel in terms of advanced technological processes.

According to reports, at present, the most advanced technology in the world for manufacturing chips is in the hands of American and Taiwanese enterprises, and are divided into two camps. The first camp currently only has Intel in it, Intel’s model is to design its own integrated circuits as well as its own production line, giving the company the ability to control their circuits and manufacturing process, at the same time. Intel has been a world leader since the 1970s. Another camp has TSMC as its representative, an OEM enterprise, manufacturing various chips with common purposes.

More opportunities in the smart chip manufacturing industry

Although it will take a lot of time to catch up and accumulate market share in respect of integrated circuits designing and core technologies, Steve Deng points out that China has a huge demand for chips in such fields as Intelligent IoT (internet of things). Therefore, a chip manufacturing industry that combines sensors and intelligent processing will have more opportunities for development.

“CPU and GPU are still difficult to catch up in. This is because the focus of CPU is on an industry chain, and though China will have no difficulty in independently designing a CPU, it will be difficult to get others use it.” Steve Deng adds that, for example, currently every computer uses an Intel processor, and this processor has an operating system built to support it, but a new CPU will have no operating system to support it and no application software, thus it will be very hard to increase its market share and popularity.

Steve Deng believes that current Chinese economic development puts a huge demand for intelligent terminals. For example, the transmission capacities for high-speed rail, aircraft and intelligent terminals is not very high because there is no wireless network, and the volume of data collected is far more than that of the data transmitted. Therefore, a portion of data can be processed first in intelligent terminals before being transmitted, thus significantly increasing the efficiency of data transmission. As a result, the chips combining sensors and intelligent processing have a bright future, because China has its own demands as well as a dominant advantage in manufacturing.

“In the future, AI chips will command substantial market share. Take intelligent terminals, we can use AI technology to process them. These chips are used to support Intelligent IoT, and China has huge demand for these kinds of chips. If development is concentrated on this, it will be an advantage.” Steve Deng described.

The major role of massivly talented people and good technical culture

“Whether it is about catching up with and developing the ability to design integrated circuits or the technological process of manufacturing, the key lies in talented people.” Steve Deng believes that a good technical culture and philosophy are required to retain and develop professional talents.

Steve Deng sees the US as an example of this, where, some professional technical companies always have a group of senior engineers, whose careers are dedicated to making CPUs, they have done so from the first generation of a CPU, and continue doing so up until they reach the age of fifty or sixty. They have gone through every generation of technology as well as every setback, and their experience is so valuable that it is very hard to replace. Many such technical experts simply love to study technology, and it can be difficult to entice them with high salaries into working for others. Moreover, these professionals are at different positions in the corporate hierarchy, some are responsible for management, some are engaged in technology, and managers are not necessarily higher than engineers, but are still very valuable to their team of engineers.

“It is hard to have such a system in China, where, one will have nothing to do with technology as soon as reaching a certain age, resulting in the lack of experienced senior engineers, and this is a difficulty. It is necessary to cultivate a good technical culture like that in some American tech companies,” said Steve Deng.

However, Steve Deng also indicates that, seen from a near- and long-term perspective, although China cannot be compared to the US in terms of historical accumulation, the talented people in reserve for integrated circuits is relatively high in numbers, and a great number of young talent is trained at universities every year, and this is an advantage.

As for technical breakthroughs and organization, Steve Deng suggests that lessons can be learned from some research institutes in the US, and it is necessary to encourage projects that are small in scale but high in quality, each project is not particularly large but has its own special goals.