SHENZHEN, China — ChangXin Memory (CXMT) has claimed the distinction of being — officially — “China’s only DRAM producer.”

China is boastful of its plan to produce homegrown memory devices, but aside from the NAND flash memory in the works at Yangtze Memory Technologies Co., Ltd. (YMTC) and NOR flash designed by GigaDevice, China has had more ambition than results.

Creating DRAM would be a big step in validating China's semiconductor ambitions, but industry opinion has been split on whether China can deliver DRAM at all. Even if it does, observers ask how soon China can start shipping commercial DRAMs in meaningful volume.

ChangXin claims to be already doing it. Surprise.

ChangXin Memory thusfar completed the R&D and Fab 1. (Source: ChangXin Memory)

In an exclusive interview with EE Times , representatives of ChangXin Memory (formerly known as Innotron Memory) said the company has completed its Fab 1 and R&D facility in Hefei, the capital of Anhui province, and is currently running 20,000 wafers per month. It is scheduled to double its capacity to 40,000 wafers per month in the second quarter of 2020. Using a 19-nm process technology, ChangXin has begun producing this fall LPDDR4, DDR4 8Gbit DRAM products.

Instead of pursuing the commodity DRAM market, ChangXin has chosen to go after the production of mainstream DRAM.

ChangXin’s emergence as a viable DRAM producer in China is noteworthy, given that several indigenous DRAM vendors have seen their business either stall or die. Worse, Tsinghua Unigroup’s original plans for DRAM production in Nanjing and Chengdu, for example, ended up getting exploited to jack up land prices.

Separating ChangXin from China’s other DRAM production attempts is the fact that ChangXin isn’t just talking the talk. It has actually built a fab, (with expansion plans for two more), while simultaneously building infrastructure to house as many as 3,000 employees and their families in Hefei.

Who’s behind ChangXin?

ChangXin is run by Yiming Zhu, GigaDevice’s former president. It was founded in 2016 by Hefei Industrial Investment Fund and GigaDevice. Technically speaking, the company has no DRAM heritage.

ChangXin also has no association with the Tsinghua Unigroup.

China’s entry into the DRAM market has been tough so far largely for two reasons. First, China has little production experience or expertise. Second, China has not accumulated DRAM-related IP of its own.

So, how does ChangXin getting around such foundational challenges?

Of the 3,000 employees at ChangXin, 70 percent are engineers and technical staff, explained Ian Ng, director of business development at ChangXin.

ChangXin acknowledged that it’s been recruiting engineers from Korea and Taiwan to build its fundamental DRAM knowledge. It has also hired technical staff formerly at Qimonda. These recruits include Karl Heinz Kuesters, who signed on as a “consultant.”

ChangXin views Kuesters as ChangXin’s DRAM ace in the hole. He worked at Qimonda/Infineon for 24 years until Nov. 2008. Kusters was vice president of technology and predevelopment at Qimonda.

Qimonda’s bailiwick was “trench capacitor” process technology, now regarded as an outdated DRAM technology. When the industry learned that ChangXin was hiring ex-Qimonda people, the assumption followed that ChangXin was using Qimonda’s old trench technology. ChangXin revealed, however, that it has moved into production using “stack capacitor” process technology.

It turns out that Kuesters was responsible for developing Qimonda’s own stack capacitor process technology while he was still there. Qimonda, however, ran out of money before it could transition to stack capacitor.

ChangXin Memory is using “stack capacitor” process technology, instead of “trench capacitor” technology. (Source: ChangXin Memory)

IP and trade secrets

Hongyu Liu, executive vice president at ChangXin, acknowledged that a tech company, whether it is Qualcomm, Apple, or TSMC, inevitably faces not just IP issues but also the handling of “trade secrets.”

Look no further than Fujian Jinhua. Once viewed as the Chinese DRAM maker with a knack for ramping up yield, Fujian Jinhua today is deemed pretty much “dead.” Fujian Jinhua faced a double whammy, first being accused of stealing trade secrets from Micron, then being put on the entity “blacklist” by the U.S. government.

One memory industry observer based in Silicon Valley, who spoke on condition of anonymity, said, “The operational architecture [of Fujian Jinhua] was pretty smart: Recruit in Taiwan DRAM engineers who don’t want to live in China and then only ship production technology to Jinhua.” He explained, “The only problem is that it recruited too many Micron-Nanya people and some were accused of taking trade-secrets with them. It also doesn’t help that Taiwan is critically dependent on the U.S. for military and political support. So even before the Trump administration, the Taiwan government had complied with a U.S. order to shut down Jinhua Taiwan.”

The nail in the coffin was the U.S. sanctions.

The case, under which the U.S. Commerce Department last year practically banned all exports and technology transfers to Fujian Jinhua, is one of the clearest outcomes yet of Washington’s war on the rise of China’s tech sector. Sanctions by the U.S. and by extension by Taiwan, exacerbated Fujian Jinhua’s shortage of the imported materials to keeping fabrication going.