The semiconductor business in China is abuzz over the huge chunk of money China’s central and local governments are about to plunk down on the domestic chip industry.
The combined investments over the next 10 years range from $20 billion to $200 billion, according to the word on the Chinese street. The story has countless versions, each with a different sum of money, leading skeptics to wonder if all the talk is just a matter of Chinese bravado, if not an urban legend.
But based on EE Times interviews with a dozen insiders — ranging from entrepreneurs and investors to the CEOs of fabless chip companies in Shanghai and Shenzhen and well established industry officials in Beijing — the government commitment to the semiconductor industry appears to be real. The planned investment, combining contributions from the central and local governments, is likely to be $10 billion to $15 billion per year, starting in 2015. Some say it might be stretched over 10 years, others say five.
Among variations on the story, there’s one common element on which everyone seems to agree.
The new investment in China’s semiconductor industry will be distinctly different from Beijing’s top-down order in 2000 to “encourage the development of the IC industry in China.”
Known as Policy No. 18, the 2000 directive reportedly launched a network of state-owned technology incubation centers throughout China. The policy had some positive effects, but never really succeeded in generating a star semiconductor company able to compete with counterparts in the West.
