China in recent years has been ramping up efforts to develop core technologies in the domestic chip industry, in an aim to cut its strong reliance on other countries and regions, and that pace was further accelerated in April following the U.S.' ban on component sales to Chinese telecom company ZTE Corp.
The most recent move taken by the Chinese government to bulk up the country's chip-making muscles includes the establishment of a new fund worth more than billion, run by the National Integrated Circuitry Industry Investment Fund Co, the Wall Street Journal reported on Monday.
Meanwhile, Chinese technology giant Alibaba Group Holding said in an announcement it sent to the Global Times that in April it acquired Hangzhou-based C-Sky Microsystems, a manufacturer of embedded chips, an important move in its chip development efforts.
In 2017, the conglomerate also said it would strengthen its technology research input, in an aim to invest more than billion in R&D in the following three years.
Alibaba also set up a global research program in 2017 named DAMO Academy to seek global technological cooperation.
On May 3, Chinese tech companies Lenovo Group, Dawning Information Industry Co (also known as Sugon) and iFlytek also displayed new AI products at a product launch conference held by AI chip start-up Cambricon Technologies Corp.
During the conference, Lenovo released its first server platform equipped with Chinese-designed Cambricon chip-powered MLU100 intelligent processing cards.
Those efforts seem to have paid off. Data released by China's Ministry of Industry and Information Technology (MIIT) showed that in the first quarter of 2018, the value of China's electronic information manufacturing industry grew by 12.5 percent compared with the same period in 2017, faster than the growth rate of all above-scale industries by 6.7 percentage points.
The volume of integrated circuits produced in the first quarter of 2018 reached 39.99 billion, up 15.2 percent compared with 2016's figure, said the MIIT.
Despite the rapid growth, it is widely believed that due to the time-consuming, slow and costly nature of chip development, China now lags behind the West in most chip-making processes and is unlikely to catch up in the short term.
Japanese financial news outlet the Nikkei Asian Review on May 1 reported that British chipmaker Arm Holdings will cede control of its Chinese operations in a new joint venture (JV) named Arm Mini China, with China set to hold a majority stake of 51 percent.
On Tuesday, Arm confirmed the news to the Global Times via email, stating the new JV has already begun operation, and that it will provide extensive technology support for its Chinese partners throughout the new venture.
Arm will also help localize technology to satisfy the demand in the Chinese market.
"Arm dominates in designing one of the key chip technologies, which others are unlikely to catch up with," a graduate research assistant at Duke University's Department of Electrical and Computer Engineering, who only gave his surname as Yang, told the Global Times on Tuesday.
Major tech multinationals including Apple Inc, Samsung Electronics, Huawei Technologies, Qualcomm, Broadcom and MediaTek all need to license technology from Arm, one of the most influential chip technology providers in the world, to develop chipsets for their smartphones, tablets, wearables and various other connected devices.
"It's possible that domestic chip designers may benefit from the technology transfer, however, the chip-making process is too complicated; designing is just one part of the whole process," Yang said.
Geng Bo, vice secretary-general of the China Solid State Lighting Alliance, agreed with Yang, admitting that it is of course good news for the Chinese chip industry, but that it's too soon to say if the industry will definitely improve just because of the advancement of one specific technology.