The threat to Intel will be in the CPU field, which will be the second longest market share for AMD. Since the "blowout" quarterly earnings report was released at the end of April, AMD's share price has risen more than 41%. AMD President and CEO Lisa Su even rumors in the recent JPMorgan event that AMD’s processor share will reach 40% in the next few years.
In fact, since Fairchild's (Fairchild, also known as "Fairchild") company split up, Intel and AMD are just like a soap opera, both honeymoon and righteous, but it is also the love of the past half century. Killing each other drives the flourishing development of the CPU industry and even the semiconductor industry.
The "traitors" in Silicon Valley
In the history of the semiconductor industry, William Shockley, the "father of transistors," had a term that was thought to represent the spirit of Silicon Valley-"eight traitors".
Shockley once started a company, but eight employees, including Robert Noyce and Gordon Moore, eventually signed off on a dollar bill because the team was at odds. This was the origin of the eight traitors, who later founded another legendary company, Fairy Boy, in 1957.
One named Donald C. Hoefler's American journalist, who wrote a series of reports called "Silicon Valley of the United States" in 1971, analyzed in his manuscript that almost all semiconductor companies in Silicon Valley originated from Fairchild. It is also Hoefler's manuscript that was awarded the title of “Silicon Valley” for the first time in Santa Clara Valley, California.
It can be said that companies in Silicon Valley have more or less origins with Fairchild. There have been reports that at the 1969 semiconductor summit in Silicon Valley, only 24 of the more than 400 attendees were not Fairchild’s former employees, which is enough to demonstrate Fairchild’s position in the history of semiconductors.
With the semiconductor industry in the Silicon Valley booming, Fairchild has been developing semiconductor talents while the talented people are constantly leaving and have established their own companies. Intel and AMD are the representatives of the "traitors" to set up the company.
In 1968, Robert Noyce and Gordon Moore of the eight traitors founded Intel, while Jerry Sanders, also a fairy, founded the AMD in 1969.
But compared with Intel, AMD's birth seems to be a lot worse, Neuss is known as the "Father of Integrated Circuits", Moore is the proponent of "Moore's Law", and Saunders is just Fairchild responsible for sales of high tube. This origin led to Intel’s technology-oriented development, while AMD was market-oriented.
In the eyes of people in the industry, the development of technology leads to obvious advantages of Intel. In an interview with reporters from the 21st Century Business Herald, Yu Yingying, a member of the China-US Semiconductor Industry Association, pointed out that since the 1960s, Intel has promoted Moore's Law over the past 50 years and has driven the development of the entire industry chain. Leading role.
In fact, at the beginning of its establishment, Intel's success mainly relied on memory chips. In 1970, Intel introduced the first dynamic random access memory (DRAM) chip C1103, and achieved annual revenue of more than 23 million US dollars in two years. By 1974, Intel’s market share in global DRAM reached 82.9%.
The success of DRAM helped Intel to go public in 1971. In the same year, Intel developed the first commercial microprocessor 4004. But in the meantime, memory chips are still Intel’s main revenue source.
With the rise of the semiconductor industry in countries such as Japan, Intel’s market share in the memory sector has been declining, and by 1984 it has dropped to 1.4% of the global DRAM market share. During this period, Intel’s processor business began to shine, and the 8080 processor produced by Intel in 1974 laid the foundation for the future glory of the X86 architecture processor for 30 years.
In 1982, Intel chose to cooperate with AMD in order to win IBM's mass production orders for personal computers. After getting Intel's authorization, AMD became the second supplier of 8086 and 8088 chips, and thus created a clone of the 80286 processor. " Am286”.
This period was once regarded as the "honeymoon period" of the two processor giants. However, following Intel’s tearing up of the licensing agreement with AMD in 1986, AMD chose to compete with Intel. AMD prosecuted Intel for breach of contract and monopoly market, and Intel counterclaimed AMD on the ground of infringement. The two companies fell into legal battles in the following eight years. Although AMD finally won, it was technically far behind.
The story reversal: catch up and be overtaken
It seems that the story should be put to a full stop after the court, but the story is like a soap opera.
Intel’s technological advantages have allowed companies such as WinChip and Cyrix to lose market share, while AMD has survived. In 1995, AMD acquired the troubled CPU design company NexGen and successfully launched the K6 series. The introduction of the K7 (later changed its name to Athlon, "Athlon") made AMD's limelight over Intel. Athlon's high-speed FSB and high-performance performance made AMD occupy a certain market share. Being able to "overclock" also made AMD gain faithfulness. user.
By 2003, AMD proposed the 64-bit concept and introduced Athlon 64. At the time, 64-bit processors were only used for high-endserverIn products, although Intel claims that 64-bit processors will take a few years to launch, the company still launched a 64-bit processor a year later.
At that time, people in the industry generally believed that Athlon processors could swallow most of Intel’s market share. Market research firm Mercury Research's data shows that in 2006, AMD's share of the processor market has reached 22%. Beyond seems to be just around the corner.
However, in July 2006, Intel introduced the Core 2 processor, claiming to be able to reduce power consumption by 40% while increasing its performance by 40%. After the launch of the product, the price of the Athlon 64 X2, which is relatively backward, plunged, and the single-processor dropped more than a thousand dollars overnight. With the promotion of "Moore's Law", Intel will lead the way for more than a decade, and AMD's market share will continue to be compressed, even to 8% of the market in the fourth quarter of 2016.
It is worth pointing out that before the 1980s, semiconductor manufacturing companies were almost all vertically integrated (IDM) companies. By the 1990s, Fabless and design began to rise, followed by foundry and Fab-Lite (light-crystals). Round factory) follow. In this process, Intel has not abandoned the IDM model.
Lu Yingying believes that Intel has its own exclusive products, and the combination of design and production will form a unique competitive power. However, there are certain drawbacks to this model. If there are problems with designing or producing, the risk is still relatively large. However, Intel’s ability to execute is relatively strong and it can be transformed into a very strong competitive force under the control of risk.
Lin Jianhong, a research manager of Jibang Consulting's Tuobai Industrial Research Institute, pointed out that the 1995 CPU and DRAM and NAND Flash products that are now seen are the embodiment of the advantages of the IDM model. When the sales scale of products is still growing at a high speed, the IDM model is actually There is also good growth momentum.
However, if the economies of scale of products are saturated, the IDM model will continue to grow and will face great challenges. Lin Jianhong said that Intel also uses Foundry and non-violate memory as a breakthrough point for growth.
The semiconductor industry under the development of "Moore's Law" seems to be falling into a bottleneck. Intel originally planned to mass-produce 10nm processors by the end of 2017, but it will repeatedly skip tickets and delay the mass production schedule again in 2018 to 2019. At the same time, AMD announced that the 7nm Zen 2 processor will be available in 2019.
Although Intel’s current CEO, Ke Zaiqi, stated at the 2018 shareholders’ meeting that he is not worried about AMD’s technological advancement, the 14nm process still has advantages in 2019. In addition, Intel is also developing other chip business. However, the "APU" (Accelerated Processor) represented by AMD's AMD Ryzen achieves deep integration of CPU and GPU, and breaks through the development path of the processor.
Mercury Research data shows that AMD’s market share has risen to 12% in the fourth quarter of 2017. Su Zifeng also said that in 2018, AMD could occupy about 20% of the desktop processor and 18% of mobile processors. She also pointed out that AMD’s market share could double in the next few years to 40%.
It seems that in the field of processors, the catch-up and catch-up will be staged again.
Although the U.S. semiconductor industry has a major advantage that cannot be duplicated in other regions. The IC industry was born in the U.S., and major technological breakthroughs and changes in the industry began in the U.S., but the U.S. gains and losses in the ecosystem of science and technology industry, the role of government policies, and personnel training. Still worth exploring.
In the first three global commercial observations, we sorted out the current competitive landscape of the international semiconductor industry, analyzed the history, status quo, and gains and losses of the development of the semiconductor industry in South Korea, China, Taiwan, and Europe. This issue of Global Business Watch focuses on the semiconductor industry in the United States. It analyzes why the birthplace of the semiconductor industry can maintain the evergreen industry for more than half a century. It has always maintained the world's leading support logic and password. At the same time, they also have a glimpse of the famous "traitor" culture in Silicon Valley and the love-hate stories of the two semiconductor giants Intel and AMD. (Li Yanxia)
A recent survey report from market research firm Strategy Analytics shows that in 2017, in the global baseband chip and smart phone application processor market, US semiconductor company Qualcomm accounted for 53% and 42% of the market share respectively, and continued to solidify the field. Dominance. Strategy Analytics believes that Qualcomm will continue to maintain its leading position in the market in 2019 and beyond in the transition from 4G to 5G.
The strength of Qualcomm is just one example of the leading position of the US semiconductor industry. IC Insights, a semiconductor industry research organization, updated its data in May. According to revenue, the United States holds 8 seats among the world’s top 15 semiconductor manufacturers (including wafer foundries) in the first quarter of 2018. In 2017, North American semiconductor manufacturers together accounted for 49% of the global semiconductor market.
In addition, unlike companies in other regions that focus on subdivided areas or foundry businesses, American manufacturers can produce almost all types of semiconductor products, and have a complete layout of equipment and materials. Of the top ten global semiconductor equipment vendors announced by VLSI in 2016, four US companies, Applied Materials, Lam Research, KLA-Tencor, and Teradyne, ranked first, third, fifth, and eighth respectively.
Although the US semiconductor industry has a major advantage that cannot be duplicated in other regions. The IC industry was born in the United States. Important technological breakthroughs and changes in the industry have mostly started in the United States, but the United States has played a role in the ecology of science and technology industry, the role of government policies, and personnel training. The gains and losses are still worth exploring.
The rise of Silicon Valley and IC industry
When asked about the success factors of the US integrated circuit industry, a U.S. semiconductor practitioner was somewhat confused: ICs were born in the United States, which made it difficult to pinpoint the “most important reason” for their success.
The director of the CASPA, Yu Yingying, told 21st Century Business Herald that the integrated circuit industry started in the United States and with the simultaneous development of the US economy after the Second World War, the success factors of the US semiconductor industry need to be grasped from the whole.
In 1947, William Shockley, the “Father of Transistors”, and two colleagues at Bell Labs created the first transistor, and the three shared the 1956 Nobel Prize in physics. Afterwards, Shockley left Bell Labs and set up the Shockley Lab in Silicon Valley today. Among the talented people who had come to defect to Shockley, there were then eight co-founders of Fairchild.
In 1957, eight people left to create Fairchild Semiconductor Corporation, and they were therefore yelled by Shockley as "eight traitors." But soon, this name became the legend of Silicon Valley and even the US technology industry. The "rebellious" entrepreneurial spirit has affected generations of Silicon Valley entrepreneurs and scientists.
In 1958, Texas Instruments’ Jack Kilby made the first integrated circuit, but his device failed to find suitable silicon crystals. Fairchild soon achieved a breakthrough. Robert Noyce, one of the "eight traitors," filed a patent application for the manufacture of integrated circuits using silicon planar technology in 1959, and produced the first in March 1961. A silicon-based integrated circuit. The IC industry officially kicked off.
In 1968, Gordon Moore and Neuss, who finally left Fairchild in the “eight renegades,” also independently founded Intel, the world’s most successful semiconductor company.
In 1971, Electronic News reporter Don Hoefler first published a series of reports on the San Francisco Bay Area computer chip company under the title "Silicon Valley." Silicon Valley gained its name. The word "silicon" is derived from the silicon raw materials used in the integrated circuit industry in the region.
Economic and technological advantages support
Chris Taylor, director of market research firm Strategy Analytics RF and Wireless Component Services, pointed out to 21st Century Business Herald reporter that the strong economic foundation of the United States is one of the core advantages of its semiconductor industry. The U.S. economy achieved strong growth in the 19th and 20th centuries, stimulating investment in the technology industry while expanding employment.
Apple is one of the world's top 10 tech companies, according to the recent Mary Mickle Internet Trends report for 2018, according to market value.Amazon,MicrosoftSeven U.S. companies, including Google, Facebook, Netflix, and eBay+PayPal. This provides the US semiconductor industry with a complete ecosystem including terminal applications, brands and software.
Lin Jianhong, a research manager at Jibang Consulting and Industrial Research Institute, pointed out to 21st Century Business Herald reporter that the long-term accumulation of basic science and technology is one of the main factors that have ensured that the US semiconductor industry has long occupied a leading position.
"Microsoft and Intel occupy the PC market. Google's Android and Apple's iOS lead the smart phone. On the manufacturing side, there are Intel and some powerful scientific research units that are driving the equipment and materials manufacturers, while the external funds are supporting. Innovative environment," he said.
The Governor of the China-Canada Semiconductor Association (CASPA), Mou Yingying also pointed out that many of the pioneers of the early development of the semiconductor industry in the United States were European immigrants of the first generation. "After World War II, many very good scientists came to the United States to look for opportunities." She said. "Father of transistors" Shockley was born in the United Kingdom and later moved to California.
According to Lin Jianhong, the semiconductor industry is only a part of the science and technology industry. The United States has a sound scientific research and innovation system and attracts talents from all over the world. This is crucial for maintaining the leading position in the scientific research field.
Active government intervention: R&D support, policy guidelines
In the early days of the growth of the integrated circuit industry, the U.S. government has played an important role in it. As early as World War II, the US military had a tradition of providing funds for scientific research for the R&D of aircraft, radar, and nuclear industries.
"The National Science Foundation (NSF) provides approximately $7 billion in support each year to support basic physical sciences and mathematics research in universities. The National Institutes of Health (NIH) funds basic medical research. The Defense Advanced Research Projects Agency (DARPA) ) It provides support for companies with military potential research, such as computer network and internet projects.” Taylor pointed out three institutions that have played an important role in supporting the semiconductor industry infrastructure.
Yuying pointed out that the U.S. government’s most direct promotion of the semiconductor industry, in addition to providing financial support for R&D, also played an important role as a buyer. National defense and aerospace research provided a huge market and application scenario for the semiconductor industry.
Professor John Orton, a University of Nottingham professor, also pointed out in his book that during most of the time when the transistor was born, the industry survived with the support of the military, laying the foundation for the future IC industry.
With regard to policy guidelines, the U.S. government has only taken a number of actions in recent years. In 2015, the United States launched the Congress Semiconductor Seminar to specifically study semiconductor industry policies. Subsequently, the U.S. Congress Research Service Center and the Presidential Technology Advisory Committee issued two guiding reports on "U.S. Semiconductor Manufacturing: Industry Trends, International Competition, and Federal Policy" and "Continuously Consolidating the U.S. Semiconductor Industry Leadership Position" in 2016 and 2017, respectively. .
Sravan Kundojjala, deputy director of Strategy Analytics' mobile phone component technology research service, told 21st Century Business Herald reporter that the semiconductor industry has now become an industry that the US government has “closely protected”. “In recent years, the U.S. government has blocked many attempts by foreign investors to buy. The U.S. government regards 5G and AI as the core areas of the semiconductor industry and hopes to maintain its leading position.”
In March 2018, CFIUS also urgently required Qualcom to postpone the shareholders' meeting before the Qualcomm shareholders meeting to intervene Broadcom’s hostile takeover of Qualcomm. A subsequent CFIUS letter showed that it was worried that the acquisition would weaken Qualcomm, thus making Qualcomm lose its advantage at the crucial moment of the 5G standard setting.
"However, almost all of the US semiconductor companies are currently in the global layout, and more importantly, they also have business contacts with China." Kundojjala said, "Most of the U.S. company's success depends more on successful products and marketing strategy."
Frequent flow of talent, industry blossoms everywhere
Recalling the history of semiconductor companies in the United States, an interesting finding is that emerging companies are often able to rise rapidly and promote the progress of the semiconductor industry in the field of technology. In John Orton's view, this is linked to another major feature of the US technology industry: talent flows frequently between different companies.
A survey released by the public welfare organization Endeavor in 2014 showed that as many as 92 U.S. stocks listed on the company, including Apple, Google, Oracle, Facebook, and Tesla, are currently the most popular. The technology companies also include important semiconductor manufacturers such as Intel, AMD, Applied Materials, SanDisk, Nvidia, and Xilinx, as well as semiconductor equipment companies such as KLA-Tencor and Lam Research. Endeavor said that if it goes beyond the limits of listed companies, there are as many as 2,000 companies that can be traced back to the Eight Fairchild Co-founders.
Orton believes that the story of the "eight renegades" determines a culture in which thousands of imitators ensure that professional knowledge and technology can rapidly spread in the industry. This is very different from the relatively stable environment in Europe and Japan.
Emerging companies promote technological innovation is an important manifestation of the vitality of the United States semiconductor industry, this feature has been passed down. In the 80s and 90s of the 20th century, another group of emerging US manufacturers took advantage of the rise of the Fabless model and the advent of the information age (the emergence of the Internet and mobile networks), and in the rapid rise of the United States, they opened up new territories for the US semiconductor industry. And English Weida is one of the most typical representatives.
“For us, the Fabless model has proved to be very successful.” A spokesman for Qualcomm said in an interview with a 21st Century Business Herald reporter on June 1. “This allows us to not invest in equipment, etc. Flexibly focus on a more core, basic R&D level, and let manufacturers who are more willing and good at chip production engage in production.”
Today, U.S. manufacturers are still at the forefront of such emerging technologies as 5G, AI, and Internet of Things. Kundojjala believes that many US semiconductor manufacturers, including Intel, Qualcomm, Nvidia, Broadcom, Micron, AMD, and Xilinx, are actively planning for this round of opportunities.
"For example, Nvidia's GPU vendor has restructured its business model mainly for individual customers into areas such as AI, autopilot and data center." He said, "Qualcomm's leader in the baseband market is also Efforts are being made to extend its success on 4G to 5G and to invest in AI, VR and AR related technologies."
"5G is opening a door for all other related industries," said a Qualcomm spokesperson. "In the past, mobile operators, mobile phone manufacturers, and semiconductor vendors have defined 3G and 4G capabilities. 5G requires many industries." Get involved, inform us about their needs, and define 5G capabilities together.”
However, although the United States is the closest country in the world with a full semiconductor industry chain, US companies are still absent in the field of lithography, and the main DRAM production plants are not in the United States. "There is no single country with a complete supply chain." Lin Jianhong said, "The semiconductor industry has a high degree of professional division of labor, but it has highly centralized characteristics in all subsystems."
In Taylor’s view, the talent pool is an important factor for the U.S. semiconductor industry to maintain its leading position. In particular, the United States emphasizes education in basic science, technology, engineering, and mathematics. However, Yingying pointed out that the United States currently faces a challenge at the talent level: compared to the semiconductor industry with a long training cycle, emerging fields such as the Internet and software seem to be more attractive both in terms of personnel training cycles and income levels. force.