China is increasing its turnover. The fight for the semiconductor market is intensifying
The Chinese semiconductor industry is increasingly looking for alternatives to classic transistor scaling. Instead of subsequent, increasingly difficult to achieve lithography, the so-called advanced layout packaging. According to the latest reports, SMIC has just started a new stage of activities in this area, establishing a specialized research unit in Shanghai.
This is a necessity if China wants to produce AI equipment
The goal of the new organization is to develop backend technologies that will enable the company increase chip performance even without further shrinking transistors. This is a clear signal that SMIC wants to follow the path previously taken by global leaders such as TSMC with CoWoS technology or Intel and its EMIB and Foveros solutions.
Despite billions of dollars in subsidies from the Chinese government and industrial espionage, SMIC still has huge arrears. Not only towards Taiwan, but also towards South Korea and the United States. The company’s portfolio still lacks 2.5D and 3D solutions, which are crucial for HPC processors and AI accelerators today.
According to the report, a new research initiative aims to improve coordination between wafer production and the packaging and testing stages. This may mean increasing collaboration with external OSAT partners, rather than immediately attempting to create a CoWoS equivalent. This is a reasonable approach, because advanced packaging requires not only precise machines and interposers, but also a mature ecosystem of suppliers.
The market shows that the game is worth the candle. Today, production capacity at TSMC is severely limited, and giants such as Apple and NVIDIA are looking for alternatives. For China, which has faced major barriers to further shrinking transistors, advanced packaging is a challenge a real opportunity to improve the competitiveness of domestic systems. Of course, as long as the yield is improved, which looks poor without ASML machines.
