Chip industry food chain: Huawei and Qualcomm are at the bottom, and TSMC is the second from the bottom

In 2004, Huawei HiSilicon was established to focus on the research and development of various chips required by Huawei.
However, it was not until 2009 that the first mobile phone chip K3 was launched. However, this chip performed very poorly. Huawei HiSilicon iterated dozens of times later. Until the launch of the Kirin 970 in 2017, it really had the ability to compete with Qualcomm, Samsung and MediaTek.
Thanks to Kirin chip, Huawei’s mobile phone business reached its peak in the second quarter of 2020, surpassing Samsung for the first time in history and ranking the first in the world.
However, later on, everyone also knew that because of the ban, Huawei’s mobile phones fell rapidly in just one year, and its glory was forced to sell. At present, Huawei’s sales volume is only about 2% in the world, almost ranking 9th and 10th. There is not much sense of existence.
Why? The reason behind this is that Huawei Kirin chips can’t be produced, and Qualcomm can’t sell 5G chips to Huawei. Huawei can only use 4G chips and launch 4G mobile phones. In the 5G era, 4G mobile phones can be sold well. Just think about it.
Chip industry food chain: Huawei and Qualcomm are at the bottom, and TSMC is the second from the bottom
So why do chip companies all over the world call for the US ban? The reason is that behind Huawei’s global strategy, there is a chip food chain with high threshold.
In this chip food chain, Huawei should be at the bottom. There are N links that can block the neck of Huawei’s Kirin chip. Of course, Qualcomm and MediaTek are the same as Huawei. They are at the bottom.
On top of Huawei Kirin, Qualcomm Xiaolong and other chips are TSMC. Huawei and Qualcomm only design chips, and they have to be handed over to TSMC for manufacturing. If TSMC does not manufacture chips, Huawei chips will become the swan song.
Chip industry food chain: Huawei and Qualcomm are at the bottom, and TSMC is the second from the bottom
But in fact, TSMC is only the second from the bottom, because there is another company called ASML (Asme) on TSMC. To manufacture advanced chips, TSMC must purchase EUV lithography machines from ASML. Only ASML can produce it in the world, which is stuck in the neck of TSMC.
But do you think ASML is the top of the food chain? No, there is another company on ASML, called ZEISS, which is stuck in the neck of ASML.
The manufacturing of EUV lithography machine requires extremely precise optical lens. At present, only ZEISS can do it in the world.
In addition, behind the EUV lithography machine, there are Cymer of the United States and TRUMPF of Germany. However, these two companies are not as powerful as ZEISS. There are still some companies that can be replaced.
Chip industry food chain: Huawei and Qualcomm are at the bottom, and TSMC is the second from the bottom
In fact, ZEISS, Cymer and TRUMPF are all controlled by the United States. As a system integrator, ASML needs the cooperation of the global supplier chain, especially ZEISS.
As soon as the US ban is issued, as soon as ZEISS is the top enterprise in the chip food chain, ASML must be obedient, and then TSMC must be obedient, so Huawei, the lowest design company, cannot escape the fate of being banned.
To change life against the weather, we need to take the food chain of the whole chip industry into our own hands or rebuild an alternative food chain.
Chip industry food chain: Huawei and Qualcomm are at the bottom, and TSMC is the second from the bottom
So as Ren Zhengfei said, chips can not only cost money, but also mathematicians, physicists and chemists… because chips are not just chips, they involve a whole high-tech food chain, involving many fields.