China-based cloud service providers and server vendors are keenly developing ASIC chips solutions on their own, particularly those for 5G base stations and servers, providing new business opportunities for Taiwan-based ASIC designers offering technical support and design services for Chinese clients, according to industry sources.
Such high-priced solutions are fabricated on advanced process nodes. ASIC designers winning orders from Chinese clients can significantly boost their revenues and profits at least for two years as they rake in handsome NRD (non-recurring engineering) fees in the first year and benefit from turnkey business in the second year, the sources said.
Many Taiwanese IC design houses including Global Unichip, Alchip, MediaTek, Phison Electronics and RDC Semiconductor are expected to see ASIC orders from China double in 2020 from 2019 as the country's campaign to reduce reliance on US suppliers of crucial IC components and build semiconductor self-sufficiency has prompted Chinese vendors to source more chips solutions or technical resources from Taiwan's IC design firms, the sources continued.
At the moment, Chinese chipmakers or system vendors are focusing their in-house development on new-generation and high-end chips solutions with ASP of over US$100, including AI chips, HPC chips, and CPU, GPU and NPU platforms for terminal devices, as well as core 5G base station CPUs valued at US$300 per unit and server computing chips over US$ 600.
Actually, the development of high-end chips solutions is being carried out with support of diverse semiconductor resources from Taiwan, significantly benefitting TSMC, design service firms and backend houses, the sources said.
Article translated by Willis Ke
