China’s fledging memory makers are expected to reach a major milestone and move into initial production this year, although vendors are already running into various roadblocks.

China’s domestic vendors are focusing on two markets, 3D NAND and DRAM. In both cases local vendors are either behind in technology, struggling to develop these products, or both. And one vendor recently was hit with a lawsuit over alleged trade theft, renewing fears about the lack of intellectual-property (IP) protection in China.

Still, China is moving full speed ahead in memory as well as IC design, logic and packaging. Armed with billions of dollars in funding, China wants to develop its domestic semiconductor industry because it currently imports the vast majority of its chips from foreign suppliers. That has created an enormous trade gap.

In logic, China has made a tiny dent in the trade gap over the years. And China recently announced several major projects to shrink that gap. Among them:

China’s Tsinghua Unigroup, a state-run electronics giant, recently announced three big memory projects at a cost of $84 billion. The goal is to build nine fabs, but only one fab is actually under construction today. It is focusing on 3D NAND, where it is sampling a 32-layer device with a 64-layer technology in R&D.

Two other Chinese companies, Jinhua Integrated Circuit Co. (JHICC) and Innotron, are separately expected to ramp up 22nm DRAMs in new 300mm fabs. (Innotron is sometimes referred to as Rui-Li.)

It’s unclear if China can get a foothold in the market. Local vendors have some IP, but they are basically starting from scratch. To help propel its efforts, the nation has attempted to acquire multinational memory makers or form alliances. Most have balked, citing national security and IP concerns.

So China must develop most of the technology itself. But it’s difficult to play catch-up in the competitive memory market against the multinationals such as Intel, Micron, Samsung, SK Hynix, Toshiba and Western Digital.

That raises questions about whether China’s memory makers will succeed in the long run. Some analysts are pessimistic, saying that the domestic vendors lack competitive technology. Others are slightly more upbeat about China’s domestic memory efforts.

“We are a bit more optimistic on NAND than we are in DRAM, but it’s going to take some time,” said Handel Jones, chief executive of International Business Strategies (IBS), a market research firm. “(China has the) ability to gain share in NAND, but you still need leadership technology. But for a new DRAM company to come in and gain access to technology, it will be very tough.”

China is roughly six to nine months away from developing a 64-layer 3D NAND device, a technology that could put the nation on the map, according to multiple sources. Volume shipments are still anywhere from one to two years away, so it remains to be seen if China can make reliable parts, sources said.

Others have a different viewpoint on the market. “Semico believes the success of three Chinese-owned memory companies is highly unlikely, but the success of a single Chinese memory company is very probable,” said Joanne Itow, managing director of manufacturing at Semico Research, in a recent blog.

In total, the capacity among China’s domestic memory vendors is projected to increase from nearly zero today to more than 300,000 wafers per month (wpm) by 2021, according to Semico. This may sound impressive, but it will represent less than 10% of the worldwide memory capacity by then, according to Semico.

By: DocMemory
Copyright © 2023 CST, Inc. All Rights Reserved