Monday, December 19, 2022
The new lead of China’s Yangtze Memory Technologies Co. (YMTC) over larger rivals like Samsung and Micron with the world’s first 200-layer–plus 3D NAND flash is likely to crumble, according to industry analysts.
Startup memory maker YMTC has leapt past the competition, according to a report by research firm TechInsights. That would fulfill a prediction that the company’s former acting chairman made two years ago to EE Times.
The company isn’t likely to keep the lead, analysts said.
Just two years after its founding in 2016, YMTC announced its Xtacking technology, under which periphery circuits that handle data I/O, as well as memory cell operations, are processed on one silicon wafer. The completed array wafer is then connected through billions of metal vias, with another wafer containing memory cells.
YMTC’s costly technology lead has made profitability for the company less attainable and increased the need to rely on the support of the Chinese government, according to Jim Handy, an analyst with Objective Analysis.
“I have always wondered how something built on two wafers can compete against something with the same die size built on a single wafer,” Handy told EE Times. “Given that YMTC doesn’t need to be profitable, that may work for a while.”
YMTC will likely keep receiving subsidies from the Chinese government as one of the champions of the domestic semiconductor industry, he added.
It will be almost impossible for YMTC to maintain its pace, according to TechInsights analysts in their report: “R&D costs at the leading edge aren’t linear; as technology progresses, R&D costs go up by many multiples to get to the next generation. YMTC isn’t generating enough revenue to support the ever-increasing costs of development.”
The Chinese company will also face patent disputes and sanctions amid a tech war with the U.S. that’s limiting YMTC’s access to advanced semiconductor tools, significantly hampering the company’s progress, the analysts said.
“I anticipate a patent law faceoff sometime between the U.S. and China,” Handy said. “Another challenge YMTC faces is that they must prevent their chips from getting into the U.S. in order to avoid patent lawsuits. Patent law regulates companies that ‘make, use or sell’ products that violate a patent, so a YMTC customer that sells a system in the U.S. that uses a violating chip could be hit with a patent lawsuit.”
YMTC and its rivals are competing for a chunk of the $55 billion 3D NAND market, according to Handy. The smartphones that are assembled in China are one of the main products that use NAND flash. China, which has the world’s largest smartphone market, also assembles the phones for Apple and Samsung.
More than two years ago, the U.S. government sanctioned Chinese electronics champions Huawei and Semiconductor Manufacturing International Corp. (SMIC) to blunt the nation’s lead in 5G and AI on national security concerns. That has touched off a new competition between the U.S. and China to build separate semiconductor supply chains. The U.S. still dominates in chip production equipment, materials and EDA tools, and it has used those advantages to limit China’s growth in semiconductors.
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