[News] SMIC Founder Says China May Gain Edge in Niche Chips as 80% of Demand Lies Outside Advanced Nodes

As China pushes to strengthen its chip industry, Richard Chang, founder of SMIC, China’s largest foundry, suggests that success in semiconductors is not solely about winning the 2nm or 3nm race, with niche markets potentially emerging as a key competitive advantage for China. According to STAR Market Daily, Chang said that niche markets have become a key breakthrough point for China’s semiconductor industry, adding that advancing in specialized market segments could help strengthen the country’s overall chip capabilities.

SMIC remains limited to the 7nm node due to its reliance on older DUV lithography equipment. However, Richard Chang’s emphasis on niche markets suggests that the company’s mature-node technologies could still find meaningful opportunities across a range of applications, as noted by Wccftech.

SMIC Founder Highlights Opportunity Beyond Advanced Nodes

As noted by STAR Market Daily, Richard Chang argued that semiconductor success should not be defined solely by achieving 3nm or 2nm nodes, describing such thinking as a misconception and highlighting niche markets as a key opportunity for China’s chip industry.

Chang further noted that advanced nodes account for less than 20% of the global semiconductor market by product volume, while more than 80% of demand comes from mature-node and specialty-process segments. According to Chang, many niche markets still dominated by overseas players could represent key breakthrough opportunities for Chinese semiconductor companies.

The trend may already be emerging across parts of the supply chain. According to TrendForce, with Taiwanese foundries shifting capacity and raising prices, customers in HV processes and CIS applications are increasingly turning to Chinese foundries for more stable pricing and capacity availability. This order migration has been evident since the second half of 2025, driving strong demand for 90 nm-and-above 12-inch wafers among Chinese players.

Beyond Large Models: Richard Chang Highlights Edge AI Potential

In addition, Richard Chang argued that edge AI and scenario-driven applications remain underappreciated opportunities within the broader AI landscape. As STAR Market Daily notes, Chang said sectors such as industrial control, automotive electronics, and wearable devices could create strong demand for application-specific semiconductor solutions, offering startups room to pursue differentiated strategies outside direct competition with global AI giants.

Read more

• [News] SMIC 2026 Action Plan Points to Above-Industry Growth, Capex Held in Line with 2025
• [News] China Reportedly Targets 80% Chip Self-Sufficiency by 2030, Eyes Domestic 7nm Line and 14nm Production Stability
• Capacity Cuts and Surging Demand for AI Power ICs Set Stage for Mature-Node Foundry Price Increases, Says TrendForce

(Photo credit: SMIC)