In 2019, the U.S. Commerce Department blacklisted Huawei and over 70 of its subsidiaries, restricting China’s advancement in advanced chip development.

However, in August 2023, Huawei unexpectedly launched its new flagship smartphone, the Mate 60 Pro, featuring its self-developed 5G chip, hinting at Huawei’s breakthrough in the U.S. 5G chip restriction.

The release of this new smartphone swiftly dominated the high-end smartphone market in China, with Apple being the primary target. As Huawei plans to expand the market share of its high-end flagship series in 2024, targeting the domestic market in China, the product is poised for direct competition with Apple.

The performance of Apple’s smartphones in the Chinese market next year will be a focal point of industry attention.

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(Photo credit: Huawei)

In November 2023, China witnessed a remarkable 1050% surge in the import value of crucial chip manufacturing lithography equipment from the Netherlands, the primary exporter of photolithography equipment, according to the South China Morning Post.

This surge, measured in terms of value, indicates that Chinese semiconductor companies have managed to maintain a channel for ordering advanced equipment despite the tightened export restrictions imposed by the United States

Lithography equipment holds a paramount position among the ten types of equipment essential in the manufacturing process of integrated circuits (ICs).

Reportedly, despite substantial financial investments, China has been acknowledged to lag behind in this technology for many years. Despite allocating significant funds, the country has still struggled to narrow the gap with leading enterprises in this crucial aspect of IC manufacturing.

Meanwhile, in October, the U.S. Department of Commerce expanded its export control regulations on China, with the new provisions taking effect from November 2023.

These regulations specifically restrict the Dutch company ASML from selling certain immersion Deep Ultraviolet (DUV) lithography equipment to Chinese facilities engaged in advanced semiconductor manufacturing. Consequently, China’s import of equipment has seen a consecutive surge for nearly two months.

In November, China imported 16 lithography equipment units from the Netherlands, valued at USD 762.7 Million, marking a tenfold year-on-year increase. By comparison, in October, China imported 21 lithography equipment units valued at USD 672.5 million, with an average price difference of 46% per unit.

In November of this year, China imported a total of 42 lithography equipment, valued at USD 816.8 million, including 15 units from Japan. When combined, the imports from the Netherlands and Japan accounted for almost the entire amount spent by China on lithography equipment in November.

In response to the U.S. restrictions, ASML’s CEO, Peter Wennink, previously stated that these limitations would exclude the vast majority of Chinese customers. This exclusion is due to the fact that these customers are involved in mature or traditional semiconductor manufacturing, specifically in the production of semiconductors at 28nm and above.

Jan-Peter Kleinhans, Senior Researcher and Head of Technology and Geopolitics Projects at the Berlin-based think tank “Stiftung Neue Verantwortung” (New Responsibility Foundation), mentioned that the impact on sales would not be immediate following the new U.S. restrictions.

As per the report from South China Morning Post, this is because ASML has a lead time of approximately 18 months. This implies that the equipment shipped in the fourth quarter of 2023 would have been ordered in the second or third quarter of 2022, and ASML would apply for export licenses at some point thereafter.

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(Photo credit: ASML)

As one of the key cases in the US-China tech war, American memory giant Micron Technology had mend relations with China. Recently, Micron said a global settlement agreement with state-backed competitor Fujian Jinhua Integrated Circuit (JHICC) concerning intellectual property theft lawsuits.

According to Bloomberg’s report, on December 24th, Micron has indicated that it has reached a global settlement agreement with Fujian Jinhua Integrated Circuit. A Micron spokesperson stated in an email, “The two companies will each globally dismiss their complaints against the other party and end all lawsuits between them.” However, no further information or details were provided.

In March of this year, the Cyberspace Administration of China conducted a cybersecurity review of Micron products, and in May, it cited cybersecurity concerns as the reason for prohibiting Chinese operators of “critical infrastructure” from using Micron’s chips.

Micron stated that the Chinese restrictions have affected approximately half of its sales related to Chinese customers. Accordingly, Micron derives about a quarter of its global revenue from China and Hong Kong.

Reportedly, industry insiders believe that following the settlement between the two parties, it is not anticipated to have a significant impact on the upward trend of memory prices.

Appeared to have attempted to pacify Beijing, Micron announced in June an increased investment in China, planning to invest over CNY 4.3 billion in the next few years in its packaging and testing facility located in Xi’an, China.

Micron has decided to acquire the packaging equipment of Powertech Semiconductor (Xi’an), planning to construct new facilities at the Micron Xi’an plant and introduce state-of-the-art and high-performance packaging and testing equipment.

In 2017, Micron filed a lawsuit in the United States against Fujian Jinhua and its Taiwanese partner United Microelectronics Corporation (UMC), accusing these two companies of stealing trade secrets related to Micron’s memory.

A year later, as the U.S. Department of Justice intensified actions against China in economic espionage cases, Fujian Jinhua and UMC were charged with conspiring to steal Micron’s trade secrets. The Trump administration at the time placed Fujian Jinhua on the so-called Entity List, prohibiting U.S. component sales to this Chinese DRAM maker.

In 2021, UMC and Micron announced a settlement. UMC admitted guilt in an agreement with U.S. prosecutors, and the prosecution agreed to drop the charges of economic espionage and conspiracy.

Nevertheless, the case against Fujian Jinhua by the US Department of Justice remains pending.

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(Photo credit: Micron)

In a significant move to regulate online and mobile games, China’s National Press and Publication Administration has issued a draft regarding online game management measures, with the intention of soliciting public opinions.

It is stipulated that online games are prohibited from offering inducement rewards such as daily login bonuses, first-time recharge perks, and consecutive recharge incentives. This directive directly challenges the prevailing business and monetization models in the current landscape of online and mobile gaming.

The regulation further mentions that, game publishers are forbidden from providing or tolerating high-priced transactions of virtual items through speculative or auction formats. All online games must implement user recharge limits, which should be publicly disclosed in their service rules.

For users engaging in irrational consumption behavior, there should be pop-up warning reminders. When providing random draw services, online game publishers must reasonably set the draw frequency and probabilities, avoiding inducing users to overspend.

Additionally, alternative methods such as virtual item exchanges and direct purchases with in-game currency should be offered to users to obtain items with similar functionality and value-added services.

The regulations also emphasize that the online game publishers should announce the termination of publishing or operating the game at least 60 days in advance. Refunds or exchanges should be conducted in legal currency or other methods accepted by users, based on the proportion of user purchases.

The regulations stipulate that online game publishers must have the necessary technical equipment, related servers, and storage equipment located within the territory of China.

(Photo credit: Unsplash)

In response to export restrictions on AI chips by the U.S. Department of Commerce, NVIDIA has previously introduced a China-Exclusive version of its graphics card, featuring the AD102-250 GPU and named GeForce RTX 4090 D.

According to ICsmart’s report, industry insiders has revealed that NVIDIA is rumored to officially unveil GeForce RTX 4090 D on December 28 at 10:00 PM (GMT+8), with the suggested retail price remaining at CNY 12,999.

Due to the impact of the new U.S. export restrictions on semiconductor to China in October this year, NVIDIA’s high-end gaming graphics card, GeForce RTX 4090, faced restrictions in sales in China.

In order to address this issue, NVIDIA decided to develop the customized GeForce RTX 4090 D specifically for the Chinese market. By adjusting certain specifications to comply with U.S. export control requirements, they aim to continue sales in the Chinese market.

According to previous information, the RTX 4090D is still based on TSMC’s 4nm process, featuring the AD102 GPU. However, the core designation changes from AD102-300 to AD102-250, corresponding to a downgrade in specifications. The exact number of CUDA cores is not yet clear, but is expected to be fewer than the 16,384 cores in the RTX 4090.

Additionally, the core base clock will see a slight increase from 2235MHz to 2280MHz, while the boost clock remains at 2520MHz. It is possible that the card will retain 24 GB of GDDR6X memory capacity with over 1 TB/s of bandwidth. The total board power (TBP) is expected to see a slight reduction from 450W to 425W.

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(Photo credit: NVIDIA)