Behind ZTE's Prohibition: Reflections on Semiconductor Globalization and Autonomy

After the Anglo-American law cracked down on Syria precisely in the weekend, the United Kingdom and the United States launched a round of precision “blow” against Chinese high-tech companies. ZTE became the first target. The United States bans the sale of any electronic technology or communication components from China’s enterprises to China's ZTE. This approach has brought a strong signal: The guns are aimed at high-tech companies in China. We should realize that China is still subject to restrictions on many key technology nodes. .

The first downfall in the trade war between China and the United States may be the domestic telecommunications company ZTE.

According to Reuters and other foreign media sources, the U.S. Department of Commerce announced on April 16 that it will ban U.S. companies from selling any electronic technology or communication components to Chinese telecommunications equipment manufacturer ZTE. This ban lasts for 7 years until 2025. On the 13th.

The U.S. Department of Commerce stated that the ban was caused by ZTE's violation of the agreement reached with the U.S. government after it was found to have violated U.S. sanctions against Iran.

To make matters worse, the National Cyber ​​Security Center (NCSC) recently issued new proposals to warn the telecommunications industry not to use ZTE's equipment and services.

The United Kingdom, the United States, France and France have just hit Syria precisely. Now under the precise strike of the United Kingdom and the United States, ZTE’s mobile phone business and the AI ​​road may be cut off.

Under the background of the poor trade situation between China and the United States, every action of domestic technology companies in the US market is like walking on thin ice. Although this time it took Zhongxing to attack, but guns are aimed at Huawei and other high-tech enterprises. We should realize that China still suffers from many key technological nodes. Model innovation has come to an end. State-to-state competition is not based on who has the point of selling out. Ultimately, it depends on hard technology and hard power!

ZTE Crisis: Upstream electronic technology and communication components have been banned and previously paid $890 million in fines

The sudden and inevitable crisis of ZTE is also inevitable.

Last year, ZTE pleaded guilty in a federal court in the United States and admitted that it violated US sanctions against Iran and illegally delivered US goods and technology to Iran. At that time, ZTE and the U.S. government reached a settlement agreement.

According to the settlement agreement, ZTE paid US$890 million in fines to the U.S. government in March 2017 and was also facing additional penalties of 300 million U.S. dollars. As a condition of guilty pleas, ZTE agreed to dismiss 4 senior managers and punish 35 other persons.

However, a senior U.S. Department of Commerce official said on Monday that ZTE’s relevant penalties have not been implemented. ZTE only fired four senior managers and did not discipline or reduce bonuses for the other 35 employees.

As a result, the U.S. side decided that it would no longer be possible to trust ZTE’s commitments and issue a ban.

In the past two years, ZTE has successively encountered "battles against the wall" in the United States. There have been many crises, but this is ZTE's biggest crisis in the United States.

To make matters worse for ZTE, the United States’ loyal ally Britain has also joined a series of precision pressures against ZTE – the National Cyber ​​Security Center (NCSC) in the UK has issued new proposals to warn the telecommunications industry not to use ZTE’s equipment and services.

The double blows of the United States and Britain may have caused this old leading telecommunications company in China to suffer catastrophe. ZTE H-shares and A-shares will be suspended from trading this time and issued a circular saying that ZTE has been informed of the US Department of Commerce’s refusal to activate the company. The company is fully evaluating the possible impact of this event on the company and actively communicating with and responding to various aspects.

In response to the U.S. Department of Commerce’s ban on ZTE, a spokesperson for the Chinese Ministry of Commerce stated that the Chinese side noticed that the U.S. Department of Commerce has announced measures to implement export controls on ZTE Corporation.

China has always required Chinese enterprises to abide by the laws and policies of the host country in the course of overseas operations and to conduct business in a lawful and compliant manner. ZTE Corporation has conducted extensive trade and investment cooperation with hundreds of U.S. companies and contributed tens of thousands of jobs to the United States. It is hoped that the United States will properly handle the matter in accordance with regulations, and create a just, fair and stable legal and policy environment for the enterprise.

The Ministry of Commerce will pay close attention to the progress of the situation and stand ready to take necessary measures to safeguard the legitimate rights and interests of Chinese companies.

The supply chain of ZTE is cut off, the road of AI may be cut off, and Huawei, etc

The U.S. Department of Commerce’s ban on ZTE was a huge blow to ZTE.

Qualcomm, Intel, Microsoft, and Dolby are all major suppliers of ZTE equipment. Without Qualcomm's mobile processor platform, ZTE will have difficulty producing handsets in the United States. ZTE plans to launch Axon9 handsets in the US will be affected. The handset uses the Qualcomm Snapdragon 845 chip.

AndroidAuthority estimates that 25% to 30% of components in ZTE's equipment come from the United States. It takes time to find new suppliers for these components, and ZTE could hardly sell anything before that. According to Fang Jing, an analyst at China Merchants Securities in the electronics industry, ZTE needs high-speed AD/DA, modulators, high-performance phase-locked loops, and mid-range VGA products, but no domestic chip makers can provide alternatives.

In addition, although ZTE has gradually disappeared in the domestic mobile phone market in recent years, in order to avoid the status of pipelines, ZTE has quietly laid out artificial intelligence since 2015, and the demand for intelligent networks for next-generation networks is becoming stronger and stronger.

According to a ZTE study released by Guosen Securities in September last year, ZTE has a “platform+cloud-based overall layout to help operators master network intelligence.” ZTE’s artificial intelligence platform is based on containerized high-performance clusters built on NVIDIA GPUs.” Chips and terminals: With intelligent robot brain, smart phone optimization, home smart terminals (including the latest IPTV) and other product capabilities. ”

Whether it is the mobile terminal or the AI ​​R&D, ZTE has a high degree of dependence on the U.S. industrial chain. Once the sanctions are implemented, let alone a seven-year ban. Even if it is a one-year ban, ZTE will be unable to resist.

ZTE is the representative of the era of "China's QLD", and now Huawei's situation in this group is also not good.

Yu Chengdong officially announced Huawei Mate10Pro to enter the US market at CES this year

Previously, the Federal Communications Commission (FCC) had reported that it would take measures against some US carriers that purchased Huawei and ZTE's telecommunications network equipment. Although this information was denied by Huawei, Huawei was very nervous in the context of tight Sino-U.S. trade. It is possible to become the most vulnerable enterprise in the trade war. Verizon, AT&T, and Best Buy banned Huawei have already explained this.

This morning, Haikang and UOB’s share prices have fallen sharply. Investors may be worried that Haikang Dahua’s export control problems are similar to those of ZTE. However, with the exception of AI chips, the security industry has a low degree of dependence on US parts and investors need not worry too much. However, under the background of tight Sino-U.S. trade, China's high-tech companies are on thin ice at every step in the United States.

Trump’s government “kills the enemy one thousand and loses eight hundred”?

The affected companies are not just ZTE. Some local companies in the United States have also suffered as a result.

The first is the component manufacturing company.

After the ban was issued, Boston-based communications component maker Acacia Communications shares plunged 35.97%, and Oclaro, a provider of optical components, modules and subsystems in the telecommunications and datacom market, also lost 15.2%. Communications semiconductor suppliers Inphi's stock price fell 6%, and Lumentum Holding, a fiber product manufacturer and seller, fell 9.1%.

Acacia Communications shares plunged 35.97%

According to the Investors website, Acacia Communications’ component business relied heavily on ZTE, which contributed 30% of its sales; Lumentum's ZTE sales were 5%-10%, and Oclaro was 17.5%. .

For U.S. chip companies, not only is the stock price drop so simple.

ZTE relies heavily on Qualcomm chips. After the ban is issued, it will directly cause Qualcomm to lose ZTE's large customer.

More importantly, Qualcomm is now preparing to re-apply for NXP acquisitions from Chinese regulators. At present, China is the only country that has not signed Qualcomm’s NXP program, and the application may have a six-month approval time.

Reuters reports Qualcomm is preparing to re-apply for NXP acquisitions from Chinese regulators

Previously, Broadcom’s acquisition of Qualcomm was banned by Trump, citing concerns about China’s security issues behind Broadcom. Feng Shui turns and now when Qualcomm applies to China to acquire NXP, it makes Qualcomm even more perturbed: China is likely to oppose the acquisition because of the trade war and the ZTE incident.

In the longer term, for the U.S. Department of Commerce’s ban on ZTE, China is also likely to adopt countermeasures to restrict Qualcomm and other US companies, but such an outcome may not be the best.

Outside of hardware companies, software companies cannot escape.

The ban covers "any goods, software or technology" exported from the United States, which means that ZTE may not be able to use most of Google's applications. According to these prohibitions, Google will no longer be able to have a business relationship with ZTE, and ZTE's mobile phones cannot be regarded as Android certification. If it cannot be certified by Android, any mobile phone of ZTE cannot obtain market recognition.

The ZTE Mobile Phone Using Corning Gorilla Glass

Currently, ZTE is listed as providing certified Android devices. Google claims that it is "tested for security and performance and pre-installed Google Apps." Includes Google’s Gmail, Google Play Store, Google Maps, and other software. These uses are governed by the Mobile Application Distribution Protocol or MAPA, which is a contract between Google and the device OEM.

In addition, Corning Gorilla Glass used in ZTE mobile phones will also be subject to restrictions.

Deep fear: worry about China 5G; urgent need to rise: Chinese chip and other core component manufacturers need to be strong!

Shortly before the U.S. Department of Commerce issued a ban on ZTE, the United States’ Wireless Communications and Internet Association (CTIA) released a report entitled “Raceto5G.” The report stated that China’s deployment on 5G is aggressive, if the United States does not Release more "middle band", China will win 5G competition.

The report conducted a comparative assessment of 10 countries and showed which countries are currently taking the lead in 5G competition. The report also compiled an index that measures the progress made by each country in advancing the 5G spectrum and infrastructure policies and the industry investment needed to win 5G technology.

The main findings of this report are:

China, South Korea, and the United States are currently ahead of 5G, and China’s leading edge is very small.

U.S. 4G leadership has led to economic and employment growth in other countries.

Loss of wireless leadership in 3G and 4G has significant and long-term negative impact on the telecommunications industry in Japan and Europe.

The US wireless industry is a global leader in business investment and necessary preparation for 5G deployments.

Europe once led the world with 2G speed, while Japan is 3G. In 2010, the United States won 4G competition. Today, the wireless industry in the United States supports more than 4.7 million jobs and contributes 475 billion U.S. dollars annually to the economy.

Once the 5G competition is lost, it may have a huge negative impact on the US wireless industry and the far-reaching economy. This is the deep reason behind the Trump administration's veto of Broadcom's acquisition of Qualcomm, the obstruction of Huawei's mobile phone sales in the United States, and the ban on exporting products to ZTE. .

However, for enterprises, 5G is a general trend that can be foreseen. It is also something the communications industry must do, and it cannot avoid competition. For ZTE and China's mobile phone manufacturers, U.S. manufacturers have leading edge in high-performance analog devices (including RF devices), FPGAs, and EDA tools. Sudden interruption of certain products in these fields can cause enterprises to stop production. Therefore, supply security does not depend on whether a product is listed as "high-end," but only if you can design and produce it yourself.

After ZTE's precision hit, it is hoped that those who really love this industry will start from the most basic components. Even if it is a cliched power supply, AD/DA, phase-locked loop and MCU, as long as the performance is truly "high-end" Can get out of the PPT to achieve mass production, you can replace imported chips on a large scale, that is, the industry to serve the country, will be able to help the domestic system manufacturers to untie the rope around the neck!

Yun Zhisheng founder and CEO Huang Wei also commented in the circle of friends:

When the Sino-U.S. trade war was opened and the U.S. took Nashua to the knife for the Zhongxing, we finally discovered that at many key technological nodes we were subject to people. End of model innovation has come to an end. The country-to-country competition is not depended on the point of delivery, but ultimately depends on hard technology and hard power! Although we have only started, we are still very weak, but we will eventually grow up.

This trade war will also allow some investment institutions to better understand the value, technical value, and team value of companies that truly possess core technological capabilities, not necessarily measured by immediate figures. By relying on delivery, we can never win the future of competition.

LCD Screen

brightness
LCD is a substance between solid and liquid. It can't emit light by itself, so it needs additional light source. Therefore, the number of lamps is related to the brightness of the Liquid Crystal Display. The earliest liquid crystal displays had only two upper and lower tubes, the lowest of the popular type was four lamps, and the high-end one was six lamps. The four-lamp design is divided into three types of placement: one is that there is a lamp on each of the four sides, but the disadvantage is that there will be dark shadows in the middle. The solution is to arrange the four lamps from top to bottom. The last one is the "U"-shaped placement form, which is actually two lamp tubes produced by two lamps in disguise. The six-lamp design actually uses three lamps. The manufacturer bends all three lamps into a "U" shape, and then places them in parallel to achieve the effect of six lamps.
Tip: Brightness is also a more important indicator. The brighter the LCD, the brighter the LCD, it will stand out from a row of LCD walls. The highlight technology we often see in CRT (ViewSonic is called highlight, Philips is called display Bright, BenQ is called Rui Cai) is to increase the current of the shadow mask tube to bombard the phosphor to produce a brighter effect. Such a technology is generally traded at the expense of image quality and the life of the display. All use this The products of this kind of technology are all bright in the default state, you always have to press a button to implement, press 3X bright to play the game; press again to turn to 5X bright to watch the video disc, a closer look is blurred, you need to watch The text has to be honestly returned to the normal text mode. This design actually prevents you from frequently highlighting. The principle of LCD display brightness is different from that of CRT. They are realized by the brightness of the backlight tube behind the panel. Therefore, the lamp has to be designed more so that the light will be uniform. In the early days when selling LCDs, it was a great thing to tell others that there were three LCDs. But at that time, Chi Mei CRV came up with a six-lamp technology. In fact, the three tubes were bent into a "U" shape. The so-called six; such a six-lamp design, plus the strong luminescence of the lamp itself, the panel is very bright, such a representative work is represented by VA712 in ViewSonic; but all bright panels will have a fatal injury , The screen will leak light, this term is rarely mentioned by ordinary people, the editor personally thinks it is very important, light leakage means that under a completely black screen, the liquid crystal is not black, but whitish and gray. Therefore, a good LCD should not emphasize brightness blindly, but more emphasis on contrast. ViewSonic's VP and VG series are products that do not emphasize brightness but contrast!

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