On October 17, 2023, the U.S. government once again expanded its restrictions on the export of semiconductor devices and products to China. The newly added control conditions now encompass NVIDIA’s L40S, A100, H100H800, as well as general-purpose AI server GPUs tailored for the Chinese market, such as A800 and H800. Additionally, AMD’s MI200 series, MI300 series GPUs, and Intel’s Habana Labs’ Gaudi 2, Gaudi 3 GPUs fall under the regulatory framework.

Recalling the U.S. government’s export restrictions on AI chips issued to IC design firms in September 2022, at that time, only A100, H100, and MI200 series were subjected to control, and the U.S. Department of Commerce granted NVIDIA and AMD a one-year buffer period.

In contrast, the recent regulations not only cover all mainstream AI server GPUs but also eliminate the buffer period for these chip companies. In essence, companies or institutions in countries not permitted for export can only acquire AI server chips with performance potentially inferior to NVIDIA L40S or AMD MI200 series for the next few years.

Furthermore, stricter control thresholds for lithography equipment have led to the inclusion of ASML’s DUV, the 1980Di, in the control list. This equipment is primarily used in the 28 ~ 7nm process. Previously controlled products were focused on the EUV 3000 series for 7nm and below processes and the DUV 2000 series for 16/14 ~ 5nm processes.

This move indicates that the U.S. government’s desire to control semiconductor process technology has officially extended to mature processes of 28nm.

The expanded U.S. controls on AI chips and semiconductor manufacturing devices not only target China but also countries that might collaborate with Chinese institutions and businesses in AI development.

In this scenario, China is left with only two viable options to establish efficient AI computing resources: (1) designing and mass-producing AI server chips itself or (2) utilizing the computing resources of cloud service providers.

As the U.S. is also discussing the potential inclusion of cloud service providers in semiconductor control policies and currently formulating relevant countermeasures, this path remains unreliable for China. Therefore, the only dependable option is to independently design and manufacture AI server chips.

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According to IThome’ report, Alibaba Group CEO Eddie Wu, speaking at the 2023 World Internet Conference Wuzhen Summit today, announced that Alibaba is gearing up to open-source a massive model with 72 billion parameters. This model is set to become the largest-scale open-source model in China.

Wu expressed that with AI becoming a crucial breakthrough in China’s digital economy innovation, Alibaba aims to evolve into an open technology platform. The goal is to provide foundational infrastructure for AI innovation and transformation across various industries.

It’s reported that Alibaba has, up to this point, open-sourced Tongyi Qianwen’s Qwen-14B model with 14 billion parameters and the Qwen-7B model with 7 billion parameters.

According to guandian’s report, Eddie Wu mentioned at the 2023 World Internet Conference Wuzhen Summit that AI technology will fundamentally transform the ways knowledge iteration and social collaboration occur, creating a profound impact on productivity, production relationships, the digital world, and the physical world.

He emphasized that society is currently at a turning point from traditional computing to AI computing, with AI eventually taking over all computing resources. The dual drive of AI and cloud computing is the underlying capability that Alibaba Cloud relies on to provide services for the future AI infrastructure.

In addition, on October 31st, Alibaba Cloud announced the release of the large-scale model Tongyi Qianwen 2.0 at the Apsara Conference. On the same day, the Tongyi Qianwen app was officially launched on major mobile application markets. Compared to the 1.0 version released in April, Tongyi Qianwen 2.0 has shown improvements in capabilities such as complex instruction understanding, literary creation, general mathematics, knowledge retention, and illusion resistance.

(Photo credit: Alibaba)

Wistron experienced a slowdown in shipments for product lines like PCs and displays in October, following the prior demand surge. However, their GPU-related AI server products continue to maintain their growth trajectory. Simultaneously, Wiwynn, a subsidiary of Wistron, witnessed a remarkable 20% month-over-month revenue increase due to the rising momentum in AI server-related project shipments, positioning them at the third-highest monthly revenue level in their history for the same period, reported by CTEE.

Both Wistron and Wiwynn hold an optimistic outlook for their AI server products, expecting the growth momentum to extend into the next year. In contrast, they foresee a return to growth trends for non-AI general-purpose servers and cloud data center servers next year, while AI server growth is expected to remain notably strong.

Wistron plays a pivotal role in the AI server supply chain and remains unaffected by high-end GPU shortages and U.S. export restrictions. Shipments in Q4 continue to exhibit consistent month-to-month growth, and the anticipated trend to peak in the second half of the year remains steadfast. Moreover, there are indications of a slight seasonal increase in general-purpose servers in Q4.

In a recent earnings call, Wiwynn maintains an optimistic stance for Q4 and the upcoming year. With the evident growth momentum from AI servers, they anticipate that developments in AI-related projects will lead to a continuous improvement in AI server product shipments.

Furthermore, Wiwynn’s third-largest customer business and AI server revenue both exceeded 10% in the third quarter, marking a significant milestone for the company. Back in October, Wiwynn had set up  a server plant in Malaysia to meet the surging demand for AI servers.

According to TrendForce’s anticipation, in 2023, the shipment of AI servers (including those equipped with GPUs, FPGAs, ASICs, etc.) is expected to exceed 1.2 million units, with a year-on-year increase of 37.7%, accounting for 9% of the total server shipments. In 2024, it is projected to further grow by more than 38%, with shipments reaching approximately 1.676 million units, and the share of AI servers will exceed 12%.
(Image: Wistron)

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Chinese smartphone giants like Xiaomi and Vivo are entering the satellite communication technology arena. A Chinese industry insider claimed that Huawei maintains an exclusive hold on satellite communication solutions for smartphones has stirred controversy, resulting in other smartphone manufacturers having to bide their time before introducing their satellite communication features, Jiwei reported.

An insider at China Telecom affirmed that this technology is not exclusively held by Huawei. However, achieving satellite communication on smartphones indeed poses certain technical challenges, crossing over the substantial R&D efforts to break through the bottlenecks on chip module miniaturization (including RF, Baseband Unit, etc), optimizing the TCP/IP protocol over satellite communication, and end user management.

Huawei Mate 60 Pro has emerged as a pioneer in satellite communication, offering support for satellite calling. Industry insiders have revealed that the satellite communication processor within Huawei Mate 60 Pro was specially crafted for Huawei by a research institute under the China Electronics Technology Group Corporation (CETC). Therefore, Huawei Mate 60 partnered with China Telecom to achieve “satellite calls” services via China’s domestic satellite “Tiantong”, which is currently operated by China Telecom.

Moreover, Qualcomm’s recent announcement about partnering with smartphone brands such as Motorola, OnePlus, Honor, OPPO, Vivo, Xiaomi, and others to develop smartphones with satellite communication feature indicates a broader interest in this technology.

Currently, the consumers tends to extend their device-replacement timelines since the upgrades on smartphone hardware stuck in the bottlenecks such as the performance improvements of processors and camera modules are limited, proven by TrendForce’s estimation that the YoY growth rate of the average DRAM content of smartphones will reach around 6.7% for 2023. This projection is a significant improvement compared with the YoY growth rate of 3.9% for 2022. However, TrendForce also forecasts that the YoY growth rate will stay under 10% in the next several years.

As for smartphone CIS, the shipments is projected to decrease from 4.46 billion units in 2022 to a more subdued 4.318 billion units in 2023. That translates to a YoY contraction of 3.2%.

Consequently, satellite communication is poised to become a key selling point, enticing consumers to upgrade their devices. The industry foresees satellite communication features extending beyond high-end smartphones, and becoming available across a wider range of models, with this shift expected to happen between 2024~2025.
(Image: Huawei)

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• Server DRAM Will Overtake Mobile DRAM in Supply in 2023 and Comprise 37.6% of Annual Total DRAM Bit Output, Says TrendForce

On November 6, 2023, MediaTek unveiled its latest flagship smartphone SoC, the Dimensity 9300. Benchmark data reveals that the Dimensity 9300 outperforms Qualcomm’s flagship chips in both CPU (multi-core) and GPU performance.

However, Qualcomm enjoys a strong brand reputation and recognition in the consumer market, making it a challenging task for MediaTek to capture the top market position for high-end SoCs in the Android camp with this chip.

TrendForce’s Insights:

1. Brand New Design Boosts Dimensity 9300 Benchmark Performance

Diverging from the conventional “big core + small core” architecture, MediaTek introduces a groundbreaking “4+4” design in the Dimensity 9300. This chip comprises 4 Cortex-X4 cores (clocking up to 3.25GHz) and 4 Cortex-A720 cores (running at 2.0GHz).

According to MediaTek’s official data, this new architecture delivers a 40% increase in multi-core peak performance compared to the previous-generation Dimensity 9200. Additionally, it achieves a 33% reduction in power consumption while maintaining the same level of performance.

In addition to its outstanding chip performance and energy efficiency, the Dimensity 9300 achieves a significant breakthrough in the field of AI. According to official data, powered by the seventh-generation AI processor APU790, the Dimensity 9300 achieves AI edge computing processing speeds up to 8 times faster than the previous generation. In practical terms, this means it can generate image content from text in less than 1 second.

Furthermore, through MediaTek’s exclusive memory compression technology, known as NeuroPilot Compression, it significantly reduces the memory footprint of AI Large Language Models (LLMs) on end-user devices. This enables smooth operation of LLMs with up to 1 billion, 7 billion, 13 billion, and even a maximum of 33 billion parameters on terminal devices.

2. Dimensity 9300 Outperforms, but Qualcomm Remains a Strong Contender

While Dimensity 9300 exhibits superior performance in both CPU (multi-core) and GPU compared to Qualcomm’s concurrent flagship Snapdragon 8 Gen 3 SoC, a consumer survey conducted by a well-known international tech product comparison website tells a different story.

Out of 1,833 valid respondents, even after being informed about Dimensity 9300’s better benchmark results, 946 people (representing 51.6% of respondents) still chose the Qualcomm chip with lower scores.

This is likely because major smartphone manufacturers have historically favored Qualcomm over MediaTek for their flagship devices. Qualcomm has built a stronger brand image and enjoys higher recognition in the market. Therefore, MediaTek faces a formidable challenge in its quest to capture the top spot for Android high-end smartphone SoC market share with Dimensity 9300.

Furthermore, since the current benchmark results are derived from engineering samples, and the ultimate products from smartphone manufacturers have not been officially released, it remains to be seen whether Dimensity 9300 can deliver the expected performance efficiency. The final verdict on its performance will depend on the adjustments and optimizations made by these manufacturers.

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(Photo credit: MediaTek)