A domestically developed artificial intelligence chip is displayed during the 2019 World Artificial Intelligence Conference held in Shanghai on Thursday. More than 300 Chinese and foreign companies participated in the conference to demonstrate their latest achievements in AI. Photo: VCG

Beijing has been accelerating a de-Americanization campaign in core technologies like semiconductors and servers as the Chinese central government has backed homegrown chipset makers amid an escalating tech cold war with the US in 2019. 

Chipmaker Loongson Technology, a joint venture of the Beijing-based Chinese Academy of Sciences and the Beijing municipal government, unveiled on Tuesday a new generation of general-purpose central processing units (CPUs) with improved performance. 

The company aims to compete with global giants in 2020 and 2021 by promoting a 12-narometer technique and world-class processing capabilities, according to media reports. 

Some industry analysts and internet users on China's Twitter-like Sina Weibo platform hailed the CPU as representative of Chinese homegrown chipsets: All its source codes were designed in China, with a security mechanism, core processor and open-source operating system ensuring compatibility. 

The chipmaker has been exploring setting up a new information technology ecosystem beyond US tech giant Intel and UK-based Arm systems - the two dominant architectures for processors, the reports said.

Loongson said it expected to ship over 500,000 chipsets in 2019. 

It took two decades for a Chinese firm to develop its own chipset, gaining control of CPU technologies, which falls in line with the government's tech ambitions. 

2019 marks a year when China and the US descended into a new cold war not only in trade aspect but also in high technology. While the world's two largest economies have agreed on text for a phase one trade deal, Washington has not eased its restrictions on high-tech exports to China, a rising strategic rival in emerging technologies such as artificial intelligence, big data and 5G. 

"2019 is a turning point for Chinese homegrown technologies," Ni Guangnan, an academician with the Chinese Academy of Engineering in Beijing, told the Global Times on Wednesday. 

"The Huawei issue helped us realize that core technologies have to be in our own hands, which should also be controllable. That largely boosted the replacement process." 

The academician said as competition increases, the domestic industry will need to make breakthroughs in core chipsets and fundamental software including operating systems and industrial software.

As part of the state efforts to enhance scientific and technological capabilities, Beijing has long pursued homegrown core technology development.

But the task became more urgent after the US cut supply to Chinese tech giant Huawei in May. 

"It partly explains the acceleration of homegrown technology development, as the central government has been very determined in making concrete progress and supporting domestic sectors," Fang Xingdong, founder of Beijing-based technology think tank ChinaLabs, told the Global Times on Wednesday. 

The central and local governments have expanded procurement of homegrown software, chipsets and servers this year.

Some offices and public institutions have reportedly removed foreign computer equipment and software, increasing the country's reliance on Chinese technologies. 

Sources at state-backed banks and security firms told the Global Times that their office PCs - mainly provided by foreign firms - have been replaced with domestic products. 

"In addition to boosting self-reliance, it's also part of building a safe and controllable system, with much more efforts lately," Wang Yanhui, head of the Shanghai-based Mobile China Alliance, told the Global Times on Wednesday. 

Chipset and operating systems are considered as shortcomings in China's IT industry, and a "safe and controllable" homegrown technology plan is indeed needed to safeguard the country's network security. 

Domestic tech firms and research institutions including Lenovo, supercomputer manufacturer Sugon, Founder Group and the China Academy of Launch Vehicle Technology have come up with PCs, laptops, severs, network security equipment and industrial computers based on the new Loongson CPU, reports said. 

An employee showcases “Darwin 2,” a brainlike chip developed by a group of domestic research institutions led by Zhejiang University, at the International Artificial Products Expo Hangzhou China held at the Hangzhou International Expo center from Friday to Sunday. The pulsed neural network brain chip can support as many as 150,000 nerve units. Photo: IC

 
Ecosystem disadvantages

China's technologies lack ecosystems for technological applications, analysts said, whereas Western firms such as Intel, Microsoft and Arm are the mainstream players in core technologies. 

"Considering the country's ambition in technological self-reliance, it will take three years for domestic companies to catch up with improving performance and building ecosystem," Fang said.

In some sectors related to national security, foreign computers and equipment will gradually be replaced, he noted. 

Although Chinese chipmakers still have a long way ahead in catching up with their rivals in the US, some lagging homegrown technologies that nonetheless meet Chinese national security requirements can be applied in government-related sectors and crucial infrastructure like finance and transport, Fang said. 

However, a more broader and general market is competition-driven, opening to foreign companies with larger market size, according to analysts estimate. 

The wholesale replacement of foreign computer equipment and software at government offices will generate a potential 200 billion yuan ($28.6 million) market from 2019 to 2020, according to media reports. 

Ni, the academician, said there was no nationwide high-tech de-Americanization as it was only those Chinese enterprises put on the US Entity List that were forced to replace US equipment. 

"China, overall, insists on opening up and fairly treating foreign companies and shows its firm stance of anti-unilateralism and protectionism in trade," he said.