Province bolstered by domestic chip industry

Guizhou Huaxintong Semiconductor Technology Co has signed a strategic partnership with GuizhouCloud Big Data Industry Co to jointly develop a cloud platform based on homegrown chips. The move is part of the local government’s efforts to beef up its presence in information technology.

The cloud platform will include chips that use ARM architecture, a design that has the edge over competitors because of its attractive cost and low power consumption. It will offer a full set of cloud-service solutions, including chips, servers, operating systems and cloud applications.

The advanced chip was developed by Guizhou Huaxintong, which is a joint venture between Qualcomm Inc, a leading manufacturer of semiconductors, and the government of Guizhou province.

In recent years, foreign brands have dominated China’s semiconductor market, so the founding of Guizhou Huaxintong injected fresh impetus into the development of the domestic industry.

Chips are the “hearts” of power servers, which act as “engines” to drive the flow of data in various industries, including the core business systems of financial companies, along with the telecoms, electricity and energy transmission sectors.

Guizhou Huaxintong has worked hard to develop homegrown chips, and plans to start shipping China-customized server chips next year.

“We want to enable the joint venture to build its own capability and be capable of taking our technology and developing its own chip systems for the China market,” said Derek Aberle, Qualcomm’s president.

Earlier this year, Qualcomm and the Guizhou government poured 1 billion yuan ($144 million) into the company, bringing the total investment to 2.85 billion yuan, in a bid to strengthen the chip sector.

The amount Qualcomm and the Guizhou government invested in the joint-venture semiconductor company Guizhou Huaxintong earlier this year. The total investment is 2.85 billion yuan.

“The intensified efforts to develop homegrown chips is of great importance to help upgrade Guizhou’s traditional industries with information technologies because internet data centers have mushroomed and triggered demand for server chips,” said Ouyang Wu, chairman of Guizhou Huaxintong.

Qualcomm is not the only company that Guizhou has attracted. International outfits such as Apple, Alibaba and Hyundai Motors have moved in, resulting in the province being transformed into an innovation hub where information technologies have fueled economic growth.