China is enlisting Alibaba and Tencent in its fight against US chip sanctions

China has enlisted tech giants Alibaba and Tencent to help with its semiconductor chip design efforts as Beijing braces for further US-led sanctions aimed at curbing China’s computing power.

The Chinese government has formed a consortium of companies and research institutes, including the Chinese Academy of Sciences, to develop new chip intellectual property. The Beijing-based technology company wants to reduce its dependence on SoftBank-owned Arm, which underpins most semiconductors worldwide.

The group uses Risc-V—pronounced “Risc-five”—an open-source chip design architecture created by the University of California, Berkeley in 2010. Risc-V has emerged as a competitor to Arm in recent years.

Open source code can be developed, accessed, used and improved by anyone.

Beijing’s interest in Risc-V has grown as Washington has increased pressure on China’s technology sector by restricting access to cutting-edge chip components and machinery.

The US has been lobbying its allies, including the Netherlands and Japan, to cut Chinese tech companies off their supply chains, as it did with Huawei in 2019. This has prompted China to prepare to further disrupt the semiconductor supply chain.

Arm, which is headquartered in the UK but has significant operations in the US, is seen as vulnerable to any tightening of US sanctions targeting Beijing for supplying its designs to Chinese tech companies.

A Chinese official said the government’s effort to pool resources in Risc-V-based chip design will put China “on the right track.” The official added that the fragmented nature of Risc-V’s development — hundreds of different companies use its open-source software architecture — has slowed changes to Arm designs.

“Under increased US export controls, we must prepare for the worst,” the official said.

A government-backed consortium known as the Beijing Open Source Chip Research Institute has developed Xiangshan, a high-performance Risc-V computer processing chip aimed at adapting to Arm’s IP and boosting the development of China’s chip design market.

The idea behind Risc-V started with other open standards and software revolutionizing the digital world.

As open architecture began to gain interest outside academia, the Risc-V Foundation moved its headquarters from the US to Switzerland in 2019 to strengthen its geopolitically neutral position in the chip ecosystem.

Before Beijing’s push to pool resources, Chinese tech giants Alibaba and ByteDance had already formed teams using the Risc-V architecture to develop high-performance chips that power artificial intelligence algorithms and data centers, according to five employees who spoke to the Financial Times.

“Our goal is to develop Risc-V [chips] to replace existing Arm ones in our most advanced products,” said a senior engineer at T-head, Alibaba’s chip arm.

However, one executive said that goal is still years away from becoming a reality, given that T-head has to contend with tight finances as a result of declining profits at its parent company.

ByteDance said its business is at an early stage, while Alibaba’s development capacity is mainly in the Internet of Things sector.

Risc-V has gained traction in the west since 2020, when Arm’s proposed $66 billion sale to US chipmaker Nvidia sent shockwaves through the semiconductor industry and prompted several companies to look more seriously at alternatives to Arm . The deal later fell through, and SoftBank, which owns the chip designer, plans to list Arm in New York next year.

Earlier this year, US chip giant Intel invested part of its $1 billion innovation fund in Risc-V, saying its foundries would be able to make chips based on three major chip design architectures: Arm, Intel’s own X86 and Risc-V.

Arm chief executive Rene Haas admitted in an interview with the FT earlier this year that Risc-V was a “very real threat to our business”.

However, he said Arm has a significant advantage because it offers software alongside its designs and has a community of 50 million developers, making it “more and more difficult to take things away from Arm.”

Semico Research predicts that 62.4 billion chips based on Risc-V will be shipped by 2024.

Semico estimates that Risc-V accounted for only $80 million of the total $2.2 billion IP market for computer processor cores in 2020. However, it expects this to grow to $687 million by 2027, taking its global market share from 1 percent. up to 16 percent.

“Risc-V started as a curiosity next to Arm, then it became an alternative, and now it’s a competitor,” said Semico Research analyst Richard Wawrzyniak.

Line graph of total forecast revenue ($ billion), Risc-V AI systems-on-a-chip, with application showing rapid growth of Risc-V forecast in AI

In a further sign of increased interest, Apple has moved some of its internal cores from its Arm processors to Risc-V, which powers technologies such as WiFi, Bluetooth and touchpad control, according to two people briefed on its plans. Apple has also posted a number of job postings in recent months looking for engineers familiar with Risc-V.

Companies interested in developing Risc-V designs have two options: build an in-house team using the open source architecture, or license one of the companies that sell their chip designs using Risc-V. These include SiFive in the US, Codasip in Europe and Andes Technology in Taiwan. T-head, Xiangshan and ByteDance all develop Risc-V chips in-house.

So far, Risc-V has been adopted mainly for performing relatively simple tasks in hidden parts of the device, also known as “embedded” processes, as well as for IoT applications.

But it has also recently gained traction in several markets for chips that boost device performance or enable “intelligence,” including data center server processors and artificial intelligence chips.

“Risc-V has no limitations. Whatever preconceived notions you may have. . . they are wrong. It will be everywhere, it will do everything,” SiFive co-founder Krste Asanovic said in September.

Ron Black, Codasip’s chief executive, said his company raised the money to design high-end processors because “many of our customers are telling us there needs to be an alternative to Arm.”

Intel said Risc-V “is gaining traction in embedded markets and is expected to enter the IoT, automotive, mobile and data center markets in the next 3-5 years.”

The US chipmaker added that the open-source architecture is “still in its infancy and needs the support of the ecosystem to further innovate and adopt the market”.

However, several of Arm’s biggest customers are still unconvinced of Risc-V’s potential.

Qualcomm chief executive Cristiano Amon told the FT earlier this year that the company had started working on Risc-V designs for its low-power embedded processors as a “defensive move” but that the open architecture was not yet sophisticated enough to be used. for high-performance functions.

In China, the incentives to use Risc-V are stronger.

“You never know when the next round of US restrictions will come. . . Using Arm’s architecture is very risky now, it’s like revealing your biggest weakness to the enemy,” said a Tencent engineer working on the Xiangshan project.

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