Who's in control of SMIC technology advances?

A TechInsight report disclosed in July 2022 that Semiconductor Manufacturing International (SMIC) had been shipping 7nm chips made with 14nm equipment for the MinerVa Bitcoin Miner SoC for a year. The China-based pure-play foundry has yet to respond to the report, but is believed to have taken a low-profile approach to making its process technology advances.

Despite SMIC looking to transition further to 5nm process technology, there are concerns about whether the departure of several R&D executives and international industry veterans from its board of directors will slow down the foundry's process technology advancements and hit its competitiveness.

Low-key approach

SMIC has been quietly developing its sub-10nm process technology, since being banned from obtaining crucial equipment for cutting-edge chips in 2020. The latest US ban further restricts China's access to chipmaking equipment, expanding from previous restrictions of equipment that make 10nm chips to those for 14nm chips.

Nevertheless, SMIC as the largest and most advanced China-based foundry still plays a key role in China's drive for semiconductor self-sufficiency. China-based fab toolmakers, such as Shanghai Micro Electronics Equipment (SMEE), are supporting SMIC's process technology transitions. It's worth noting that in 2017 SMEE had struck a deal with ASML to help strengthen its lithography technology capability.

When reporting its financial results for first-quarter 2022, SMIC omitted a revenue breakdown by manufacturing process nodes, breaking away from its previous practice. SMIC also stopped disclosing the sales contribution for its FinFET process in its quarterly financial report since second-quarter 2020. Its financial reports now cannot offer a glimpse into SMIC's "actual" performance and competitiveness.

Still, Chinese state media quoted authorities in Shanghai as saying in a September 2022 report that Shanghai-based firms "achieved mass production of semiconductors with 14-nm process and made breakthroughs in 90-nm lithography machines, 5-nm etching machines, 12-inch large silicon wafers, central processing units and 5G chips." Shanghai is where SMIC and Huali Microelectronics are headquartered.

Liang Mong Song

SMIC co-CEO Liang Mong Song is believed to have played a key role in the China-based foundry's advanced process development. Liang joined SMIC in 2017, and has assisted the company in fast-tracking five generations of process development from 28nm to 7nm.

Prior to joining SMIC, Liang served as R&D VP for Samsung Electronics and reportedly played a key role in helping Samsung beat TSMC in the 14/16nm FinFET race. Liang, formerly a senior R&D chief at TSMC, is also known for lawsuits brought by the Taiwan-based foundry against him for allegedly leaking trade secrets to Samsung.

Liang had once claimed SMIC's FinFET N+1 and N+2 nodes could be realized without EUV equipment, before the foundry's management said in early 2021 it would focus on its non-FinFET capacity expansion. SMIC moved its first-generation FinFET technology consisting of 14nm and 12nm process nodes to mass production in the fourth quarter of 2019.

But Liang apparently did not see eye to eye with Chiang Shang-yi, a major R&D architect at TSMC who joined SMIC in 2020. Liang had once offered to resign from SMIC's board of directors after Chiang's arrival, but the company managed to persuade him to stay.

From December 2020 till Chiang's departure from SMIC in November 2021, there had been constant rumors about clashes between him and Liang over the directions of the foundry's technology development.

Liang also stepped down as an executive director at SMIC after the departure of Chiang, who would later describe his stint at the Chinese foundry as the stupidest thing he had ever done. In an interview with the California-based Computer History Museum - published earlier this year - Chiang indicated he did not have trust from "higher-ups" because of his US and Taiwanese citizenships.

SMIC management reshuffle

In SMIC's August 2022 announcement about its new board of directors, neither Liang nor Haijun Zhao is among the executive directors. Both still act as SMIC's co-CEOs, but are no longer involved in the company's decision-making processes.

Tudor Brown, a co-founder of Arm, also announced his resignation from SMIC's board in August 2022. Brown is the latest of those including Chiang and Konrad Young with US or UK nationality to have left SMIC's board since the end of 2020.

All these "foreigners" with engineering backgrounds are gone from SMIC's core of decision-making, which is now led by a chairman, Gao Yonggang, from a finance background.

Source: IC Insights, compiled by DIGITIMES Asia, October 2022