In recent years, thanks to the rapid development of 5G, servers, data centers, smart cars and other markets, the global storage demand has risen rapidly. Entering 2021, the core shortage crisis has driven the storage market to actively stock up in the first half of the year, and the supply and demand situation is obviously in short supply. However, with the contraction of market procurement, industrial supply and demand will reverse again in the second half of the year.
The storage market is complex and changeable. How do domestic manufacturers respond to the crisis? How can enterprises maintain a competitive advantage, achieve sustainable development, and then move into the high-end storage market?
With these questions, Global semiconductor Watch recently had an in-depth dialogue with Mr. Ni Huangzhong, chairman of the domestic storage manufacturer Shichuang.
Not afraid of lack of cores, it is time for creative expansion
Founded in 2008, Shichuang is a national high-tech enterprise integrating chip design, software and firmware R&D, packaging and testing, manufacturing and application in the field of memory chips. Its products and businesses cover embedded memory such as smartphones (eMMC/LPDDR) Chip), PC (SSD solid state drive, DRAM memory module), server (enterprise SSD solid state drive, enterprise DRAM memory module) storage products and mobile storage products for three major application scenarios, providing one-stop service for global customers Storage solutions and product customization services.
This year, the shortage of chips has swept the world, but Ni Huangzhong said that the lack of chips has little impact ON creativity. On the one hand, thanks to its own strategic planning, the company made very large periodic orders for controllers and wafers in advance last year, so when the industry was out of stock this year, Shichuang did not encounter the problem of lack of cores. On the other hand, Shichuang respects and treats all manufacturers in the supply chain with kindness, and has a strategic partnership with suppliers. The priority of supply is very high, and the company will not face a dilemma during the crisis of core shortage.
In terms of production capacity, Ni Huangzhong introduced that in October this year, Chuangyi relocated its factory, and the two factories were integrated and optimized, and the manufacturing area increased by 30% compared with the previous one. With the smooth relocation of the factory, the moving of new equipment, and the optimization and upgrading of the factory, the creative packaging capacity will increase from the current 12kk/month to 16kk/month by the end of the year, and the SSD module capacity will increase from 1kk/month to 1.5kk/month.
Embedded products develop rapidly, and eMMC chips perform well
At present, Shichuang has formed three major application scenarios for smartphones (embedded memory chips such as eMMC/LPDDR), PCs (SSD solid-state drives, DRAM memory modules), and servers (enterprise-grade SSD solid-state drives, enterprise-grade DRAM memory modules). Ni Huangzhong revealed that at present, SSD solid-state drives make the largest contribution to the company’s revenue, and the second largest revenue contribution is embedded memory chips.
Shichuang released 256GB eMMC for the first time in China last year and started mass production. At present, eMMC 8GB-256GB full-capacity series products have been shipped. The product quality has passed the compatibility test verification and strict quality control standard requirements of many domestic mainstream platforms. Highly praised by customers.
In terms of future product planning, Shichuang will continue to enter the field of high-end storage, aiming at smartphone, PC and server, mobile storage application scenarios, in-depth layout of embedded memory chips, SSD solid-state drives, DRAM memory modules and other full series of products, including UFS, R&D and launch of eMCP, enterprise SSD and other products.
Towards high-end storage, the new brand WeIC is about to debut
In recent years, domestic storage manufacturers have risen rapidly, and have begun to advance from low-end to high-end, and the same is true of Shichuang.
Ni Huangzhong said bluntly that Shichuang will focus on high-end storage in the future and will not fight in the low-end market. Therefore, Time Creative will give up some revenue from low-end products every year, but promote revenue growth by developing high-end new products and increasing the proportion of sales, thus not only maintaining the overall market growth, but also contributing to the company’s overall gross profit and increase in net profit.
Compared with revenue growth, current creatives pay more attention to the improvement of brand value and influence. Therefore, in order to promote enterprises to enter the high-end storage field faster and further enhance the influence of the industry, Shichuang will launch a new brand: WeIC at the MTS2022 Storage Industry Trends Summit held on November 18th.
Ni Huangzhong introduced that at present the company only has a brand named SCY, which has penetrated into SSD, memory sticks and embedded products. In the next step, the company will release a storage product in the field of industrial control and subdivision: WeIC, our own chip.
WeIC will be positioned as a storage brand in the industrial control and subdivision fields, and its products also cover embedded memory chips, SSD solid-state hard drives, etc. It is reported that after the launch of the new brand, products with the WeIC logo will also be unveiled at the MTS2022 Storage Industry Trends Summit.
The east wind is coming, and the future prospects of Shichuang can be expected
Looking forward to the company’s development next year, Shichuang has set a development goal of 3 billion yuan in revenue.
Ni Huangzhong introduced that this year, the company’s factories have been integrated and upgraded, the Shenzhen Nanshan R&D Center has tripled, and the Shanghai technical team has been expanded. The combination of production capacity and R&D can better help the business development next year.
“Everything is ready, and we only owe the east wind,” said Ni Huangzhong. As the price of memory continues to drop to a level that everyone can accept, we are optimistic about the market.
Of course, for Time Creative, “Dongfeng” doesn’t stop there. Ni Huangzhong revealed in the dialogue that the idea will be listed at the right time in the future.
Ni Huangzhong said that with the growing scale of the company’s development, the investment in creative R&D, especially the enterprise-level SSD, will increase. On a higher platform, do deeper technical iterations, and improve products from breadth to depth in an all-round way. At the same time, the listing can also allow the company to develop in a more standardized way, get on a larger platform, have a larger customer base, break through the bottleneck of development, and leverage its strength to become a leading storage enterprise.
Opportunities and challenges: How do domestic storage manufacturers grasp?
Looking forward to the future development trend of the storage industry, Ni Huangzhong believes that there are still many market opportunities. The development of 5G and automotive intelligence will continue to generate market demand for storage. Some segments, such as VR, game phones, drones, scanning pens, education tablets, Advertising machines, etc. have also brought new development opportunities, and the customized demand for market segments will be a major trend in the future.
“Sometimes there are many opportunities, and it may not necessarily belong to you. Domestic storage companies still need to make strategic preparations in advance to maintain a competitive advantage, so that they can seize opportunities when they come.” Ni Huangzhong said.
Ni Huangzhong introduced that the core competitiveness of Shichuang is reflected in the technical advantages, product customization advantages, advanced manufacturing advantages, one-stop memory procurement advantages, and the ability to integrate resources.
This enables Time Creative to respond quickly and follow up flexibly when faced with customized demands, thus embracing this market opportunity.
In terms of challenges, Ni Huangzhong believes that the shortage of cores in the Semiconductor industry will gradually ease next year, and the challenges facing domestic storage manufacturers in the future are still in terms of technology. Enterprises should not be content with being market imitators and followers, but should achieve technological breakthroughs and change from followers to leaders.
For Time Creative, Ni Huangzhong believes that the company has basically no gap with overseas companies in the field of embedded products and consumer-grade SSD modules. “It’s just that the product may be released a little later than them. In one to two years, the company will be able to make up for this shortcoming.” Ni Huangzhong said.
However, in the field of enterprise-level SSDs, the technology gap is still relatively large. Ni Huangzhong said that the main reason is that the creative enterprise-level SSDs start from scratch and need to be constantly explored. At the same time, Shichuang will continue to recruit talents, strengthen research and development, strive to catch up, and achieve technological breakthroughs.
On November 18th (Thursday), Shichuang will bring a full range of products to the 2022 Storage Industry Trends Summit. At the summit, SCY brand embedded memory chip products, solid-state drive products, memory modules, etc. will be exhibited.
At that time, Chairman Ni Huangzhong will also bring a new brand of Time Creative to debut, and share a speech on the theme of “The Future Has Come, the 3.0 Era of Memory Chip Module Manufacturers”, so stay tuned.
▲Special reminder: In order to protect the health and safety of all participants to the greatest extent, TrendForce will closely monitor the latest situation of epidemic prevention and control. Please pay attention to the “Guide to Attending” published by Global Semiconductor Watch to keep abreast of the latest developments of the summit.