Rebirth 08: Rise from copycat phones

Chapter 354: Europe and America's Defense Break

It is the beginning of August, and just like in previous years, when time reaches this point, the many confusing news suddenly become less.

Some entertainment news suddenly disappeared. Celebrities no longer exposed their love affairs, got divorced, or cheated...it was very quiet.

There is no such thing as a full-network promotion before a blockbuster movie is released.

Many companies do not release any new products at this time. There were quite a few mobile phone companies releasing new products in July, but they all disappeared after August.

The new generation of young netizens may still find it strange, but old netizens or people working in the media industry know that the annual Zhiyun flagship phone launch conference is about to begin.

In the period before and after the launch of Zhiyun's flagship phone, no company would make any big moves at this time to try to steal the limelight from Zhiyun's flagship phone.

It’s not that I don’t want to, but I can’t get it!
Since the beginning of August, a large amount of pre-launch news about Zhiyun's flagship phone has begun to appear frequently, and Zhiyun-related news has directly dominated the hot search lists on many media platforms.

All kinds of true and false news appeared in it, sparking people's enthusiasm for discussion.

This is not only the case in China, but even abroad, there has been widespread discussion on Zhiyun's new generation flagship phone.

The current Zhiyun S series of mobile phones are so powerful!

It is not only the world's top high-end mobile phone brand, but also the single model with the largest sales volume, and also the mobile phone brand with the largest stock in the world.

To what extent?
Even the elderly in rural areas are using a large number of old Zhiyun phones retired by their children... Because Zhiyun phones are simple and easy to use, and have a clean ecosystem, they are very convenient for elderly people with low cultural levels. There is no need to worry about dozens of messy apps appearing on their phones after a few days of use.

Therefore, many children like to get a Zhiyun mobile phone for their parents... and use it as a senior citizen phone.

Although Zhiyun mobile phone is a high-end flagship phone, it is actually easy to use, and has high hardware performance and a good ecosystem. Even old models from a few years ago are still very powerful today. An S13 phone from three years ago is more reliable than those new phones that cost more than 13 yuan... because the S403 chip used in the S three years ago is a high-end chip based on a -nanometer process.

Even now, many new mobile phones priced at two to three thousand yuan still use chips made with 28-nanometer process.

Among Zhiyun Semiconductor's W series SOCs, the W28 series chips based on the 600nm process and the W28 series chips based on the 700LP nanometer process still have the largest shipments.

Especially the W700 series chips, which are widely used in mid- and low-end models.

Among domestic mobile phones priced at RMB 701, almost all of them are equipped with the W chip, with prices ranging from RMB to to over RMB .

Mobile phones priced between RMB 702 and RMB 700 are most likely to use the W chip, which is a mid-range chip in the W series.

Mobile phones priced at more than 706 yuan generally use the W700 chip, which is a high-end model in the W series.

The entire W700 series has shipped an astonishing million units in the first half of this year, making it the most shipped mobile phone SOC product in Zhiyun Group.

The second largest in terms of shipments is even more backward. It uses the first-generation 28nm process of the W600 series chips, which are currently used in the mid-to-low-end market. Many low-priced mobile phones exported use this series of chips. At the same time, its version without communication baseband is also widely used in various smart terminals, such as various Android tablets, smart TVs and other miscellaneous products.

So even though the W600 chip is an old product from several years ago, its shipment volume is still very large.

The two series of chips, W600 and W700, support Zhiyun Semiconductor's main export chip shipments.

As for the more advanced W800 and W900 series, the shipment volumes are actually not that large.

The W800 series chips based on the 600nm process began shipping last year. Because the 700nm process is a transitional process, Zhiyun Semiconductor only launched a high-end chip series at this process node, and did not cover the high-end as well as the mid- and low-end markets like the W and W.

Therefore, the shipment volume of the entire W800 series chips is relatively average, mainly installed in high-end flagship phones of four-star Galaxy, Xiaolan MAX and other brands. As the shipment volume of these older mobile phones gradually decreases, sales have also dropped significantly...

The main reason is Zhiyun Microelectronics' 14-nanometer process, which is itself a transitional process and was launched for the Zhiyun S mobile phone.

However, the performance of chips produced by the 18-nanometer process is much lower than that of chips produced by the 14-nanometer process, but the price is not much cheaper. As a result, the production line of the 18-nanometer process has a very low cost performance...

Lian Zhiyun Group itself, a large number of products originally based on the 18nm process are being fully transformed to the 14nm process production line, and the production of 18nm process products will be discontinued.

The W900 series chips based on the -nanometer process, which began shipping this year, are the most dazzling new star in Zhiyun Semiconductor's external sales this year.

The performance is extremely powerful, but the current 906-nanometer process chips are very expensive. Zhiyun Semiconductor has only launched the high-end W905 and the mid-range W chips, and has not launched low-end and mid-range models... It's not that they have not been designed, but they have not yet been launched on the market!
The design and tape-out costs of the 14-nanometer process chips, as well as the subsequent foundry costs are too high. The cost of the chips produced is also expensive, and it is not possible to make mid- and low-end chips for the time being... customers cannot afford them.

It is estimated that the 14-nanometer process chips will have to wait until next year to be used in the mid- and low-end markets.

This year, the top flagship chip of the W900 series is mainly used in the flagship phones of the Xiaolan MAX series and some mobile phone brands that have not yet been released. It is estimated that the shipment volume this year will be at most tens of millions of pieces.

As for the four-star chip company, after comprehensive consideration of the pros and cons, their chip strategy this year is to use Qualcomm Snapdragon 820 in markets outside of China, and W905/6 chips for high-end models in the Chinese market.

The above-mentioned high-end flagship models are the only customers of this year's W905/6 chips... There is no other way. The W900 series chips using the nm process are too expensive and ordinary mid-range models cannot afford them at all.

Looking at the sales of Zhiyun Semiconductor's W series chips, it can be seen that don't think that Zhiyun's new generation of mobile phones, the S16 series, are all moving towards the -nanometer process, which means that -nanometer process chips or TSMC's -nanometer, or even Zhiyun's previous -nanometer process chips are everywhere!

not like this!
Today, 18/16/14 nanometer chips produced using the double exposure process are still limited to the high-end market, while smart terminals in the mid- and low-end markets still use 28 nanometer chips.

Of course, there are exceptions, such as the Dami mobile phone under Dami Technology, which can get you a phone equipped with a W1999 chip for only 906 yuan...but although this phone is good, ordinary consumers can't get it at all.

If consumers could just snap up this phone, Da Mi would lose a lot of money!

After all, the price of Zhiyun Semiconductor's W906 chip is very expensive now... Xiaomi is losing money on every mobile phone it sells, so it must control sales.

Apart from Xiaomi, which takes the route of extreme cost-effectiveness, other mobile phone manufacturers' mid- and low-end mobile phones, and even some mobile phones priced around 28 or 600 yuan, are basically based on the W700/ chips with nm process.

Looking at the market situation of mobile phone SOC, you will find that even the Zhiyun S13 series mobile phones from a few years ago are still better in performance than many newly released mid-range mobile phones!
This is also one of the reasons why Zhiyun phones are so valuable and the performance of older models is still strong... Another major reason is that in the domestic market, Zhiyun’s mobile phone ecosystem is very well controlled.

A good ecosystem can also make the phone use more smoothly.

The combination of the two means that Zhiyun phones can be used for a long time without becoming outdated... By the way, this is also a major problem that plagues Zhiyun Group. Old users don't like to change their phones, and always think that old phones are good and can last for a few more years.

If the battery is not durable enough, you can replace it and continue to use it for two or three years. Even if the screen is broken, you can go to a repair shop and replace it with a third-party low-quality screen for a few hundred yuan and continue to use it.

There are a lot of nail users!
So in the past year, the software mall under Zhiyun Group has actually quietly relaxed some restrictions, allowing software manufacturers to make their APPs more bloated and more demanding on hardware performance.

For example, Zhiyun Group used to be very disgusted with software manufacturers who inserted a game engine into non-game apps... But now it has turned a blind eye. As long as it is not too excessive and arouses widespread disgust among users, Zhiyun Mall will pretend not to see it.

The old phone starts to lag, which gives you the motivation to change it. You can't just wait until the phone breaks down before changing it, that will take forever...

Now Zhiyun Group has started to encrypt the screen and battery parts of S15MAX, which are prone to wear and need to be replaced.

Try to prevent third parties from replacing batteries, screens and other spare parts as much as possible.

However, everything was done quietly without any publicity, mainly because it involved monopoly issues and could easily attract criticism.

Zhiyun does not forbid users from replacing third-party spare parts... It's just that after replacing the spare parts, they cannot match each other, resulting in the failure of some core functions, such as face recognition, battery safety, and some specific functions of the camera cannot be used.

In short, make the money first, and you can change it later at worst!

After the smartphone market entered the stock market, Zhiyun Group worked very hard to increase revenue and began to use all kinds of messy tricks.

From various keyboards and mice, small speakers, data cables, charging heads and other peripherals, plus the continued promotion of the popularization of Bluetooth headsets, promoting the education market for PC products and tablets, launching special education versions, and promoting smart ecological chain products such as smart homes, and strengthening the content ecology.

Now they are even starting to get involved in the repair field, trying to earn more revenue in the repair field... It would be best if the bankrupt users replaced their phones as soon as possible... What's the point of using old phones? Just throw them away, don't keep them as heirlooms!
The purpose of Zhiyun Group's comprehensive improvements is simple, which is to further promote the group's overall revenue growth.

This year, Zhiyun Group’s goal is to achieve a revenue of 400 billion US dollars!
Among them, the revenue from the semiconductor business and other electronic consumer industry chain spare parts market is at most about 800 to 900 billion US dollars.

This means that various smart terminals and peripherals, software and Internet businesses centered on smartphones must reach around US$310 billion, and to be more stable, it would be best to have US$320 billion.

This will be a huge challenge.

------

People are still using a large number of old mobile phones, and at the same time, so many new mobile phones are sold every year, which also leads to a very large stock of Zhiyun S series mobile phones.

Taking a walk around the subway in a major city in China, at least seven or eight out of ten people are using Zhiyun S series phones.

So even though the Zhiyun S series of mobile phones are top-level flagship phones and are expensive, they have even launched the even more expensive MAX series, starting at 8,000 yuan.

But to some extent, the Zhiyun S series of mobile phones have gradually become a very popular national mobile phone...

This is a very unique phenomenon, and it is something other mobile phone brands dream of but cannot achieve.

As such a globally known brand releases a new mobile phone, its influence is naturally huge.

Not to mention, the launch of Zhiyun Group's flagship phone has now developed into something of a high-tech summit, with many bosses of high-tech companies coming to join in the fun and even taking the opportunity to promote their products.

This also led to the increasing influence of Zhiyun Group's flagship phone launch conference.

Faced with this kind of flagship phone launch conference, other mobile phone manufacturers and even other industries have adopted an attitude of temporarily avoiding the limelight. ————

In order to support the new mobile phone and further arouse people's discussion, Zhiyun Group officially announced its second quarter financial report on August 3.

This financial report also attracted a lot of attention.

In the first quarter and the first half of this year, Zhiyun Group achieved a total revenue of more than 180 billion US dollars in half a year.

At first glance, it seems that the revenue of only 180 billion US dollars in half a year is not much, and multiplied by two, it is only 360 billion US dollars in revenue.

It seems no different from last year.

But you have to know that the first half of the year is a low season for Zhiyun.

Because Zhiyun’s new generation flagship phones have only been released in August in recent years.

At the same time, Zhiyun's flagship phones are often shipped in large quantities within a few months after their launch. In just four months, the shipments of new models often account for more than 60% of the annual shipments of new models.

Therefore, Zhiyun Group's revenue in the second half of the year often significantly exceeds its revenue in the first half of the year.

Under such circumstances, Zhiyun Group was still able to achieve a revenue of 180 billion US dollars in the first half of the year, which made people, especially those in the capital market, relatively optimistic about the operating conditions of Zhiyun Group.

This also drove Zhiyun's stock price to continue to rise.

On August 6, Zhiyun Group’s market value has risen to 800 billion US dollars, making it the world’s first company with a market value of over 800 billion US dollars, and is far ahead of others!

This is actually not easy for a high-tech company with asset-intensive businesses such as semiconductor manufacturing!

In fact, many investors believe that if Zhiyun Group sells off its costly and unprofitable semiconductor manufacturing business, its annual net profit will have to increase by another 10 to 20 billion US dollars, and its market value may even reach one trillion US dollars.

However, some investors believe that if Zhiyun Group abandons its semiconductor manufacturing business, it will not be able to ensure high profits in its smart terminal business, and will eventually become a mediocre mobile phone manufacturer. At that time, it is not sure whether it can maintain even $500 billion, let alone $1 trillion.

Different investors have different opinions on Zhiyun Group's heavy investment in the semiconductor field.

These investors with different opinions eventually played games in the capital market, and the market value of US$800 billion became the result of compromise between the two parties.

Zhiyun Group’s breakthrough of the US$800 billion market value mark has once again made Zhiyun Group headlines around the world.

The Wall Street Journal once again reported the news on the front page, and conducted a very in-depth analysis and report, and made a horizontal comparison between Zhiyun Group and Apple, Qualcomm, Intel, TSMC and Four Star.

Try to analyze and prove why Zhiyun Group’s market value is so high.

Some media also focus on other areas, such as Silicon Valley News, which focuses on analyzing Zhiyun Group's AI technology.

"Zhiyun Group's AI computing power card business, namely the APO series graphics cards and NVIDIA's X series graphics cards, has become a key product that has driven Zhiyun's revenue and profit growth significantly!"

"According to a third-party analysis agency, Zhiyun Group's AI computing power card revenue has reached at least 8 billion US dollars, and its gross profit has exceeded 5 billion US dollars, becoming the fastest-growing profit business of Zhiyun Group!"

"Under the global AI wave, Zhiyun Group has become the only winner!"

"At the same time, Zhiyun Group's AI technologies, such as voice assistants in smart furniture, camera beautification in smartphones, and AI image and video processing in Zhiyun PC products, have significantly enhanced the market competitiveness of Zhiyun's various products."

"At the same time, we can't forget Hailan Automobile, Xu Shenxue's electric car company. The autonomous driving technology they use is also provided by Zhiyun Group's Intelligent Research Institute. Zhiyun Group can get huge fees from Hailan Automobile for licensing this part of technology every year!"

"AI technology has become the key technology that drives the rapid development of Zhiyun Group, and it is also the key technology that drives Zhiyun Group's market value to exceed 800 billion US dollars!"

"While Zhiyun Group is using AI technology to conquer cities and territories, what are we doing?"

"What are our Google, Apple, Microsoft, Facebook, Intel, AMD, Qualcomm and many other high-tech companies doing?"

"Google invests more than $2 billion in AI every year. Where has that money gone? The AI ​​models it has developed so far are still as idiotic as idiots."

"Qualcomm has been talking about AI computing chips for three years, but where is it now? If you guys were a little slower, Tesla would have already developed one on its own."

"And fruit... Stop messing around with your last century voice assistant and start a serious AI team."

"Can AMD please be more careful? They use the most advanced 2nm process to build a $ AI training graphics card, but it doesn't support this or that. The efficiency of training AI is not as high as Nvidia's X-series gaming graphics card, whose X graphics card is only $."

After reading this report, many people in high-tech companies remained silent, and many were even scolded to the point of breaking their defenses.

When a senior Google official was interviewed, he cursed: "What do they know about AI? They are just a bunch of amateur scientists who follow the crowd."

"The complexity of current AI technology is far beyond people's imagination. Our AI team of more than 3 employees has been working day and night on research and development, breaking through one AI technology problem after another. Now the latest G model can perfectly realize most human-computer interactions and has the possibility of commercial application."

“Although our AI technology is still some distance away from Zhiyun, we have narrowed the technology gap from five years to three years. We have made great efforts to achieve this. At the same time, we are also the second company in the world to launch a commercial AI model!”

"They have no right to criticize us for not working hard enough!"

Qualcomm also responded to the report and external doubts: "Our AX project is progressing smoothly. It has been successfully taped out at the beginning of the year and can be used in self-driving cars and other platforms that require high computing power!"

In response to this, someone tagged Tesla's boss Musk on Twitter and asked him why he didn't use Qualcomm's AX computing power platform.

Musk refused to respond!
Only a fool would use Qualcomm's hastily launched AX computing platform, which doesn't even have supporting development software. What's the point of using it...

Now Tesla is honestly using the automotive-grade computing chips from Zhiyun Group, and at the same time is developing its own automotive-grade computing chips. As for Qualcomm, Intel and the like, Musk has long stopped counting on them!

If we rely on them to develop computing chips, Tesla would have gone bankrupt long ago!

As for AMD, it has always been relatively low-key. In the first half of the year, it also launched its own AI training graphics card. In terms of hardware, it actually did quite well.

But unfortunately there is a lack of ecological support...

Behind Zhiyun's APO graphics card is a complete set of ecological support, from software development to various software and even systems running on the server... they have it all.

Now all engineers working on AI are based on Zhiyun's APO ecosystem. Even the artificial intelligence courses offered in schools are about learning Zhiyun's ecosystem software development.

In this context, although AMD's AI training graphics card has been developed, no one uses it...

After all, Zhiyun Group's APO graphics cards are now sold worldwide. They are easy to use and cost-effective. There is no reason for those AI manufacturers to abandon Zhiyun's APO graphics cards and switch to AMD graphics cards!

Just when many media in the United States were hyping up the topic of AI and criticizing Google for not working hard.

Coincidentally, some European media also focused on the AI ​​field of Zhiyun Group for discussion, but... they were more amazed and confused about the future.

After all, the United States still has Google and a large number of other high-tech companies. Although it lags behind Zhiyun Group in the field of AI, it is trying hard to catch up.

But Europe... doesn't even have a chance to catch up.

Let’s not talk about hardware. There are no advanced large-scale semiconductor companies in Europe anyway. Currently, the leader in the storage chip field in Europe is still the German branch of Zhiyun Microelectronics.

Zhiyun Microelectronics has a large-scale storage chip production base in the local area.

Europe has fallen behind in the Internet, consumer electronics, and even semiconductors.

In this situation, facing the development of AI technology which has been very popular in recent years, although we want to follow up, we are unable to do so.

They are all ordinary companies and research institutions that got some graphics cards and made some common AI models.

This has also made many Europeans worried: We have lost semiconductors, missed the Internet, and lost smartphones. Now are we going to miss out on AI technology?

Everyone is working on AI technology, what are we doing?
In fact, not everyone is involved. In fact, only large high-tech companies in China and the United States are working on AI... These days, AI technology is still a very niche high-end technology, and there are no open source projects for everyone to copy.

Therefore, the only companies that can engage in AI are Zhiyun Group, Google and a few other companies that are not short of money... A server array for training AI requires an investment of hundreds of millions of dollars, which ordinary companies really cannot afford.

Many people, and even many companies, are waiting for these big companies to open source their AI models!

Before it is open source, don’t expect to see AI technology flourish everywhere.

However, this time will not be too long.

As time goes by and AI technology develops further, many companies will choose open source in order to develop.

By then, AI technology will become a project that many startups can also work on... After all, taking an open source project and modifying it to create an application project does not require much technical ability or financial support.

(End of this chapter)