Rebirth 08: Rise from copycat phones

Chapter 428 AI Glasses
As time came to late September, the smartphone industry also ushered in the most intense competition period.

Since Zhiyun Group launched the S17 mobile phone in mid-August, other manufacturers have released mobile phones one after another in the following period.

Zhiyun Group's main competitor, Fruit Company, released Fruit X, Fruit 8 and Fruit 8P in mid-September.
There is nothing new about the Fruit 8. It is just an upgrade of the old model. It is a product of the same concept as the S16 standard version and S16Pro from the previous Zhiyun Group. It continues to use an LCD screen and a fingerprint sensor on the front.

But the Fruit X does use many new technologies, including 3D face recognition, OLED screen, and dual cameras.

They have also upgraded their voice assistant and integrated artificial intelligence... Of course, they will not announce it to the public. The artificial intelligence technology they use is the open source model of generative AI that Zhiyun Group launched in the first half of the year.

From a technical point of view, the Fruit X is quite good, especially the artificial intelligence technology that makes the entire phone more intelligent, a bit like the S17.

The launch of this model has caused a sensation in the local US market... There is no way, consumers in the United States have been looking forward to 15D face recognition mobile phones like Zhiyun S16MAX, S17MAX and now S3 series for more than two years, but they can't buy them!

Now that Apple has finally made a difference and launched a similar mobile phone, they will naturally be tempted to buy it.

In other markets, such as Europe, the Fruit X has also attracted the interest of many old users of Fruit phones.

This phone is undoubtedly a success, but the Fruit X alone cannot support the current share price of the fruit company... After all, this thing is not cheap, and the starting price of 64GB is .

There is also a larger version of the Fruit X MAX, which starts at tens of thousands of yuan.

It competes with the MAX and MAX Pro models in the Zhiyun S series.

For such an expensive mobile phone, although the sales are good, it would be the best if the sales can reach tens of millions of units.

The remaining sales still need to be supported by the lower-priced Fruit 8 and 8P, but unfortunately, these two models have been severely squeezed by the S17 standard version and S17pro version.

Not only was it criticized by consumers, but many analysts were also pessimistic!
It is believed that Apple's entry-level model strategy this year is a huge mistake, which will lead to a continued decline in the total sales of Apple phones.

Analysts have unceremoniously lowered their sales forecast for Apple phones this year once again. One Wall Street analysis firm has lowered its sales forecast for Apple phones this year from 145 million units to 130 million units.

So... a very interesting scene appeared. Apple launched the Fruit X and Fruit X Max, which sold well in the US market and sold well in other markets. However, the Fruit 8 and 8P were indeed not well received.

Finally, the feedback to the capital market was that the fruit company's stock price fell again, and its market value was almost unable to maintain even 500 billion US dollars.

Of course, no matter how miserable the fruit is, it is still the second in the field of smart terminals, and in some areas it has even surpassed Zhiyun and ranked first.

For example, the sales volume of their business notebooks has always been higher than that of Zhiyun Group's business notebooks... No matter how hard Zhiyun Group's PC business department struggles, it cannot get rid of the title of the world's second largest.

As the world's third largest company, Four Star is in an even worse situation... Its various smart terminal products are suppressed by Zhiyun Group and Fruit Company, and there is no hope of turning things around.

This year's four-star Galaxy series has as poor sales as ever, and the strategic goal of achieving sales of 30 million units is still a long way off...

The adverse impact of last year's battery explosion has severely impacted the sales of four-star mobile phones this year.

For example, the market share in the Chinese market has plummeted to only single digits, and is still continuing to plummet. It is estimated that by next year, there will be no four-star brands in the Chinese market.

Other markets have also been impacted to varying degrees.

This is specifically reflected in its flagship Galaxy series.

The S8 phone they released at the beginning of the year had mediocre sales.

In the fall, they released the new generation Noto S8 at the end of August...but it failed to cause market popularity.

How to say it, this phone lacks the necessary highlights!
The new mobile phones released by Zhiyun and Fruit this fall both have 3D facial recognition. Although the technology is quite different and the appearance is also different, they are at least products of the same era... You can tell at a glance that they are high-end products.

As for the four-star Galaxy series, it is hard to see any cutting-edge technology or any major highlights.

Its biggest highlight should be its borderless curved screen design, but that’s all.

The rest are basically nothing special.

Although fingerprint unlocking uses an iris unlocking solution, practice has proved that this unlocking method is unreliable and cannot replace 3D face recognition technology at all. Its practicality is even worse than fingerprint pressing technology.

In addition, it also uses a rear fingerprint unlocking solution, but the rear fingerprint is placed in a relatively upper position, which is not very convenient to use.

As for other hardware, it goes without saying that memory and flash memory chips are Four Star's strengths. They are the ones who make these things themselves, and naturally they use their own top-notch products.

However, in the field of SOC, it lags behind.

Zhiyun's S17 series and Fruit's X series both use chips produced using the latest -nanometer process.

However, Sixin's new phone uses Qualcomm Snapdragon 830 chip, which is manufactured based on Sixin's second-generation nm process technology... Its technical level is probably equivalent to Zhiyun Group's nm process.

This performance gap is quite big!
At the same time, it is also similar to the flagship chips used by other mobile phone brands on the market!

Qualcomm's Snapdragon 830 chip is their main high-end flagship chip this year. Its performance and positioning are similar to those of Zhiyun Semiconductor's W907 chip.

These two chips are widely used by other mobile phone manufacturers besides Zhiyun and Apple.

For example, the Little Blue MAX series from Wecoo Electronics uses the W907 chip, Xiaomi's full-screen flagship and the new generation of Xiaomi digital series also use the W907 chip, and some new flagships from some mobile phone manufacturers such as OV and Zhongxing also use this chip.

The Galaxy series of Samsung, LG's new flagship, and some high-end models of other domestic and foreign manufacturers use Qualcomm Snapdragon 830 chips.

This means popularization... Many consumers will see that the chips are the same, other people’s mobile phones are only two or three thousand, but yours costs five or six thousand... Are you crazy?
To a certain extent, this is also one of the reasons why the sales of the four-star Galaxy series have never increased, as the core component SOC has become homogenized.

Similarly, this is also the reason why Zhiyun Group clearly has the S series SOC, but this SOC series of chips has never been sold to the outside world. Instead, it has specially designed and developed the W series chips for external sale.

What we want is to make our own mobile phone have a unique chip.

In the current mobile phone SOC market, Zhiyun S series is leading the way, followed closely by Fruit A series.

However, the Qualcomm Snapdragon series and the W series exported by Zhiyun Semiconductor are slightly behind by one generation.

For example, the Snapdragon 830, which Qualcomm is promoting this year, is actually a chip produced using Qualcomm's second-generation -nanometer process, and its technical features are similar to Zhiyun's -nanometer process.

Qualcomm originally had the Snapdragon 835 chip based on a -nanometer process, but the problem was that although the chip had been designed, it couldn't find a foundry to manufacture it.

Currently, only Zhiyun Microelectronics and TSMC have ten-nanometer processes in the world.

TSMC's 10-nanometer process production capacity is currently relatively small, and the capacity is currently occupied by fruits. Don't expect to provide capacity to Qualcomm in the next six months.

Not to mention the capacity issue of Zhiyun Microelectronics' 10-nanometer process, even if Qualcomm has sufficient capacity, it is impossible for it to outsource its chips to Zhiyun Microelectronics.

What's more, Zhiyun Microelectronics' own 10-nanometer process production capacity is also tight.

Currently, Zhiyun Microelectronics' 803-nanometer process production capacity is only about 4 pieces per month. Most of the capacity is used to produce S1 chips, and a small part is used to produce the group's own EYQ and the defense general terminal computing platform GF chip.

There is no need to mention the S803 chip, which is a core component of the S17 series of mobile phones and is in great demand.

The EYQ4 series of general-purpose terminal computing chips are mainly used in the group's own robotics business, the automotive business of its sister company HaiLian Automotive, and are also used as comprehensive computing chips in the AI ​​low-altitude drones of its sister company DJI Technology. They are also used to a greater or lesser extent in some other projects, and the overall demand is also very large.

As for the GF1 chip, it is a high-performance terminal general-purpose computing chip designed by Zhiyun Semiconductor, a subsidiary of Zhiyun Group, specifically for the defense field. The computing power of a single chip reaches 120TOPS. It has extremely powerful performance and is equipped with high-specification packaging to meet various extreme working environments with extremely harsh conditions.

The chip is initially planned to be used in a series of mobile weapon terminals based on artificial intelligence technology that are being developed, and can be used in robot dogs and AI swarm drones.

At the same time, multiple chips can be combined into a chip array for use in large equipment such as AI fighters, bombers, unmanned ships, and unmanned combat vehicles.

This type of chip is a general-purpose computing chip and can be used in basically any smart terminal that needs to use artificial intelligence. It can also be used in some special industries, such as the aerospace field, not just in the defense field.

Zhiyun Group's Zhiyun communications satellite and commercial space station plan are planning to use this chip.

This chip is also the first professional chip designed and manufactured specifically for the national defense field and special environments. It has very high technical content... Not only is the design technical content high, but the chip lithography and chip packaging technical content are also very high.

Globally, Zhiyun Semiconductor is the only company that can design such professional chips.

In addition to Zhiyun Microelectronics, TSMC can also produce such chips... Only these two companies currently have chips with an equivalent ten-nanometer process.

However, the computing power of chips using the 10-nanometer process is still a little lacking for the artificial intelligence equipment in the defense field... Even though Zhiyun Group's artificial intelligence technology is very powerful and the underlying artificial intelligence core algorithms developed specifically for mobile terminals are already very efficient and the demand for computing power has been greatly reduced, the chips using the 10-nanometer process are still somewhat lacking.

Therefore, the actual application of GF1 will not be too large, and it will be mostly used in the early testing of many projects. To put it bluntly, this chip and the -nanometer process itself are both transitional processes, and are both transitional chips.

Why are transitional products specially designed and produced? Because this kind of professional chip must be designed and tried first to accumulate some experience before it can be modified. Although the 10-nanometer process is also expensive, it is much cheaper than the 7-nanometer process... If you don't use the 10-nanometer process for testing, it will be more of a loss to use the 7-nanometer process for testing.

The general-purpose computing chip for national defense that will be used on a large scale in the future is actually the GF2 chip that is still under design!

Only after the GF2 chip design is completed and put into production can a large number of artificial intelligence projects with very high confidentiality levels be able to finalize their designs and consider mass production.

Although the numbers between the equivalent 10-nanometer process and the equivalent 7-nanometer process are similar, the actual performance gap is very large.

Zhiyun Microelectronics' equivalent 10-nanometer process has a transistor density of more than 50 million per square millimeter, which is actually not much more than the 14-nanometer process and the 12-nanometer process. Zhiyun Microelectronics' 14-nanometer process can achieve a transistor density of more than 40 million.

Zhiyun Microelectronics' equivalent ten-nanometer process is still an extension of the fourteen-nanometer process, and both are based on the core technology of double exposure.

Zhiyun Microelectronics' technological advancement in this process is mainly reflected in areas such as low-power control and improving chip performance by changing the shape of transistors.

From a more general technical perspective, Zhiyun Group's 14-nanometer process, 12-nanometer process, and 10-nanometer process all belong to the same technology node.

Of course, there is still a big performance gap between them.

Chips using an equivalent 10-nanometer process have much better performance than the first-generation chips using a 14-nanometer process, but they are also more expensive and not very cost-effective.

But... Zhiyun Microelectronics' equivalent seven-nanometer process, which has already completed technical verification, is different. This process has significantly reduced the semi-metal size of transistors in the chip. At the same time, it is combined with many technologies accumulated by Zhiyun Microelectronics before, such as better transistor shape layout, low-power control technology, etc.

Ultimately, the transistor density of this process was increased to 100 million per square millimeter.

The transistor density has doubled... Even if there are no major changes in other aspects, the increase in transistor density alone can bring huge performance improvements.

What's more, the engineers at Zhiyun Microelectronics are not stupid. They will naturally use many other advanced technologies to further improve the performance of this process.

It is precisely because of this gap that Zhiyun Group uses the equivalent of 10-nanometer process as a transitional process and then focuses on the equivalent of 7-nanometer process.

So far, Zhiyun Microelectronics has only invested in the construction of one chip factory with the equivalent of 10-nanometer process. However, there are indeed three factories with the equivalent of 7-nanometer process under construction, with a designed production capacity of 130,000 pieces per month, and the total investment is expected to reach more than 30 billion US dollars.

In addition, most of the planned advanced chip factories will also use EUV lithography machines to produce equivalent seven-nanometer or even five-nanometer chips. The investment amount for this part is even larger, starting at at least US$50 billion.

The reason why so much production capacity is needed is that Zhiyun Group is preparing to use the equivalent of seven nanometers for various next-generation chips, including mobile phone SOC, computer CPU, consumer-grade GPU, server computing chips, terminal computing chips, etc.

By then, the demand for chip production capacity will be huge.

In the past few years, Zhiyun Group bet on the 14-nanometer process and invested heavily in expanding the production capacity of the 14-nanometer process, investing tens of billions of dollars.

Now, the company is betting on the equivalent seven-nanometer/five-nanometer process and is also prepared to invest huge amounts of money. From process research and development to factory construction, the entire plan is expected to cost more than 100 billion US dollars in the two phases.

Looking at this huge investment amount, you will understand why many semiconductor manufacturers have stopped competing in advanced technology...it costs too much and they simply can't sustain it.

However, as the number of competitors decreases, many chip design companies have also encountered trouble, that is, they cannot find suitable foundries.

Especially Qualcomm and AMD, which are neither here nor there... They are currently unable to grab TSMC's 10nm process capacity, and Zhiyun Microelectronics is willing to open up foundry services, but even if they place an order, it will be next year at the earliest. By next year, it is estimated that Sixin's 10nm process will be almost ready.

This year, they will have to endure continuing to use Sixing or Zhiyun's 14nm process or TSMC's 16nm process.

They have no share in the 10-nanometer process, which has affected the chip performance of these chip manufacturers, making it impossible for them to keep up with competitors such as Apple and Zhiyun.

This also further affects the product performance of smart terminal manufacturers that use their chips.

When one thing is linked to another, the impact is huge.

This is also a typical situation where the semiconductor industry directly affects many industrial chains.

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In the smartphone market in September, major manufacturers have shown their talents and released flagship phones one after another. In addition to Zhiyun, Fruit, and Sixing, Weiku Electronics also released the Blueplus 9Max in early September, which uses the W907 chip, under-screen optical fingerprint, and OLED screen.

This model sold very well after it was launched on the market, mainly because it is relatively cheap!

The domestic price of its entry-level model starts at 3,600 yuan, and the high-end model is more than 4,000 yuan. The overall price is much cheaper than that of Fruit, Zhiyun and four-star Galaxy models.

It continues the Little Blue MAX series and continues the strategy of low-priced high-end models… After all, the brand is not as good as others, so it can only play with the price-performance ratio in this way.

However, you can also make a lot of money by taking the path of small profits but quick turnover.

Other mobile phone manufacturers at home and abroad have also released some new mobile phones in September, each of which has its own advantages and disadvantages!

Mobile phone manufacturers that have been able to survive the fierce competition in the mobile phone market in the past few years and achieve sales of tens of millions of units all have some moats of their own, and their comprehensive strength in all aspects is still very strong.

Major manufacturers have released new mobile phones one after another, making the smartphone market very lively in September and sales very high.

However, the most popular one is still Zhiyun Group’s S series mobile phone!

In October, in order to launch a marketing campaign and grab headlines around the world, Zhiyun Group officially announced its mobile phone sales data for the third quarter of this year.

In the three months of July, August and September, Zhiyun Group sold more than 110 million mobile phones, setting a new record for the same period in history.

The third quarter of each year is the period when Zhiyun Group’s mobile phone shipments reach their peak.

During this period, older models will see significant price cuts to boost sales.

At the same time, the newly released S series models will be stocked and then sold out in one go.

At the same time, there will be a buying spree in September.

The combination of many factors leads to the fact that in the third quarter of each year, Zhiyun Group's mobile phone sales often account for about one-third of the annual sales.

And this year you are no exception!

The huge sales volume of over 110 million mobile phones in the third quarter left many competitors speechless... This figure is even several million units higher than last year.

Moreover, the average price of Zhiyun Group's mobile phones this year is much higher than in previous years, which means that Zhiyun Group's mobile phone business revenue and profits will increase further.

On the one hand, the sales share of the MAX and MAX Pro series in the S series increased slightly, which raised the average price of the S series.

On the other hand, Zhiyun Group has started to focus on the SX and SXL series this year to replace the C series, which has continued to decline, thereby significantly increasing the average price of mobile phones...

Many analysts have already predicted that the revenue and profit of Zhiyun Group's mobile phone business this year will probably increase significantly compared to last year.

This year, everyone predicts that sales in the smartphone market will be lower than last year. Although the total market volume has decreased, the sales of Zhiyun phones have not been affected. Instead, the revenue has increased due to the increase in the average price.

This person is so annoying when comparing himself to others!
However, these external reactions did not affect the continued advancement of various business departments within Zhiyun Group.

In early October, Xu Shenxue saw another very good new product.

A new gadget recently developed by the wearable smart device division of Zhiyun Group is AI glasses.

Zhiyun Group's wearable device business department initially only had smart watches, but later it also classified the Bluetooth headset project into wearable devices for unified management, and later developed AR glasses and VR glasses projects.

However, neither of these two glasses projects can be considered successful. The AR project is not very reliable and is useless, so much so that no commercial project has even been launched... There is no point in developing something that will lose money if it is commercialized!
The VR glasses project is actually an early commercial application of the "head-mounted display", a sub-project of the virtual device project team. It is called a wearable device, but it is more like a pure display device that few people will take with them... There is also a cable at the back connecting to a small host.

In short, Zhiyun Group’s attempts in the fields of AR and VR have not been successful.

Subsequently, with the continuous development of artificial intelligence technology, especially the gradual maturity of the group's super-large generative AI, that is, Yun AI technology last year, coupled with the technical foundation in the display and control fields accumulated in the fields of VR and AR glasses.

The Wearable Devices Division has launched a new AI glasses project… This time, we are not going to play with anything virtual or non-virtual, but only focus on extended reality based on artificial intelligence technology, or XR glasses.

To put it simply, it is based on the hardware of the previous smart mirror and is connected to Yun AI. Its main functions are translation, object recognition, navigation and other applications.

The most direct use scenario is translation. The microphone collects the user's or the other party's voice, then translates it, and then sends the result to the display via text.
Such a project is much easier than the previous AR glasses that required everything, or even VR glasses that required local computing.

After more than a year, the wearable device business unit finally came up with a prototype.

Xu Shenxue has always been very interested in these new things. After hearing that AI glasses had been made, he went over to take a look.

(End of this chapter)