Today: Jul 23, 2024

Will this startup break US chip restrictions for China?

7 months ago

In the ongoing technological rivalry between the United States and China, the battle for supremacy in chip technology has become a key focal point. The production of advanced microchips, vital for both economic and military dominance, has led to intense efforts by Washington to control China’s access to crucial microchip design tools. US President Joe Biden took a rather bold step when he decided to unequivocally sever China’s access to high-end computer chips (aka semiconductors) in October last year.

However, an equally serious challenger has now emerged in the form of SEIDA, a Chinese startup founded by a veteran Silicon Valley software executive. Liguo “Recoo” Zhang, the CEO of SEIDA, and three other Chinese-born colleagues left Siemens EDA, a U.S. unit of Siemens AG, aiming to break the foreign monopoly on Optical Proximity Correction (OPC) technology. The OPC tool is indispensable for designing advanced chips crucial for emerging technologies like artificial intelligence and quantum computing.

SEIDA’s objective to “break through the foreign monopoly” has brought scrutiny from both sides of the Pacific, raising questions about compliance with regulations and the potential for intellectual property infringement. Furthermore, SEIDA claims to adhere to both U.S. and Chinese rules, emphasizing a stringent vetting process to avoid intellectual property infringement. While it cannot be ascertained at this point if SEIDA is utilizing proprietary knowledge from Siemens EDA or others given the complexity of OPC technology, neither SEIDA nor its executives have been accused of wrongdoing.

As the U.S. and China race for dominance in chip technology, the interconnected nature of the industry presents challenges for Washington to isolate China economically. While the U.S. still leads in chip design technologies, manufacturing largely occurs in Asia. China too, has been pushing aggressively for advanced chips through programs like “Thousand Talents” and significant government investments. Experts say that the tale of SEIDA is yet another example of Chinese companies leveraging expertise gained abroad to bolster the domestic industry.