Why did Japans semiconductor industry, once the worlds first, decline?

category:Finance
 Why did Japans semiconductor industry, once the worlds first, decline?


Later, however, Japan seemed to be lagging behind.

First of all, DRAM has been mainly used in personal computers (PC), with low performance requirements and cheaper prices. South Koreas Samsung Electronics Company has reduced costs and expanded its market share by investing in large-scale equipment. On the other hand, Intel has entered the field of central processing unit (CPU).

Japanese manufacturers failed to cope with this change and their share of the market declined. Meanwhile, the restructuring of semiconductor manufacturers began in the second half of the 1990s.

In November 2002, Japan Electric Co., Ltd. (NEC) established NEC Electronics Company, and in April 2003 Hitachi Manufacturing Institute and Mitsubishi Electric Co., Ltd. established Reza Technology Company.

In April 2010, after the integration of NEC Electronics and Reza Technologies, Reza Electronics was established. However, a few years later, the company began to perform poorly, from nearly 50,000 employees when it was founded to about 20,000 now. In May 2019, it was reported that 13 factories in Japan and abroad had been suspended for a long time.

In addition, Toshiba Memory, a Toshiba subsidiary that produces flash memory different from DRAM, is placed under the alliance of Japan, the United States and South Korea, which is dominated by American investment funds.

Japanese companies accounted for more than 50% of the integrated circuit (IC) market in the second half of the 1980s and 49% in 1990. But by 2017, the share of Japanese companies had fallen to 7%.

Lack of research capacity in the field of information

Why did this happen?

Two points are often mentioned.

First, technology loss. Samsung Electronics is said to have tapped technicians from Japanese companies with high salaries, or quietly invited them to Korea on weekends to steal the technology of Japanese companies.

Second, Japanese entrepreneurs have failed to make up their minds to implement large-scale investments like Samsung.

These problems do exist. However, it is doubtful to say that these are the fundamental reasons for the decline of Japans semiconductor industry.

If there is no technology loss, and through the decisive decision of Japanese entrepreneurs, Japan is in a leading position in the field of low-cost DRAM. Even so, will it be helpful for the future development of Japans semiconductor industry?

DRAM is not a high-tech product, so emerging countries will one day produce low-cost DRAM products. In that case, Japans semiconductor industry will also decline because of price competition with emerging countries.

In fact, the same thing happened later in the field of liquid crystals. Not only liquid crystal, but also in many areas of manufacturing industry, with the commercialization of products, price competition has intensified.

The real problem with Japans semiconductor industry is that it has not been able to transition to high-tech products such as CPUs. Why do you say that? Because the added value is high, not DRAM, but CPU.

Intel monopolized CPU production through technical force. By cooperating with Microsofts operating system, the architecture of what was later called the Wintel alliance was established, which made it possible to dominate the PC industry.

So why did Japanese semiconductor manufacturers fail to make the transition to CPU production? Thats because basic R&D is not enough.

Semiconductor is known as science industry. Before and after the 1980s, Japan had the basic development power in the field of semiconductors. However, as the core of technology shifts from commodities and materials to information, Japan will find it difficult to cope.

For CPU, it is not only the semiconductor chip hardware itself, but also the software part.

The same thing happens in other areas, such as cameras.

In the transition from film cameras to digital cameras, Japanese camera manufacturers are keeping up with the trend. However, after using smart phones, the most important thing has become to use smart phones to provide artificial intelligence image recognition function.

That is to say, compared with the eye of the camera lens, the brain that processes image information becomes necessary in the later stage. In this area, Japans basic development capacity is obviously backward.

Ultimately, Japans semiconductor industry has fallen behind in the world trend since the 1990s. The fundamental reason is that it lacks the ability to create new things, especially in information-related fields, and it lacks the ability to innovate completely.

Information picture. (Visual China)

The Importance of Basic Education

New technologies can come from businesses, but not entirely. Basic research in universities is also important.

In the 1980s, when American industries were relatively weak, American universities were still strong.

According to the changes of the times, it is very important for the research and education system of universities to be reconstructed and the content to be changed accordingly. That was the source of Intel, and also the source of information technology revolution and artificial intelligence research and development.

So what about Japan? When Japan dominated the world in the semiconductor industry in the 1980s, the academic circles related to it were also powerful. Japanese scholars play a leading role in international semiconductors-related societies.

However, this state of affairs has not been maintained. Since then, Japans research capacity has declined.

It can be proved by the world ranking of the number of papers. In 2018, the National Science Foundation of the United States (NSF) surveyed the worlds scientific and technological trends and distributed the Science and Engineering Indicators survey report, which showed that China ranked first in the world in the number of scientific and technological papers in 2016.

Journal of American News and World Report has also produced a list of world universities by field. In the field of computer science, Chinas Tsinghua University ranked first in the world in 2019. Tokyo University ranks first among Japanese universities, but it ranks 135 in the world rankings.

It can be seen that Japanese universities have not kept up with the development of the world in the most cutting-edge areas, because they can not reconstruct the research and education system according to social changes.

If we stop growing, the reconstruction of universities will not be possible. Therefore, we can not complete the research in the fields needed by the society, nor can the economy grow.

What should we do to change the structure of universities in a society where the economy is not expanding? What kind of mechanism should be established for this purpose?

This is a very difficult subject. But we have to find the answer.

Information picture. (Visual China) Source of this article: Reference News Network Responsible Editor: Wang Xiaowu_NF

Information picture. (Visual China)