It is a big week for the Chinese chip sector. Alibaba has designed a chip said to be the most advanced yet for a local company. The Yitian 710 is an Arm-based semiconductor and the result of many years of investment and research by the Chinese ecommerce giant. Yet the claim that it is a leap towards chip self-sufficiency is overblown.
The new server chip is based on advanced 5-nanometer (nm) technology. Alibaba used architecture by Arm, the UK designer controversially owned by SoftBank. The Japanese tech investor has just as controversially been trying to sell Arm to Nvidia of the US for $40bn
Arm is responsible for market-leading processors, both in terms of cost and power efficiency. Its designs mean lower production costs. The energy efficiency that still gives Arm chips an edge in portable devices also creates an advantage when deployed in today’s huge servers. China has a power shortage. Local governments are approving rate hikes for electricity.