Development Law and Enlightenments of Strategic Emerging Industries—Reviewing Development of Tianjin IC Industry and Looking Forward to Tianjin’s AI Industrial Development

Chen Bing

(Tianjin Institutes of Scientific&Technical Information,Tianjin,300011)

Abstract: On the 40th anniversary of the reform and opening-up,this paper reviews the development of Tianjin IC industry, summarizes the development law of strategic emerging industries and its enlightenments,and analyzes the development momentum and demand of AI industries in Tianjin according to the current strategy on the development of AI. Jumping out from the technology aspect, people should strengthen the further understanding of AI,regard peripheral product markets as the crucial part to promote the development of Tianjin AI industry, enhance the capacity of talent resources and talents absorption. Based on the regional secondary development, much efforts should be made in resources development to accelerate the development of military-civilian integration.

Keywords: Artificial Intelligence (AI); IC; Tianjin development; strategic emerging industries;civil-military integration

Introduction

The emerging industry, a new economic sector,came into being with the extensive application of new scientific results and new technology. While the strategic emerging industry enjoys a kind of emerging industries which have important impact on future life and have strategic position as the orientation for new scientific and technological revolution and industrial transformation. And it is a crucial industry that aims to develop new driving force and hold an advantage position in the market competition in the future.After the publishing of “Decision on Accelerating the Cultivation and Development of Strategic Emerging Industries”by the State Council in October 2010,China issued “Development Plan for Strategic Emerging Industries in the 13th Five-year Plan”in December 2016. China attaches great importance to the development of strategic emerging industries,speeds up the development structure of new industry and technology, strives to accelerate the pace of transformation and occupies the commanding heights of a newround economic growth.

Like software industry,integrated circuits(IC or chip) industry is needed to design and develop. As the core of IT industry and the basis of the national economic informatization, integrated circuits industry plays a significant role in strategic emerging industries for more than half a century. That is because it obeys simple formulae such as Moore’s law(performance doubled every 18-24 months) which updates quickly and can be used in manyareas.

Figure 1 Intel Founded in 1968

Artificial Intelligence (AI) also has equal strategic significance for human entering the age of artificial intelligence. China attaches great importance to the changes brought by AI. In July 2017, the CPC Central Committee, the State Council issued the “Development Plan for New Artificial Intelligence”, which has made strategic planning for the development of AI industry.

Compared with IC industry, both the technological system and market system of AI are not mature, and being in the course of initial development. The enlightenments in the process of starting and breakthrough of Tianjin IC industry are worth learning.

1 Review of the Starting Process of Tianjin IC industry

Motorola, the first foreign-owned enterprise in China,settled down in Tianjin and introduced mobile phone into China in 1992. Tianjin has been known for “mobile capital”for many years, and its mobile phone output account for 25%of the country.

Figure 2 Concept Understanding of IC

In fact, as one of the earliest semi-conductor companies, Motorola had two branches in semi-conductor business including analog IC,digital IC, frequency and sensors. It not only brought phone production line into Tianjin, but also introduced many talents who played an important role in the development of IC industries.

As a part of the restructuring Motorola semi-conductor, Freescale was founded in 2004. It developed the semi-conductor related business of Motorola including chips design, package and test,[1]making Tianjin become the first in the output and scale of chip packaging and testing in the world for many years.

Tianjin made efforts to develop chip design business through Motorola, introduced some chip manufactures like Semiconductor Manufacturing International Corporation, and cultivated some enterprises such as Nanda Robust Chip Corporation and Zhonghuan Semiconductor Corporation, so that Tianjin form a complete chain structure in chip design, manufacturing, package, test, materials and equipment. However, competition for emerging industries is heating up. The endogenous driving forces should be enhanced when it flourished to maintain the competitive advantage.

The Tianjin’s comparative advantage in chips is gradually weakened in terms of resources integration and world impact.

2 Enlightenments in the Process of Starting and Breakthrough of Tianjin IC Industry

2.1 The Global Resource Integration Driving Emerging Industries

Tianjin makes full use of mobile phone market and international industrial shift to attract the world's best companies, introduce semi-conductor industry,and form comparative advantage and influence,which cultivated relevant talents for Tianjin and created conditions for accumulate related resources.

2.2 Developing Peripheral Industries Guaranteeing Market Demand of Emerging Industries

The large domestic mobile phone market as well as the global market towards Motorola and Samsung create conditions to guarantee the chip market demand in Tianjin and provide a strong impetus for the initial development of the chip industry. For integrated circuits, mobile phone is peripheral product. Making full use of peripheral industries to enhance the market capacity and absorbing capacity,which is an important guarantee for the development of emerging industries.

2.3 Group Operations Creating Conditions for Development of Emerging Business Sectors

Forty-six CETCs and 8, 357 China Aerospace Science and Industries developed in semi-conductor on the back of group operations demand, and the demand of technology and military technology has provided basic guarantee for the development of chip business, which promotes integrated military and civilian development.

2.4 Forming Endogenous Industrial Momentum for Guaranteeing Sustainable Competitiveness of Emerging Industries

The fierce competition of Emerging industries is reflected in policy environment.Investing enterprises fight over the international titans of industry, which forces the international titans of industry to seek policy support so as to enhance their competitiveness.

3 Demand Analysis of Tianjin AI Development

Currently, AI industry development is still in the initial stage, and its industry structure isn’t formed and economic model is unformed. AI industries of each city and province are in the initial accumulation phase, combined with the current AI industry in the fierce competition and innovation upgrading stage. Therefore, increasing their ecological advantage and characteristic advantage will become the major factor to hold the lead in AI industry.

In recent years, Tianjin attaches great importance to the cooperative work of Beijing-Tianjin-Hebei region, and makes efforts to the construction of the advanced manufacturing bases. Taking the opportunity of the World Congress on Intelligence, the emerging industry of intelligent technology was vigorously promoted by UN Development and Reform Commission, Ministry of Science and Technology, Ministry of Industry and Information Technology, the office internet information, Academy of Sciences, and Academy of Engineering.[2]In December 2017, Tianjin launched“1+10”action plan[3]to accelerate the development of intelligent technology industry. Looking forward to the future, Tianjin is striving to reap the first-mover advantages on the intelligent technology industry, so that it can become the leading area of intelligent technology industry, the source of intelligent technology innovation, and the world intelligent technology innovation center.[4]To achieve this goal is full of challenges, so scientific development is crucial to complying with the law of emerging industries scientific development.

Based on the law and characteristic of the strategic emerging industries in initial and break-through phase, Tianjin can learn some experiences from Tianjin IC industry, and Tianjin AI industry will focus on the following work to achieve leapfrog development and upgrading.

First of all,to have a better understanding of AI industry and its development trend. Whether they can fully explore industrial opportunities and build the industrial ecology in line with local characteristics or not, will depend upon they have a good understanding of connotation and extension of AI industry, market scope, the field of technology,characteristic, predictions of technology and market.Therefore, it is necessary to create the professional team of strategic research so as to ensure Tianjin AI industry open enough, and in line with the Tianjin conditions. The members of the team should do analyze and evaluate the industry development situation and trend, plan and understand the development path and ecological building, and learn the world related resources and market chance. And they should introduce new policies and services to guide the AI industry put forward in an orderly manner.

Furthermore, they should regard the peripheral product market as a breakthrough point to promote the initial development of Tianjin AI industry. AI is widely used in many fields, and its domain of peripheral industry is greatly wide. At present,Tianjin AI industry should enhance the capacity of talent resources and talents absorption in its infancy.They should build a wide AI industrial ecology under the help of peripheral product market. Additionally,preponderant enterprises and scientific research institutions of peripheral industry play a dominant role in extension and development of AI industry,resources introduction and cultivation, and research and development. Based on the current peripheral product market, they should look forward the long-term development opportunity of AI, promote diversification development of AI including the diversification of participants, input and output, and structure and demand of products.

In addition, both the construction of new industry advantage and industry development should be considered. Pursing output scale and cultivating the introduction of corporate champion are important objectives for the development of AI industry,but are not the fundamental goals, like IC industry had advantages both in output scale and enterprise status,but existing some problems in cultivation of sustainable competitive advantages. Tianjin AI industry should foster multi-dimensional industry cluster innovation with high correlation, integrate all advantages including administrative department,industrial park, corporate champion, and industrial cluster to conduct secondary development, increase industrial advantage, promote the ability of fostering the resources advantage of the industry,and enhance the regional influence. Additionally, the regional AI industry resource, market and brand advantages should be built gradually,so that Tianjin AI industry foster some private innovation enterprises with core technology, high integration ability and international competitiveness which can lead the development of industries. Furthermore, the hidden-champion enterprises and Unicorn Company should be cultivated in detail areas of industry.

Lastly, they should accelerate the development of military and civilian integration to facilitate the development and application of the new artificial intelligence. Tianjin has industrial advantages in aerospace and new materials,and the development of local IC industry in Tianjin benefits from the military support. As the most important dual-use technology,AI can be applied widely n defense building and development of armament in the coming decades.The development of AI industry in Tianjin should focus on the social-economical demands especially military demand, strengthen the construction of cooperative innovation mechanism and system, and enhance the development of key technology.Therefore,in order to creates strong industry systematic advantages for AI,the Tianjin AI industry should make full use of military to develop its industries, and build lasting and stable development mechanism of civil-military integration.