Intel Corporation has formed a unique chip venture with two partners in China to help address security issues of imported technology.
Chinese officials called for a reduction in the country's reliance on foreign-made semiconductor, especially those used in systems vulnerable to spies. As a result, there was an arrangement between Tsinghua University and Montage Technology Global Holdings Ltd., aided by over $100 million in research funding from Intel Corp.
According to a statement from Intel, TU will develop a programmable chip placed in a plastic module together with one of its Xeon microprocessors, the most widely utilized calculating engine in corporate and government data centers, China Technology News reported.
The extra chip, a reconfigurable computing processor or RCP, and associated software developed by the university would add capabilities that deal with specific local requirements.
While Intel did not discuss what those requirements might be, Martin Reynolds, a Gartner Inc. analyst briefed on the ventures, pointed out the likelihood that the RCP would help ensure that the Intel chip has no malicious activity.
In 2014, Intel announced its plan to invest $1.5 billion for a 20-percent share in a holding company under the ownership of Tsinghua Unigroup Ltd. that is owned by the university. The company owns two Chinese chip developers.
Meanwhile, The Wall Street Journal reported that Montage, a subsidiary of one of the largest state-owned tech corporations in China, CEC, will commercialize the modules having the two chips from 2017.
Raj Hazra, a vice president in Intel's data-center group, wrote in a blog post, "We believe this new collaboration is a win-win as it enables TU and Montage to innovate alongside standard Intel Xeon processors to create new and compelling indigenous products while preserving the respective intellectual-property ownership of all parties."
Announcement of the venture took place in a ceremony in Beijing. It is now three decades since Intel started operations in China. It has one chip-fabrication facility, which Intel said in Oct. 2015 that it would adapt to commence making memory chips at $5.5 billion.
The Santa Clara, Calif, corporation's most recent statement comes amid increasing concerns about the health of the Chinese economy. Intel echoed the concerns in a forecast released a week ago for the 2016 Q1 that resulted into a sharp decline in its stock price.
However, most analysts hold that any slowdown in the technology purchase of China is likely to impact on personal computers. It is unlikely to have a slowdown in local purchases to expand the capacity of the country's data centers.