Chapter 115: Boiling a Frog in Warm Water

This building in the Hanxi provincial capital covered a considerable area, but it was very low-key and inconspicuous. There was no sign hanging outside, and it seemed they didn't want to attract external attention.

Security was also very tight. Not only were there guards outside the building, but as soon as you entered the main gate, there were security personnel guarding inside. The entire building was installing surveillance technology introduced from abroad seven years ago. It wasn't until they went upstairs that they saw the words "Dongxin Semiconductor" posted on the floor.

The building was still somewhat empty, but there were many professional personnel busy inside, renovating laboratories, moving equipment, etc.

"Is Dongling High-Tech really going to develop chips?!"

Looking at some chip experimental equipment that could be bought domestically, including etching equipment, thin-film deposition equipment, cleaning equipment, etc., which had already begun to be moved into the laboratory, Liu Youguo, a professor at Hanxi Jiaotong University who was now the nominal person in charge of the Joint Laboratory, knew that these things were definitely not cheap. He could also see that Li Dongling had truly made up his mind this time.

Compared to the equipment in Japan and America, these definitely couldn't be considered advanced, and some were even second-hand, but these were already the best equipment Dongxin Semiconductor could buy domestically.

"Japanese Toshiba's chip motherboards have increased prices to Dongling High-Tech by 20%. Dongling High-Tech has contacted companies like NEC, Panasonic, Hitachi, Fujitsu, and Texas Instruments, but these chip companies are all in a wait-and-see state. There are those willing to supply Dongling High-Tech, but the asking price is not low, and even…"

Mentioning this made Li Dongling's teeth itch, but he said helplessly, "Ximen contacted Dongling High-Tech, threatening that they are willing to let their subsidiary, Infineon Semiconductor, provide chips for the three digital cordless telephone models: Shenzhou, Coolpad, and Simon!"

Ximen was clearly kicking them while they were down, blatantly mocking Dongling High-Tech. But Dongling High-Tech really had no way to fight back against the price hikes by those chip manufacturers and Ximen' mockery. If they didn't have them, they didn't have them. These things couldn't appear out of thin air.

"This price increase for Dongling High-Tech will not be the first, nor will it be the last!"

Li Dongling said to Liu Youguo with a heavy expression. He had clearly felt that those foreign companies had begun to target Dongling High-Tech, whether intentionally or unintentionally.

Dongling High-Tech's rapid progress since its establishment, especially the victory against Ximen, had probably been targeted by many giant companies. This parts price increase was probably just a test. The small actions in the future would only become more and more frequent.

Especially after notifying Dongling High-Tech of the price increase, companies like Toshiba immediately announced to other domestic companies that they would not increase prices for them, claiming that the parts price increase for Dongling High-Tech was because Dongling High-Tech's demand for parts was too large, leading to their insufficient production capacity, so they had to raise prices!

The sales volume of the Shenzhou series telephones continued to soar. This month, compared to the previous month, the sales volume had doubled, reaching 2.6 million units. Toshiba and other companies now also had severely insufficient production capacity for chip parts. They had to build new production lines, so they began to raise prices for Dongling High-Tech!

This was like the storage chips of Japan's Toshiba and South Korea's Samsung. As long as they couldn't be produced domestically, they would be in hot water every three days. It wasn't power outages, water outages, floods, or fires. Every time an accident occurred, storage chips would increase in price by 30%, and they were targeted at the mainland—other regions in the world were unaffected…

Dongling High-Tech was just enjoying this treatment in advance. The taste of being targeted was simply too obvious.

Japanese companies like Toshiba, Sharp, and Sony didn't want to see the emergence of an existence that could threaten them in the Asian region, which they regarded as their backyard!

When the news first spread domestically that Dongling High-Tech was being price-hiked by companies like Toshiba, there was some public indignation. Many domestic companies were somewhat worried, fearing that the foreign parts price increase would affect them. After all, many core parts of domestic companies also relied on imports, and Japanese parts were a large part of them. But when companies like Toshiba announced that they would only increase prices for Dongling High-Tech, and especially after they published the global sales volume of the Shenzhou series telephones for the latest month, public opinion changed significantly.

A monthly shipment of 2.6 million Shenzhou series telephones, with revenue soaring to exceed 270 million USD—although the net profit was far from this high, hearing this number still made many domestic companies truly jealous of Dongling High-Tech. Toshiba's move was very vicious, and the division effect was very obvious. Like Qualcomm's strategy against Huawei in his previous life, targeting only one company and then announcing continued supply to other companies, this led to the entire domestic industry being difficult to unite against companies like Toshiba, directly dividing an industry into two camps. The means couldn't be considered very high-level, but the effect was very obvious.

When they saw Shenzhou telephones' revenue, many domestic companies had a significant change in attitude. Expecting them to stand with Dongling High-Tech to resist companies like Toshiba was simply impossible. Some companies even had the idea of wishing companies like Toshiba would increase prices even more, so that Shenzhou telephones would have no profit and withdraw from the market, so they could grab the market!

Now that they couldn't get much support in public opinion, unless Dongling High-Tech was willing to accept its fate and work for foreign companies, or just stay in its own one-acre-three-cents of land domestically, it could only rely on itself to get rid of this predicament.

Listening to the trouble Dongling High-Tech encountered, Liu Youguo also felt a sense of shared bitterness, "I said long ago that those foreign devils are unreliable. They always say it's better to buy than to make. Later, they will regret it!

Those companies that watch Dongling High-Tech's jokes will also be stabbed sooner or later. When it hurts, they will know Dongling High-Tech's current situation!"

"We must develop chips ourselves, otherwise we will always be choked by others," Liu Youguo said indignantly, and then asked Li Dongling with some worry, "What about photolithography machines? The most important thing for developing chips is photolithography machines. Which photolithography machine will Dongxin use?"

"The 45th Research Institute of the Ministry of Machinery and Electronics!"

Li Dongling said, "Dongling High-Tech wants to invite someone to serve as the chief designer of Dongxin Semiconductor, and also wants to relocate the photolithography machine team of the 45th Research Institute to the provincial capital!"

Domestically, there were teams developing photolithography machines, and there was more than one. The step-and-repeat projection photolithography machine developed by Tsinghua University 14 years ago had a level not much different from international mainstream technology.

Of course, this was also related to the fact that chips hadn't reached the leading position in the tech industry in those years. At that time, the Soviet Union was still obsessed with transistor miniaturization.

But the watershed was nine years ago. A large number of foreign chips began to enter the domestic market. The chips produced domestically had worse performance and higher prices than imported ones, so they were naturally abandoned. Without a market, no one would develop them. The R&D team had no money, so they couldn't continue.

At the 45th Research Institute of the Ministry of Machinery and Electronics, the photolithography machine prototype they produced had a level not much different from the photolithography machine developed by the American photolithography machine giant GCA. Compared to the photolithography machines produced by companies like Toshiba and NEC, which were the most advanced at the time, the gap was only seven or eight years, barely considered in the world's first echelon of photolithography machines.

But after that, the 45th Research Institute, which had no R&D funding, became like other research institutes—they started designing washing machines, refrigerators, televisions, etc. As for photolithography machines, there was even less funding for R&D.

"Cooperate with the 45th Research Institute of the Ministry of Machinery and Electronics?!"

Liu Youguo frowned, "Nine years, in the tech industry, is already a technical gap of more than two generations!"

"Is there a better photolithography machine R&D team domestically than the 45th Research Institute, and is there a better R&D team that can be dug over by Dongling High-Tech?!"

Liu Youguo was speechless. Although he didn't want to admit it, it was indeed as Li Dongling said. Domestic photolithography machine R&D teams hadn't actually made much progress in these years and were trapped in the 193nm light source. Not only domestically, but photolithography machine companies and R&D teams all over the world were now trapped here.

Domestically, there were indeed better R&D teams than the 45th Research Institute, such as those led by Tsinghua and the Academy of Sciences. But could those teams be dug over by Dongling High-Tech? Even if they were willing to cooperate, would they listen to Dongling High-Tech at that time? It was estimated that a lot of money would be spent, and Dongling High-Tech wouldn't have any say.

On the contrary, the 45th Research Institute of the Ministry of Machinery and Electronics was better. They had been building the Third Front all along. As long as Dongling High-Tech paid, and through the Pingyang and Hanxi provincial municipal departments, negotiated with the Ministry of Machinery and Electronics and the Electronic Department, there was a great hope of digging the 45th Research Institute's photolithography machine team over. In his previous life, this R&D team was relocated to Shanghai in 2002 to participate in the photolithography machine project.

It could be seen that this R&D team had also been gritting their teeth for R&D all these years. Otherwise, it would be impossible to pull this R&D team over to do technical breakthroughs more than ten years later.

"Currently, Shenzhou telephones and the new products Dongling High-Tech is developing don't have too high requirements for chips. As long as Dongxin Semiconductor can develop products with sufficient performance, it will be enough. Dongling High-Tech is willing to procure them!"

Li Dongling looked at the Dongxin Semiconductor laboratory and said to Liu Youguo. He didn't ask the 45th Research Institute to develop any top-notch photolithography machines; as long as they could meet Dongling High-Tech's current needs, it would be enough.

In a workshop in Liantang, Shenzhen, hanging the BYD sign, Boss Wang was busy improving the production line with more than 20 technical personnel when the workshop door was suddenly knocked.

"Is this BYD Battery Company?"

After Boss Wang opened the workshop door, he saw a person standing outside and looked inside hesitantly.

"This is BYD Company. May I ask who you are?!" Boss Wang immediately pulled the visitor into a lounge built to the side. The conditions weren't very good, but it was definitely better than in the workshop.

"I am Xu Kai from Dongling High-Tech's procurement department," Xu Kai reported his name directly, took out a newspaper, and asked Boss Wang with a serious face, "Can your company really produce batteries that can be recharged twice?!"

(End of chapter) ===== CHAPTER 116 =====

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