Small- to medium-size manufacturers are important to Taiwan's economy, but most of them lack the human resources and cannot afford the expensive equipment and services needed for digital transformation. That is where Analytics-as-a-Service (AaaS) can help them, according to Chien Chen-fu, director for Artificial Intelligence for Intelligent Manufacturing Systems Research Center (AIMS) at National Tsing Hua University.Chien, in a recent interview by Digitimes, explained how AasS is essential for such firms to make flexible decisions and upgrade to smart manufacturing.Q: What is AaaS?A: Manufacturing industries in Taiwan are globally strong. But, with AI and big data analysis as tools, Taiwan-based manufacturers need smart manufacturing, flexible production and smart decision-making. What AaaS provides is algorithms for undertaking digital transformation.For example, TSMC has installed smart manufacturing algorithms on equipment at its wafer fab in Nanjing, China, to completely control manufacturing processes. While large enterprises such as TSMC and AU Optronics (AUO) are capable of establishing their own algorithms for digital transformation, small- to medium-size manufacturers can acquire customized smart manufacturing algorithms from AaaS providers.Q: Taiwan's Ministry of Economic Affairs provides substantial subsidies to government-sponsored organizations to help small- to medium-size manufacturers in digital transformation and smart manufacturing. Why are academics or private consultants still needed?A: Such government-sponsored organizations' help is on a project basis. When the subsidies are used up and the projects expire before the problems in smart manufacturing have been solved, the academics or private consultants can step in, helping address problems such as long-term maintenance of equipment. Therefore, small- to medium-size manufacturers' digital transformation and upgrade to smart manufacturing will eventually rely on private consultants.Q: How is AaaS necessary for smart manufacturing?A: In the electronics sector, Global Unichip and Faraday Technology provide analytical services for small-size IC design houses or companies which need to develop ICs. Even if manufacturers succeed in upgrade to smart manufacturing, they still need AaaS providers for technological maintenance services.Q: How do AaaS providers help small- to medium-size manufacturers? And how can 5G be helpful for Taiwan's smart machinery industry?A: Each AaaS provider has a team of experts separately specializing in IT, stock management, supply chain management, and so forth, and can save companies the trouble of seeking AI and big data analysis talent.Taiwan's manufacturing sectors have rich domain knowledge and experience, which form an advantage for developing software used in smart manufacturing. 5G can lead to faster collection of data. But if there are no algorithms available or existing algorithms are not capable enough, 5G-added value cannot be created.Chien Chen-fu, director for AIMS Photo: Bryan Chuang, Digitimes, November 2020

Less than one year after Mellanox was acquired by Nvidia for US$7 billion, Alon Webman, co-founder of Mellanox, started his second entrepreneurial project. The new company, Chain Reaction, targets the exponential growth to be set off by he calls a "cryptography everywhere" trend. His presentation on Zoom at the first US-Taiwan Startup Forum (UTSF) held in late September generated much interest from various venture capitalists and experts from the blockchain and semiconductor sectors.Blockchain's potential is widely expected. PriceWaterHouse predicts that the application of blockchain will boost global gross domestic product (GDP) by US1.76 trillion by 2030. IDC estimates that blockchain spending will grow at five-year (2018-2023) CAGR of 55.3% for the Asia-Pacific region and 57.1% worldwide, with global spending reaching US$14.4 billion by 2023. Despite the optimism, Webman and Oren Yokev, Chain Reaction co-founder and CTO, foresee some pain points ahead. They told Digitimes that combining the silicon/software engineering capability of their team and Taiwan's high-tech manufacturing supply chain can provide the best solution.Q: Why did you pick blockchain to combine with IC design as your second entrepreneurial project? What is your view toward the blockchain IC industry evolution and requirements?Webman (W): We came from different industries. I came from the high-tech industry, and Oren came from the government institution. But we were classmates some 28 years ago.All of the people who joined the company wanted to experience something they could start from the beginning. I brought in the experience of Mellanox as a startup, but this time in a different vertical, to build something we did not have 20 years ago. Many people who joined Chain Reaction could have decided to retire at this stage of their lives, but we did not feel what we learned over the years was enough. We wanted to take it to a new company, and this time to do it at the front seat, not from the backseat. This is the first thing. I think this goes along with Oren, goes along with Richard (Richard Lu, EVP of Sales and Operations).Richard and Joseph (Joseph Chen, deputy director of Global Supply Management) came from TSMC. And my team has been working with me for many years. We want to work together and enjoy a real new start to bring everything that we've learned in the last 20 years.We want to do something that works and has businesses around. I brought in the IC capability of our team; Oren brought in software, cyber security, and cryptography. And we started to look around different kind of verticals. All of those verticals didn't have two things that are important at the same time: if you go to cyber, you don't have the IC; if you go to networking, you have less security. We think IC, cryptography, security, software, all combined, are important. Blockchain combines them perfectly. But one thing we missed was someone who could help to make sure it would work on an ASIC. We contacted Richard. We brought in the engineering part. Richard brought in the relationships and the experiences in fab, sales, and overall silicon companies around the world.The combination of ASIC, cryptography, and algorithm - and to do it with TSMC's high-volume manufacturing - brings the maximum of the knowledge and experience that Oren, Richard and I have accumulated over the last 20 years.Q: You talked about the trilemma - scalability, privacy/security, and decentralization - of the blockchain industry. Could you explain that and how do your solutions solve those problems?W: You must have decentralization as it is one of blockchain core elements.You need to have security and privacy for your data. You work in the public domain, so you must secure all information and data. If you want the technology for millions of users, you must have scalability. As a silicon company you always want to work in a segment that has the potential for scalability to justify the business. The problem is that today you cannot have all these three elements taken care of at the same time. All the solutions available out there today are software based, and they only touch and optimize one or two of those three elements.We think, by providing efficient cryptography, we can optimize all of them. And we also realize that, if we want to do cryptography the right way, it must be through hardware acceleration. The software running the regular and generic processors available today, whether it's Intel processor or the most efficient graphic processing unit (GPU), are far from being efficient for the specific mathematic computation required for cryptography in order to boost all those three elements of blockchain I mentioned before. Doing decentralization basically means that you have a lot of computers which do the same calculation in parallel. Compared to one centralized computer doing one solution, if you do it with 100 decentralized computers, it takes 100 times of computing power to do the same solution.To do it efficiently and economically, the first step is to reduce the cost overhead coming with decentralization. Accelerating cryptography reduces computation cost of many computers doing the same calculation in parallel. You can use cryptography to improve performance. Performance is measured by two parameters: the number of transactions and the cost. You can use that cryptography to increase the number of transactions per second and reduce the cost, by taking many transactions and signing in with a simple cryptographic signature. The scale in this case is multiplied by the number of transactions you sign together. And last, anytime you make the transactions more efficient, faster, and requiring less resources, you make them cheaper. So that also covers the cost.After covering the decentralization, the number of transactions and the cost, we go into security and privacy. They are both done by cryptography, and both require lots of computing. To combine them with decentralization and scalability, you need to ensure efficiency. As I said, cryptography is the solution. We believe the most efficient and effective way is by far through hardware acceleration. The first solution we see it being 50-100 times more efficient, and the next solution we expect to be more than 1,000 times better.They sound like a big number, but you need to understand that cryptography is very inefficient today. Some operations can take minutes, hours, or even days. A thousand times more efficient will bring you to scale and bring in millions and millions of users in the future.Q: You've been talking about "cryptography everywhere." Any ballpark figure forecast for us?W: Tell you a secret: cryptography is already everywhere in our lives today. When you use your mobile phone, when you use your car, your computer, everything has cryptography. Today there are already some solutions in cryptography that do not require much computing. However, in the future, cryptography will step up into the next level with the privacy and security elements that we talked about in blockchain. To keep your data outside your premises secured and useful, you take cryptography and do analytics on the data while they are still crypted. That way, you can keep the data secured and still enjoy the benefit of your data. We see database everywhere in the future, in cloud service providers and in storage for data that will involve more advanced cryptography.Cryptography is already everywhere, but there will be more. That means you will need stronger computing power. Whether it is centralized or decentralized, cloud providers of services on your computer, mobile phones and cars, all of them require strong computing powers, and we will be able to play in all those verticals.Blockchain is the first area that have scale for us as a company to generate revenues that sustain efforts in other things. But blockchain will be popularized in 3-4 years. Multi-party computation with stronger cryptography will be the next stage, which is expected to happen in 5-7 years. And then we will see V2V communication, which is between cars and everything around them. You do not want anyone to mess around or hack into them. So, security must be strong but efficient. Let us not forget, in 5-10 years, quantum computers will be here. Quantum computers also take up a lot of computing powers. And this just touches the edge of everything. So, you see, cryptography is already here, and there will be much more. We will be able to supply the tools for everyone to use, and that will make Chain Reaction a successful company.Q: What is Oren's contribution in this regard?W: He is the smart guy. He is the one who defines how to do it and put the best solution into product. I am just the guy who tries to sell it.Yokev (Y): We have a lot of smart guys in the company. It is indeed a huge challenge to address the need of data privacy. For example, the COVID-19 situation calls for a lot of data sharing and quick actions. If there is a solution where you can share data but there is no trust between the agencies invovled, it would hurt people and even cause panic. That may be an extreme case, but we see data privacy as a big driver in the future for every cryptography we are doing.The challenge is to take those abstract ideas and very complicated mathematics and then turn them into transistors that run faster and at lower costs. Fortunately, we have a team of experts that can do all the process. We have a new processor architecture that is supportive of all these new ideas and mathematics, providing better solutions in the coming years.W: By the way, our product is called CrPU, Crypto Processor Unit or Chain Reaction Processing Unit. It was Oren's idea. He believes it is the way we should be doing.Q: What is your internationalization plan in terms of recruiting, supply chain management, and customers?W: It's not just for Chain Reaction, but also for others looking to become big and influential companies. You start a small design team usually located in one area. Because this is the easiest path: you work with people you know, and you have to work together. But to be successful, you have to be international and global. This process takes a while; it doesn't happen in one day. You have a product, and then you must sell it. We want to be a company that is all around the world. We are a young company that is 1.5 years old, and already have two offices in Israel, one in Taiwan, and one in the US. I am sure in the next few years, you will see us elsewhere in the world. There are no boundaries as long as we find the right people. Our company is based on the ability of people, and everyone brings to the table something different, whether it's engineering, or supply chain.Taiwan is such a strong technology hub. We are going to manufacture a lot of things in Taiwan, and with Richard's help, we are going to enhance our connections in the US and Taiwan. Certainly, TSMC, the best foundry out there, will be our partner. We will sell it in the US, to Europe, to Middle East, to Far East, and to the emerging markets in South America, etc. There will be no limitations. You will see Chain Reaction products everywhere in the future. We hope to change the world by what we do today.Y: We understand the supply chain is a huge challenge. That is very unusual for an Israeli company to start with a triangle. Many companies do it with the R&D, then sales, and then manufacturing. But we start it rather the opposite. Because of the vision, we know we would need a very strong supply chain and the ability to reach markets globally. Rather unusual, but we believe it's the right path.W: This is what we bring from what we had in the past. In Mellanox we often said, "high-volume manufacturing starts an architecture." If you don't understand that you will never be able to manufacture and to make a difference. We have Richard first communicate with the architecture guys about what to do, before we can enable the production of the products we sell. If it were the architecture guys to tell Richard what to do, we would only end up with great technology, but no revenues, no supply chain - just prototypes. If you think as a big company while you are a startup, and you know how the company should be, you know the next step to emphasize along the growth of the company, then you will be able to overcome the hurdles along the way. We think that the high-volume manufacturing, the connection with TSMC, and the dedicated sales team are the make or break of the company.Q: Do you have a timetable for your products to enter mass production? And what processing technology are you planning to use?W: For the foundry technology, we already know. We are going to use advanced-node processing technology at TSMC. We are going to start with 7nm and 6nm. By the end of 2022 we will already have a 5nm product. We will enjoy the best of what Taiwan's high-tech industry can bring. TSMC is the No. 1 foundry in every aspect. In the first half of 2021, we will have the first solution on top of the cloud, which is still based on our architecture on software. Our first hardware product will be available in the second half of 2021. From there, we will have a continuous line of products.Chain Reaction CEO Alon WebmanChain Reaction CTO Oren YokevPhotos: Company

Abigail Hing Wen is the data-centric tech evangelist and AI podcast host for Intel. Beside her work at Intel, she has multiple identities: a lawyer in venture capital, a leader in emerging AI tech, a New York Times bestseller novelist, a wife and a mother of two. One of her novels, "Loveboat, Taipei," drew from her experience participating in a youth camp in Taiwan more than 20 years ago, and is now being adapted into a Hollywood film.During her recent stay in Taipei as a guest speaker at Anchor Taiwan's "Women in Venture Roundtable," Digitimes had the opportunity to talk to her about her career changes, the prospects of AI, and the potential of Taiwan to become a hotbed for startups.Q: You have been very successful in your career path as a lawyer, but what made you decide to transition into a venture capitalist?A: I started off practicing law in Washington, DC, working for the government. Washington DC is a one-industry town, the practice of law. But my husband was working in technology, he would come to the party, talking about all the latest technology, and everyone thought he was so nerdy. He had always wanted to work in the Silicon Valley, but as soon as we got married, he went with me to New York so I could finish law school, and then to DC, so I could clerk in the DC Circuit. So it was kind of my turn (to sacrifice), and it was a hard move for me. DC was my town as a lawyer, but Silicon Valley is also a one-industry town, his town. My husband is working for Google now. After giving birth to my second child, I stayed home taking care of my kids for three years, and I wrote two novels during that time. After that, I decided I need to go back to law, to continue my training. Because Silicon Valley's bread and butter is technology, I went into venture-capital law. The opportunity came very quickly, I went to the company and loved it. Very soon I out-grew my legal job, the work itself is very easy for me, I closed so many deals very fast. There was one year we counted the number of cases and mine was twice as many as my colleagues'. So I thought, I really need to do something else, because I felt I needed to be challenged more. I started moving more towards the business side of things. Three years ago, I connected with an artificial intelligence (AI) company that Intel acquired for US$400 million. They were building a business unit at Intel, for artificial intelligence. And I joined the office of the CTO in a business role focused on incubating new technologies within a company, versus a venture capitalist investing in tech outside of a company.Q: So how do you structure your portfolio? Do you decide specifically to focus on machine learning, or natural language processing, etc?A: Intel invests very broadly. Its mandate has shifted over the years from strategic to financial investment in startups. As a strategic investor, you want to go ahead of the curve to invest in a company, and think about, where should the company be technology-wise in the next 5-10 years. I specifically asked to do AI work, because I have been interested in that and actually have been writing about it in my novels. I really think it's one of the technologies that changes our future. And I want to be part of that.In terms of what we invest in, it depends on whether we are a strategic or financial investor and what's the best for the company in that space. I worked with Andrew Ng's company, Landing.ai, which is in manufacturing, and we have another one called Datarobot. And there are some startups on the human-resources side in the portfolio. We have another startup venture which was just acquired, focused on denoising speech.You meet so many entrepreneurs, and we have a lot of investors who are constantly cultivating relationships with entrepreneurs. They bring in whatever looks interesting from a financial investor's point of view. AI, for Intel, has some advantage as accelerator. Intel is so big, and so diverse, so it is often driven by interests within the company. In my CTO team, one area we focused on was privacy-preserve machine-learning technologies. Because the future in AI is data, we want to make sure data is processed in a way that protects your privacy, and make technologies that comply with regulations. It is a nexus that combines my legal background and my work with technology.Q: You mentioned you need to look 5-10 years ahead as a strategist. What are the AI technologies that are going to change the way we work, the way we live?A: In my podcast, I interviewed Andrew Ng, who said he tried to find one sector that would not be affected by AI, but he could not. They thought maybe haircuts would not be affected, but actually even haircuts would be disrupted. All of it, everything is going to change. We are already using AI in our cellphones, our home devices. They collect big data in order to analyze trends, across all sectors, including finances, healthcare, etc. AI will accelerate our research in so many different fields. I personally am very interested in the intersections of these technologies, like natural language processing with computer vision, recognition, recommendations. I can actually pull them together on the entertainment side. I am thinking about film tech. But that's more likely to be a 5-year plan, still very early.I have a friend who is doing virtual models. I am fascinated to see how she moves from still images to video. Over time I am excited to see when we can create virtual videos using AI technologies. Right now we do animation, which is like analog in comparison. But we are moving toward virtual humans. Digital Domain and Facebook are just a few companies working on it. That's the holy grail of that space. But we are still at very early stages.I was a beta tester of OpenAI's GPT-3 language model, which is one of the largest language models in existence now. Actually I played off it a bit when I was writing my second book. What I did was putting into a few sentences that I was thinking about writing. It was able to generate text by predicting the next word and the sequences, given all the words that came before it. It is pretty good: it's cogent, the grammar is good, tone actually matches the tone I put into it. If I put in "wealthy family, succession story", it kind of develops a generic story around that. It is useful to me, because it shows me this is how the generic writer might write, so I am not going to write that. But that also reminds me what else I need to include in my own book. There are a number of startups that are springing up around GPT-3, and I think that's going to be very exciting to see what those applications are.Q: But as a writer, are you worried that the AI robots will replace you?A: No, not at all. When I interviewed Jerome Pesenti, the VP of Facebook AI Research, we discussed this topic about AI and creativity. AI is just a tool to enable us to make better art. It's like a camera, which doesn't replace watercolors. Those are two different mediums, but there might be more photographers than watercolorists now. And I think AI is going to be a tool for all art creators. And AI art is being generated out there. Art is like a two-way street. There is the creator and there is the consumer. And the consumer completes the artistic experience. They bring their own experiences to bear. So when people look at a piece of AI-generated art and see meaning in it is because of the experiences they are bringing. The human creativity is what distinguishes us from artificial intelligence, and that is going to be difficult to ever be replaced.Q: You are a podcast host and also an AI evangelist for Intel. We all know that Intel is a B2B semiconductor company. Why does Intel feel it's so important to have an evangelist writing articles and using podcast as a medium to communicate to the public about AI?A: This is me speaking on my own, not representing the company. The vision of the podcast is to help build our thought leadership. We have so many brilliant, incredible scientists and researchers of artificial intelligence at Intel. But they are not very visible. People don't naturally think of Intel as an AI company, because it focuses on the underlying chips. But on AI-related issues like ethics, we do have things to say. I love that platform of Intel, because it's agnostic, it doesn't have an agenda to drive AI, the way that some companies might. That gives me a little bit of flexibility to explore a number of topics. The podcast's emphasis is on a C-suite audience and what I call an "NPR" (National Public Radio) audience. They are smart, informed people who may not know too much about artificial intelligence. But I want to make it accessible to them.And part of the vision is that, I do think AI is going to transform the world. I want as many people as possible to know what is going on. That transparency is actually helpful to build trust in technology.Q: How does Intel create synergy with AI in its products?A: There are many cool technologies, but a lot of them are still in the labs. If we look at the investments Intel has in AI technologies, that would be a good indicator of what they are possibly exploring. And there are a lot of companies that are using Intel chips as the base of their AI, or deep-learning applications. But there are always interesting projects that are incubated around AI. And with the maturity of the technology, there will be more demand for chips and computing power. As Andrew Ng puts it, the "appetite for computing power from the AI revolution is infinite."Q: Earlier you mentioned that the number of companies in Intel's startup investment portfolio has decreased from more than 1,200 to 400+, what was the lesson learned to make that dramatic change?A: No, no, it's more like exits, rather than lesson learned. We had lots of exits over the years - companies get acquired, sometimes they closed. In the startup ecosystem, as a general rule, most startups will fail; but as an investor, you want to make the best bets you can and help the startup company to be successful. The portfolio has gone up and down over the years, usually due to IPO, M&A, or the company folding.Q: But why the turn to financial investment from strategic?A: That's a corporate decision. People recognize that corporate venture capital (CVC) can bring to bear the weight of their expertise, but it does sometimes limit you to companies that have some kind of ties to the larger parent company, like Intel. And the very ambitious investors all want the best deals. You have more options as a financial investor, rather than just strategic.Q: As an investor, do you see Taiwan as a potential hotbed for AI startups in the next 5-10 years?A: I am already very impressed with the tech sphere here. With COVID-19, there are so many COVID refugees coming all over the world to Taiwan. That's an incredible opportunity to create a branch hub for innovation. The universities here are fantastic. Taiwan has almost all the ingredients except for one key thing, which is the uptake for risk, being willing to take big bets, smart bets, but make that seem ok to failure. As I said, not all of Intel's huge portfolio all wins. But that is part of the way you get to your wins.(Editor's note: The Women in Venture series is a collaboration with Digitimes' strategic partner Anchor Taiwan, a platform to connect the world with Taiwan focusing on corporate innovation and cross-border expansion. The Women in Venture Roundtable is a network of 80+ female investors and bi-monthly sessions featuring world-class guest speakers. More info: Anchor Taiwan. For the podcast, see Spotify, Apple Podcast or Soundcloud: https://open.spotify.com/episode/0Dy6TKKLIazz8oaCW0oiiE.)Abigail Hing Wen, data-centric tech evangelist and AI podcast host for IntelPhoto: Micahel Lee, Digitimes, September 2020

ZNT-Richter is a global IT company. In the past 30+ years, ZNT has successfully developed software solutions suitable for the manufacturing industry to help customers improve production processes and product quality.In an interview conducted during the 2020 China International Industry Fair CIIF, Bernhard Marsoner, CEO, ZNT (Zentren fur Neue Technologien GmbH), and Aaron Chou, ZNT's general manager of Greater China, talked about the current pandemic-affected global environment, and prospects and challenges in the field of advanced industrial automation.Q: The term "digitalization" is no stranger to the construction of smart factories. Especially during this epidemic manufacturing companies are facing both challenges and opportunities. How does ZNT help customers to accelerate their digital transformation in manufacturing?A: We see two major challenges. First product life cycles get shorter and shorter. Thus, manufacturing companies are forced to introduce new products quicker while achieving a high-quality production in a shorter time. To achieve this, a lot of data is needed and operator influence on production quality like setting the wrong recipe on a machine or recording wrong data must be eliminated.Second products are supposed to become cheaper while margin shall grow. The only way to achieve this is Smart Manufacturing with a high level of automation. Smart Manufacturing enables for more individualized and stable production while reducing cost and increasing efficiency. Automation drives automatic decisions to eliminate manual errors and provides automated traceability and high data quality with feedback loops to Design. This leads to a closed loop manufacturing approach which in turn speeds up new product introductions.The outbreak of the epidemic at the beginning of this year showed clearly that highly automated lights out factories were by far less affected than factories relying on workers on the shop floor.Since the promotion of industry 4.0 about seven years ago to the promotion of General Factory Automation in China, ZNT helped many customers in the semiconductor, solar energy, electronics, medical device and other high tech industries to adopt ZNT solutions for automating their factory and we still continue to upgrade them. Especially global customers appreciate and benefit from the professional level of ZNT in equipment automation solutions and MES consultant services while assisting them in their digital transformation strategy to introduce Smart Manufacturing.Many customers therefore can't get around implementing a forward looking platform-based solution with the flexibility and convenience of high configurability to speed up their automation process. With our global team we can deliver our projects in time, in budget and in quality.Q: Manufacturers who restarted after the epidemic are bound to face the challenges, including adjust the work patterns, environment and processes to ensure the health and safety of employees. How does ZNT help customers quantifying the benefits of automation and reduce risks after restart?A: Several investigations and analysis conducted within mid to large companies showed that following benefits can be achieved by adopting automation on the whole plant: increase of product quality by 2-5 times, increase of production efficiency by 40-70%, increase of equipment utilization rate by 2-3 times, reduction of production cycle times by 30-60%, and increase of working ability of engineers by 3-35 times.From the perspective of lights out factories, the meaning of automation is to be responsible for replacing human and manual judgment. Through digitalization, informatization and intellectualization, judgment and automatic production are similar to those of auto driving. Therefore, under the general trend of intelligent manufacturing, many harmful factors to human beings in many factories will definitely disappear in intelligent factories.While having less workers on the shop floor and having a system that assigns tasks to workers rather than the other way round, providing a safe environment including social distancing gets far easier. From a central control station you can steer all activities in the factory.Q: The Process Automation Control (PAC) product is a powerful and open platform, which is widely used in semiconductor, photovoltaic, electronic manufacturing, medical device and other high-tech industries. From the field level to the monitoring and analysis level, how to effectively organize, track and seamlessly integrate with the subsystems when facing huge data, ensure the stability of the large-scale machine system operation at the factory side, and effectively reduce the control and management cost? And how to connect big data to collect and analyze production information to obtain the possibility of predictive maintenance and prevention of unexpected downtime?A: We see a clear trend in IT departments responsible for maintaining MES systems in multi-site deployments to move MES to the cloud. From their perspective they can heavily reduce cost in maintaining a single solution deployed to several sites. But from an operational side, especially in automated environments, it is very important that the MES together with automation can be adapted very quickly and is highly available.PAC helps to achieve both while running close to the equipment, similar to edge computing. It allows for data buffering while the connection to the MES is temporarily not available. It reduces traffic due to consolidating and if required aggregating data from the equipment before sending them to other systems. It decouples equipment specific logic form central logic required in the MES. This allows an uninterrupted intercommunication between systems in the intelligent factory, error-free and fully automated. In addition, PAC supports an easy, flexible and quick adaption to new demands while still running the MES in a central environment and reducing the impact of changes to other system to a minimum. The flexible configuration platform allows production to deploy ahead of time and respond quickly. When the production line changes the demand, it allows flexible adjustment, and the work assignment to the equipment is more accurate and in place. With our professional consultants we provide the required advice for architecting and implementing the right software solution.Q: SEMI recently disclosed that the fab equipment expenditures in 2021 will hit a record high of US$70 billion. This is the second time it has revised next year's estimates. It is optimistic that this year's fab equipment expenditures will turn from negative to positive 6% to US$59.6 billion. The advanced manufacturing process of fabs and the heavy investment in the China market will increase by 13% in 2021. China is actively investing in foundry and memory, driving its equipment expenditure to the top in 2020 and 2021. Could you please talk about the future expectation and layout of ZNT in the Greater China market? How do you ensure success in your projects while scaling up your company?A: Under the threat of epidemic situation and the current global economic and political uncertainties it is an indisputable fact that the supply chain established by semiconductor and its related industries is one of the decisive factors. With the rapid development of semiconductor in personal consumer goods, scientific and technological products, automobile components, military science and technology, national defense and military industry, aerospace and aviation, the professional level has been incomparable.In the foreseeable future, the global or Asia Pacific strategic layout will definitely take semiconductor and its supply chain as strategic industries. Therefore, the global layout has always been an important part of ZNT's strategy, while Europe, America and Asia are also different. There is a common ground behind the different layouts, which is sustainable development. Five years ago, it began to grow at a 10% annual growth rate in China. It is estimated that the momentum will continue for a while. Not only in China, but also in the whole Asia Pacific area.ZNT will maintain the position of continuous investment promotion focusing on its strength following this economic global trend. The offices in Singapore, Malaysia and Shanghai are still expanding. For ZNT, customer satisfaction is and remains the number one criterion for success and growth. Therefore, we are not only looking at specific skills of our employees, but also on their ability to take responsibility. Our experience shows that rushing in the design and creating quick and dirty solutions doesn't pay off at the end. The Implementation Methodology we are applying for projects is targeted to create solid and long-term maintainable solutions where the customer even can take over own responsibility through our enablement approach. We do not only fish for our customers, but we teach them how to fish.Q: The level of digitalization of China's industry is only about half that of developed countries such as the United States; and the current "new infrastructure" in China is great significance to the domestic economy. It is planned to adopt a new generation of ICT and 5G technology, to interconnect people, machines, and things, to links of all elements, to improve the entire industry chain efficiency, to accelerate industrial transformation, and promote industrial upgrade. In your opinion, how does ZNT and its partners in the future participate more deeply in the industrial upgrading and transformation of Chinese local market? What kind of enabling role could ZNT play?A: The China Gov new infrastructure strategy has standardized 5G, IoT and other technologies enabling national economic growth. This does not only have an impact on the manufacturing industry, construction industry, science and technology industry, but especially semiconductors and other IT based industries will see more and more demand for software and hardware allowing them to support such strategy.ZNT's PAC platform, partner MES solutions and professional consultants address the need of an accelerated industrial transformation - as we have been doing for more than 30 years now and long before I4.0 and IoT - enabling Chinese local markets to upgrade and grow.With the nationwide coverage of partners, we can provide close local support and service to customers, which does not only improve the service scope, but also the performance of local service with the largest support of flexible customization. At present, in addition to the global cooperation network with Siemens and tight cooperation with Siemens partners, having sales and implementation teams in individual regions is a key goal for us to ensure our continuous support to our valued customers. With this approach and our general company philosophy and outstanding products we are aiming for a very satisfied smile on our customer's faces.ZNT CEO Bernhard MarsonerAaron Chou, ZNT's general manager of Greater ChinaPhotos: Company

While many still believe the US-China tech war will be over along with the end of the US presidential election, most China experts at US think tanks believe it will be difficult for the two superpowers to return to their pre-trade war relationships.Alex Capri, a senior fellow at the National University of Singapore, and a research fellow at the Hinrich Foundation, believes the US-China confrontation will extend from the technology sector - which he describes as ground zero - to other areas. During a recent interview by Digitimes, Capri - a former partner and regional leader at KPMG's Asia Pacific Trade and Customs Practice, and a former international trade specialist with the US Customs - explains what he calls "techno-nationalism" in the US-China disputes and analyzes post-pandemic and post US-election development for the global supply chain.Q: The US-China technology cold war is intensifying. Do you think their confrontation is going to expand to other fronts?A: Yes, I think so. There are strategic industries that will inevitably decouple. It doesn't mean all trade will cease. But there will be significant bifurcation of trade between the US and China around strategically sensitive issues.The technology sector is of course, ground zero. When we talk about industries of the future, foundational and emerging technologies, we will see export controls and weaponization of supply chains on the US side, expand beyond hard technologies such as semiconductors, and focus increasingly on data.How data is extracted, who has access to data, and so on, is exactly what we've seen now with WeChat and TikTok and the Trump administration's executive orders last week. I expect that these executive orders will expand to cover the parent company of WeChat, TenCent, and the BAT - Alibaba, Baidu and Tencent - companies, in general. Any major Chinese digital platform company is now fair game for different kinds of sanctions and controls.There are multiple facets to what I referred to as "techno-nationalism." There is the "national security" element, which involves technology or data and whether it is harvested or used to endanger national security, in some way, or whether it is related to military, defense, or cyber intrusion and cyber security. Whether it is cyber espionage or corporate espionage, theft of IP - all of these things are now directly tied to national security and tethered to the use of technology. Then there is the economic side of techno-nationalism, where countries promote their national champions. From an economic standpoint, this is a mercantilist kind of view of the world. This view is accelerating fragmentation and decoupling in global value chains. The third element of techno-nationalism involves the use of technology to suppress, or promote ideological and political values using different kinds of technologies. For example, how is technology used to protect or infringe data privacy, or, to censor, to suppress information, to conduct surveillance of populations, or to produce fake news - essentially, propaganda. This clash of values is now central to the ideological systems involving China and the US and liberal democracies, in general. How technology is used or may not be used, is going to dictate which business relationships and transactions are acceptable and which ones are restricted. We are seeing this play out through the imposition of export controls, and, more and more, companies being put on restricted entity lists. That is all playing out.Q: Yes, it's essentially the struggle between the different ideological values of China and the US. In Taiwan we are paying much attention to the semiconductor industry. There was a report from Wired, saying that there was a hacker attack on some of the high-tech companies in Taiwan. How valid or credible do you think it is?A: I don't doubt that. Although I don't have specific proof for this. But it is such a strategic industry. It is absolutely vital for the CCP (Chinese Communist Party) to try to catch up, because semiconductors is an Achilles heel for China Inc. There are still no Chinese companies that can produce state-of-the-art microchips. The latest move of the US to close the loopholes regarding the "foreign produced direct product rule" now prevents third parties in overseas jurisdictions from selling semiconductors to Huawei and Hisilicon, if those semiconductors are made with US manufacturing equipment, and/or US software and IP. As you know, TSMC has announced they would no longer supply Huawei and Hisilicon. That scenario, in the future, can potentially hit Alibaba, Tencent and Baidu as well, because their hardware infrastructures also require US semiconductor technology and there are no viable substitutes.Since the trade war began in 2018, there has been an exponential increase in corporate cyber-attacks in virtually all sectors. So, semiconductor industry would be a major target for cyber espionage at this point.Q: Can Alibaba, Tencent and Baidu also be impacted by the export restriction of semiconductors?A: They could be. So far there are still many companies that have not been put on the entity lists, such as SMIC. And certainly Alibaba, Baidu and Tencent are vulnerable. One might ask why the US administration would consider doing that, because these (TikTok and WeChat) are social media platforms, and they have a tiny market share in the US. The argument is: yes, that maybe true, but they are part of the China Inc ecosystem. From the techno-nationalist point of view, it's part of that economic footprint, ideological footprint, and security-risk footprint. Those companies are building cloud, digital infrastructure, and, not to mention that Tencent is building the blockchain infrastructure for the Chinese government for its cryptocurrency, or the e-renminbi. That is a very strategic geopolitical move on the part of Chinese government, as it tries to decouple from the US dollar. Again, in order to achieve much greater financial independence, they will continue to pursue their geopolitical objectives, including making the renminbi the primary currency of international trade with their regional trading partners. This is part of the much greater geopolitical rivalry that's going on, and so any of these companies, from a techno-nationalist standpoint, are vulnerable, and they are fair game for US sanctions and other export controls.Q: You shed light on the Eastern Asian Currency Initiative in your previous paper. It seems lately China has been ramping up speed testing their cryptocurrency. It will soon expand the trial to other major cities in key areas and ready for launch. How soon do you think we will see the decoupling of the e-renminbi and the US dollar?A: That's a difficult one to answer. It's not going to be that easy, because the US dollar is by far still the dominant currency, accounting for more than 60% in central bank reserves all over the world. But a certain group of countries are supportive to China's efforts to move to a digital currency, that would include the Iranians, the Russians and the North Koreans, and, to a lesser extent, EU companies that have become collateral damage to US sanctions against, for example, Russian entities. Essentially any country that would be subject to US sanctions would want an alternative currency. Since the dollar is the primary currency used in most trade, especially commodities, countries like Iran and Russia, which are rich in natural gas and oil, are stuck using the dollar. If they are using the dollar, that transaction can be traced all the way back to the US banking system. And the US government can impose sanctions on those banks, as well as those parties that are involved. So I would answer that Beijing would decouple from the US dollar as quickly as possible. If they are successful, this will further decouple and drive the world into more fragmented trading blocks. And you have to ask, if a trading block is held together with the renminbi, are the values of the Chinese companies going to be pre-dominant? Most likely that would be the case. That brings a very interesting counter measure from the US, that is: does the US government start to promote using Libra or other convertible currency, because it is directly and freely convertible to the US dollar?The other thing that is interesting is that, if one looks at the business model of the BAT companies, they are innovative not because of unique technologies, but because the technologies they are using are ubiquitous and even built on western open-sourced platforms.We are now seeing social media firms in the US starting to adopt models of their (BAT) payment platforms for all kinds of reasons. They kind of encircle their ecosystems, and have more access to their data, and again, this becomes an issue with the digital currency. When every transaction is becoming digital - everything is done with a QR code - that, again, provides power and control to a central government. It's enormous amount of control, and we run into data privacy issues again. Suppression and denial of people's access to a digital monetary system based on social credit scores, so to speak, in that regard we are going to see more fragmentation of the global financial landscape. The liberal democracies of the world will say, "Look, if adopting digital currency means that citizens essentially give up their rights of privacy, or if they choose not to participate in the monetary system they are marginalized to the point that they cannot participate in the economy," I don't see digital currency becoming the only alternative for democracies. I think you will still see a two-track process where you can do all kinds of things with digital cash, but you still have an option to pay in cash. In some ways that may not be a good thing because you can have black markets, criminal organization payment networks, tax evaders etc. But until a system based entirely on digital currency provides or allows for privacy and choice, we are going to see different emergent systems.Q: Yes, essentially it is an ideological value system diversity issue.A: Indeed, and the monetary system is a belief system based on trust and values. But what we are seeing as a game changer right now is the technology. That changes everything.Q: But is it possible for the US government to develop its own digital currency?A: We will see that. In the US, it will not be a government initiative. It will be through public-private partnership. The government will probably encourage Amazon, Google, or the other FAANG companies, to come up with some kind of universal digital currency. There have been talks about the COVID-19 making the US dollar lose some value. But I think in the long run, there is no alternative. For the digital renminbi, maybe you can see the countries along the Belt and Road, emerging countries in central Asia and parts of Africa, adopting it. We are in super early days of mercantilist competition. The US and the West has just woken up. It is like they got slapped a couple of times hard and woke up to this new reality. Now they are going to alter their behavior. We will see a re-orientation to a much more mercantilist system. That is going to lead to a more fragmented global economy - a fragmented Internet, fragmented markets, more localized production, and so forth.Q: As the US is trying to catch up with semiconductor production, and China is of course doing the same for the purpose of meeting its Made-in-China 2025 goals, can there be over-supply in the future? Do you think they will achieve their goal?A: Yes. US semiconductor companies, in terms of revenues and global share, are now a little more than half of the world revenues. So, they are still dominant in that regard. If you look at the value chain of semiconductors, which is broken into research and development, design, foundry, testing, and packaging, 80% of the value is in the design and the manufacturing portion. Most of the US semiconductor industry has outsourced that manufacturing portion, and the biggest percentage of that is with TSMC and UMC. The trade war and COVID, which further exacerbated the techno-nationalist issues we've been discussing, sort of brought that to light. The US government sees it cannot afford to be vulnerable to having such a big portion of semiconductor manufacturing off-shore to Taiwan.We just discussed all kinds of cross-strait tension, cyber-infiltration, the possibility of sabotage, IP theft and so on. The US is committed to reshoring a significant portion of semiconductor manufacturing. That is now underway. We are in very early stages. It is well-known that TSMC has already pledged to build a US$12 billion in Arizona. But beyond that, there is US$30 billion funding in the first tranche in government spending to get production back to the US. That will happen. That happened before. Go back to the 1980s, Japan became the most advanced nation in terms of semiconductor design and manufacturing capabilities. The US responded with a public-private partnership called Sematech. Within 10 years, the US semiconductor industry had leapfrogged. Semiconductor for sure is an industry of strategic importance that is going to be re-shored and re-fenced to a certain degree. Other strategic industries such as pharmaceuticals, will also be re-shored.As for whether the goals of MIC 2025 can be achieved, I think they have miscalculated, and that is a serious example of overreach. China absolutely over-stepped what they were able to. They pronounced this MIC 2025 plan, in which all core industries require semiconductors, and they are a long way from having the capability to produce these semiconductors. And the CCP doubled down and came out with a China Standards 2035, saying that Chinese companies are going to dominate global standards such as 5G. Doing all of these subsequently at the time when militarizing islands in the South China Sea, and imposing national security law at Hong Kong, you couldn't have drawn this up any worse in terms of a foreign policy bungle, given the backlash and the blowbacks we are seeing. So, no. No, I don't think they are going to meet their goals by 2025, not even close, when it comes to semiconductors.But you could look at it another way. This is a 21st century "Sputnik moment" for the United States. And Western Europe is basically saying, "OK, game on!" I would argue, when the US is so paralyzed by its divisive national politics, I can't think of a better way to unite a country, and to come up with a new wave of public-private partnerships, than to name China a new technology and economic rival. This is a new Moon-shot Moment for the West.Q: The Beijing government seems to have done a good job controlling the pandemic and have its economy rebounded from the low, while the US is still in deep water. What can we expect from the future development?A: That is a testimony to the Chinese juggernaut. China has always been good at doing things at scale. They have decades of successful experience in building infrastructure at scale. To see them building those hospitals from ground up in Wuhan, that was an awesome display of autocratic efficiency. No question about that. When the Chinese Communist Party set their eyes on something, they can accomplish a lot. You contrast that to Western liberal democracies, which are, of course, by nature, prone to political paralysis and partisanship. There is, to a large degree, political paralysis like that in the United States. There is no question that liberal democracies have not handled the pandemic anywhere near as efficiently as some technocratic governments in Asia. COVID will provide an interesting lesson going forward, but it would be a huge mistake interpreting it as the validation for the ultimate decline of the United States or the West.There is no question that there will be people in China who look at the United States and say, "These guys can't even manage themselves out of a wet paper bag! Why are we worrying about these guys?" But the real strength of the US will emerge. The US economy and political system is resilient and will survive Donald Trump. It is going to make a comeback and if it needs to reinvent itself, it will. The institutional systems are still sound, and the checks and balances are still working. And you have a wide range of public-private partnerships, which I think will be the key to the 21st century. This is not a top-down, centralized system of government. It's a public-private partnership government, where government plays a supporting and promoting role. But when you throw in the vast US entrepreneurial sector, the open and free market, and the universities, think-tanks and knowledge economy ecosystems, the synergies can be huge.Q: So, no matter who wins in the presidential election, there is no going back for the US-China relations?A: The US-China trajectory would not change with Democrat or Republican winning the election. What will change, of course, if Mr Biden is elected, is a much more organized and articulated policy when it comes to China. That would mean mending fences with allies, and probably building a new coalition to build a new rule-frameworks. We are still at the early, early days with the digital landscape. It requires a new e-WTO, for example. And we also need clearer guidelines around privacy, and all the things we talked about. From a multilateral perspective, we can again see the world fracturing into different blocs, where liberal-democratic countries are members of the multilateral frameworks that promote their own values and non-democratic countries are not going to be a part of that. You cannot separate the application of technologies from those values.Q: But would that mean the production costs for manufactures will go up?A: Yes, invariably there will be instances that represent the Galapagos Syndrome. We probably won't have the same efficiency of markets that we had with fully rationalized, open global value chains. But again, the full global trading system is not sustainable, unless everybody is playing by the rules. And when the world's second largest economy is not playing by the rules, it's not a sustainable system.You have fenced-off ecosystems that are not particularly efficient and could not compete on an international basis if they are left on their own. We saw this happen in Japan in the telecommunications space in the 1990s. Can that happen again? Yes of course. But in a neo-mercantilist world, where it's about the nation state and its interests, or its aligned interests with other nation states around specific values, that's the way it is.

Many tech firms in Taiwan have shown growing interests in working with and investing in startups. But for startups to survive the competition, according to Morgan Lai, a parnter of Silicon Valley-based Foundation Capital, they need strong marketing capability.Lai, who is setting up Formulate Ventures under Foundation Capital, recently talked to Digitimes about why many venture capital funds are shifting their investment strategies, and what it takes for startups to succeed. She also pointed out business opportunities from some latest tech trends.Q: You have been managing enterprise B2B for two years. How do you identify targets for venture capital investment?A: Foundation Capital focuses on various industries with developmental potential. For example, it has invested in Netflix and startup companies engaged in satellite technology. Enteperprise B2B targets companies rather than individuals. We select investment targets by looking at whether they can generate revenues and can grow fast. A criteria for measuring the success of an investment is whether the company can make it to IPO or be acquired at prices several times the initial value. Enterprise B2B mainly focuses on software and finance sectors.You need to have a firm grasp of the macroeconomic trends, then identify the sub-trends through research and analysis, and then list startup firms under each sub-trend from which you can pick your investment targets.A startup for seed-round financing would be valued at US$3-4 million 10 years ago but now the best target is possibly valued at US$25-30 million, nearly 10 times as much. This doesn't necessarily mean present targets are better than those 10 years ago, but because there is too much capital hunting for limited numbers of good investment targets after 10 bullish years in stock markets.The higher valuation means that available funds can invest in fewer startup companies. A 3-year fund used to be able to invest in about 30 startups each year in search of a potential unicorns, but as startups in series A round are now too expensive, there has been a strategic shift to those in earlier stages.Therefore, almost all Silicon Valley-based large venture capital funds, such as Foundation Capital, now focus on startups in the seed round or an earlier stage. I am setting up Formulate Ventures, a fund particularly for venture capital investment in startups in pre-seed or seed stage with Foundation Capital being a shareholder.Successful investment in startups in an early stage hinges on choosing right targets. Five startup companies established by my friends at MIT have seen their corporate valuation expand to the unicorn level of US$1 billion in six years, and this motivated me to set up Formulate Ventures.It is usually difficult to decide on investments in early-stage startups due to relatively limited company information. There are more and more venture capital funds and managers, and the key to staying competitive is to keep doing in-depth market studies in emerging fields and formulate one's own investment strategies.Q: What is your insight into the startup ecosystem in Taiwan? What are your recommendations for Taiwan-based startups planning to tap overseas markets?A: There are three industry sector with large development potential in Taiwan: Semiconductor materials, biomedicine and software infrastructure/cybersecurity.While there were possibly fewer than 10 AI inference IC design houses 10 years ago, there are more than 100 now. Foundation Capital has invested in two of them, Graphcore and Cerebras, with both having R&D collaboration with TSMC.Computing capability of AI inference ICs has been pushed up fast, but there are limitations to computing speed and memory capacity because of the materials used. IC design houses in this area must have innovative solutions in order to survive the competition. We've seen a design house replace crystalline silicon with other materials.For biomedicine, Taiwan has two advantages: its sufficient talent and its abundant centralized data available for use in biomedical AI, plus a well-developed biomedical research ecosystem.Software infrastructure/cybersecurity, unlike software application, does not need to be modified to cater to local markets. Nor does it require intensive capital input. Its therefore suitable for young entrepreneurs.For Taiwan-based startups planning to tap overseas markets and seek venture capital investment abroad, they have to prove that their products or services are marketable in their target markets, and ready strong marketing plans. The founder of the startup must know how to sell the products and services and build a strong marketing team. In the US, it is very important that you can communicate with and convince your clients in the B2B sector. You can't expect your app to sell by just making it available online.Q: COVID-19 has changed what was taken for granted in the past. What is your view of trends in the future?A: There are three interesting trends. The first is remote working. Because of the pandemic, many enterprises need to use cloud computing to allow employees to work at home or remote locations, collaborate or receive training online.The second trend is automation. There have been many B2B automation software products, mostly customized solutions to meet large enterprises' needs, in the US, such as those developed by UiPath and Automation Anywhere. However, small- to medium-size enterprises' demand for automation will emerge. Unlike big companies that need customized automation solutions that have to supported by in-house IT resources for operation and maintenance, SMBs will need new-generation automation software that is not customized and can be operated using notebooks without in-house IT staff.The third trend is B2B automation software for financial teams, such as AI-based automatic cost estimation and forecasting models.(Note: This is part of Women in Venture series, a collaboration with Digitimes strategic partner Anchor Taiwan, a platform to connect the world with Taiwan focusing on corporate innovation and cross-border expansion. The Women in Venture Roundtable is a network of 80+ female investors and bi-monthly sessions featuring world-class guest speakers. More info: Anchor Taiwan.)Foundation Capital partner Morgan LaiPhoto: Michael Lee, Digitimes, July 2020

There are many social networking platforms, but they have been unable to fill the very gap left wide open by the ongoing coronavirus pandemic that has been barring people from face-to-face physical interactions.Virtual reality (VR) may be the best option, enabling interactions almost as real and conveying emotions much better than just words, stickers and voices, according to XRSpace president Sting Tao, who recently talked to Digitimes in an interview.Q: How do you view development of social platforms amid the coronavirus pandemic?A: As the pandemic has separated people and restricted social activities, lack of face-to-face social interactions has made life lonely and uncomfortable despite communication via the phone and messaging apps.Interactions come in various forms: verbal expressions, emojis, and face-to-face physical meetings. More real interactions can lead to more emotional satisfaction.VR technology features immersive experience and along with 5G connectivity, gesture-based operation and technological development of virtual personification (avatar) can bring brand-new experience for social application.Q: In terms of social platforms, what has changed and what remains unchanged?A: Since social platforms are for interactions among people, the ability to convey expressions, emotions and feelings is the core value that cannot be changed. There are different ways of expression enabled by different technologies, but the key is faithful transmision of the messages and feelings.XRSpace thinks that VR bring better experience in emotional exchange and thus will become the technological mainstream in social application. In a bid to keep upgrading its XRSpace Manova, XRSpace has been constantly asking itself: Can our new services meet users' demand? Can the new functions make users feel easy to use and want to use them every day?Q: While other VR platforms focus their applications on entertainment, education, training or industrial purposes, why does XRSpace focus on social networking?A: VR gaming is exciting and VR video is interesting, but such applications lack emotional connection, making VR merely an entertainment tool and commercially a production tool.For emotional connection, VR cannot be used to only entertain individual users and instead has to enable individual users to connect with others.XRSpace Manova enables users to interact with their favorite characters from movies or animations. There can be other virtual scenarios where company managers, fitness coaches, teachers or tour guides can interact with the users.XRSpace has Manova-specific revenues coming from three sources: Sales of Manova hardware; sales of virtual items; sharing of revenues from partners marketing on the Manova platform. XRSpace will develop an online transaction mechanism on Manova for partners to sell online videos, educational courses, and tickets for concerts and sports events, etc. XRSpace will provide tools and management functions to help partners develop software, content and services on Manova.XRSpace president Sting TaoPhoto: Michael Lee, Digitimes, July 2020

Following the release of Flexible Access in 2019, Arm, a subsidiary of SoftBank, is opening up the project to startups with no charge, helping newcomers to reduce costs for product developments. Arm will only begin charging licensing fees from these companies until they begin selling products to make income.To understand more about the project as well as Arm's strategies and planning for 2020, Digitimes recently talked to CK Tseng, president of Arm Taiwan.Q: What's Arm's assessment of the handset market in 2020?A: Arm's IPs and architectures belong to the very top of the upstream supply chain. Arm's incomes from royalties are actually not able to represent the current market status since Arm usually does not collect royalties until after client' begin shipments.Compared to wafer foundries that are able to judge the market's status by their orders, the numbers that Arm has are already rather late.Q: How does Arm see 5G developments this year?A: Judging from its recovery at the moment, the Chinese market will require around three months to get its pace back in 5G deployment. But Europe and North America are currently still being seriously impacted by the coronavirus pandemic and their progresses are difficult to assess.Overall, the worldwide 5G deployment is being undermined by the pandemic, but it remains to be seen how much longer the pandemic will be delaying the 5G development.Q: Will the delay in 5G deployments affect AIoT developments?A: Handsets have seen a dramatic deceleration in shipment growth. As handsets have become a necessary device in our lives, enterprises have been pushing to develop technologies to improve user experience and this trend can be seen from the rising handset pricing.Delays in 5G deployments are unlikely to have a major impact on IoT applications' development, as the next 10 years will be the golden era where key technologies will emerge. With new 5G and AIoT technologies as well as new interfaces, more emerging applications are expected to appear, and there will be more startups woking to satisfy the market's demand.Q: What is Arm's strategy against the deceleration in handset shipment growth?A: Arm has been transforming its businesses in line with changes in demand, but the transformation has been more about technology than business models. However, the company's first business model transformation happened at the end of 2015 when Arm released the fast-track license for the Cortex-M0, allowing its partners to make payment online and download the IP.In 2019, Arm released Flexible Access, allowing developers to access 75% of the company's technological resources including IP, software and technical support. At the end of April 2020, Arm launched Flexible Access for Startups to offer the entrepreneurs critical resources for their tech developments.Flexible Access for Startups allows new companies to gain access to the same 75% of technological resources from Arm without needing to pre-pay license fees.Q: How does Arm profit from Flexible Access for Startups?A: Unlike our traditional licensing system, Arm will not charge any fee for the use of its technological resources before startups are able to begin tape out. Startups may make changes to the product design during the phases from building up prototypes to pilot production, and may shift to other IP architectures to perfect the design. Arm does not begin charging licensing fees from these companies until they are able to generate sales.Flexible Access for Startups has already been activated for a couple of months and attracted several startups to sign up.Q: Does Arm provide any consulting services to the startups?A: Flexible Access for Startups' supporting services are based on clients' needs. Some clients know what solutions they need, while some need advices and analyses from Arm in order to decide the directions for their product designs, technology development, marketing and operation.The solution is offered with the same pricing worldwide.Q: What advantages does the Arm architecture have against x86 and RISC-V?A: Arm is a technology provider and not an end product manufacturer. Such a role gives it a broader perspective, allowing it to develop technologies that support entire systems, accelerating the time-to-market for products and helping establish comprehensive ecosystems.Clients are able to use Arm's resources while conducting R&D, design and manufacturing to shorten time-to-market and reduce costs.Q: How will Arm promote the Flexible Access for Startups? Is Arm providing any other assistance to startups?A: The Flexible Access for Startups program does as much as it can to help startups materialize their ideas. Since startups usually have difficulty finding the right entry point to the ecosystem, Arm will not rule out the possibility of connecting them to others in the ecosystem.Although Arm has eliminated the pre-production licensing fees for startups, these newly formed companies may still go bankrupt before they get to the point of selling their products. Arm hopes more partners in the industry can extend help to these startups.Q: Is Arm's operation being affected by the coronavirus pandemic?A: The pandemic has a major impact on the IT market. Asia had the worst impact in the first quarter, and Europe and North America in the second. End-market demand for IT products is also seeing changes and affecting both the upstream and downstream in the supply chains.When the pandemic is contained, demand will also start to reappear. China, for example, has seen a fast recovery after the outbreak there was put under control, and it is accelerating the establishment of its 5G infrastructure. If Europe and America do not see a second or third wave of the pandemic, they should also see a fast return of demand for end products.Applications such as those for remote study and work have also become new business opportunities for sectors such as systems, network communication, devices and cloud computing platform.Arm Taiwan president CK TsengPhoto: Monica Chen, Digitimes, July 2020

The coronavirus pandemic is driving more companies to embrace digital transformation, but the biggest pain point in the process for many corporate CTOs is the difficulty in assessing the technical capabilities of job seekers through traditional HR recruitment models.Founded three years ago, Terminal 1 Recruitment (T1), a Hong Kong-based startup which has joined the SparkLabs accelerator network, is applying artificial intelligence (AI) technology to disrupt the recruitment process for tech companies. During a recent interview by Digitimes, Edwin Shao, founder and CEO of T1, talked about how AI can help enterprises build a strong technical team to ensure a smooth and successful digital transformation. Edgar Chiu, co-founder and managing partner of SparkLabs Taipei, joined him in the interview.Q: Please tell us about T1 and your motivation for starting this company. How different is your solution from the traditional technology recruitment process?Shao: I started this company three years ago with the goal of helping corporate technology executives find the best software technology talent and address their pain points where it's difficult to assess a job seeker's technical skills through traditional HR processes.Before that, I sold the first company I founded, Kites, to Asia Miles, a Cathay Pacific company, and wanted to build a big data analytics team there. I asked the HR department for help and tried to find the right people through nearly 10 headhunters, but the results were not very satisfactory. So I have found that there is indeed a big demand in the international technology recruitment market that has been unmet because most companies are hardly competent enough to judge whether a technical candidate is suitable for the position he is applying for.When I was building Kites myself, I built a 10-person team from scratch, and the key to the success of this company is finding good people and building strong teams. So by leaving Asia Miles and starting a second business, we believe that we can be the best advisor to the CTOs of companies to help them find the best technical talent with external resources.Q: Is there any special meaning behind the name Terminal 1?Shao: Terminal 1 Recruitment's name comes from a past job change experience, growing up on the East Coast of the United States, working in the San Francisco Bay Area on the West Coast, and starting a business in Hong Kong and Taiwan. Every job change comes with a location move. So when you are in an airport terminal, there are also worries about the unknown and expectations of a new life. The name Terminal 1 Recruitment is an attempt to use the power of AI to break geographical boundaries and do what the headhunter industry has not been able to do in the past, providing engineers from around the world with more opportunities to work abroad, giving them an international stage to meet the challenges and opportunities that match their abilities.Q: What tools or solutions does your platform offer to address customer pain points?Shao: We position ourselves as a full-service technology recruitment and executive search firm, complementing our recruitment consultants with technology tools that combine the best of AI and human services to provide our clients with the best possible service to enhance customer satisfaction. Our platform is categorized by different functions such as software engineer, back-end engineer, R&D engineer, data science analyst, etc.We update the status of the job seeker from the beginning, let the machine learn the job content and requirements of the position listed by the client, and let the machine calculate the job seeker to know which company to pitch the resume to and how to pitch it. It may seem simple, like it's just matching job seekers with clients, but it's actually a very complicated process. We automate the process as much as possible, and each person generates a lot of data that will help improve the accuracy of the matchmaking.Most of our clients are quite demanding, they don't mind paying a higher fee to a better headhunter, but they also want the benefits of technology automation. So we try to combine the strengths of people and technology to create a platform where a job seeker can determine which job openings he or she is best suited for and suggest resumes to those companies as soon as they come in.We have developed a set of test tools, with over 40 tests in total, that allow companies to first give applicant engineers a chance to verify their practical abilities. This set of tests is a project-based design that simulates the problems and scenarios they would actually encounter on a day-to-day basis in the positions they are applying for.I developed this tool because when I was still a corporate executive, I used to test job seekers with existing coding games on the Internet such as HackerRank or Codility, but that only measured their coding ability. However, other abilities such as communication, structure, organizing information, and teamwork are essential to being a good teammate in the daily work.For example, if you're a data analyst, you can't just have machine learning coding skills, you have to know how to download the data needed to solve a problem, how to clean that data, and how to gain insight, how to train machine learning, and finally how to present the results of your work to an officer. So our test will require staff to accomplish all of the above tasks and show us the results at the end. The test results come back, and we provide them to our corporate clients. Currently the customers are very satisfied.This helps the talent we recommend stand out from the crowd of job seekers. For example, three years ago we had a candidate who had just graduated from university and at that time he was offered a job that paid US$18,000 a month, but we thought he was a very good engineer, so we helped him get a better salary, US$35,000, almost double the original. Many times, a resume does not reflect the true strength of a talent, and we hope to overcome this with technology.We also give job seekers some feedback on what they need to add to their abilities and what their strengths are. Such technical advice is hard to get from elsewhere. Even if they don't pass our test, they can go back and strengthen themselves with our advice.Q: So your business model is basically the same as a headhunter, but you're focused on tech talent acquisition.Shao: Yes, we charge just like any headhunter, but we offer better quality of talent and service because we are the only recruiting service that has high tech engineering expertise and can test job seekers on their behalf.We also provide consultancy services such as streamlining the recruitment process, saving our clients valuable time, and ensuring that we find enough quality talent for our clients to review. Customers can also see the progress of the recruitment process in real time from the platform dashboard, a full service that no other company in the market currently offers. We are also happy to work with clients who would like us to license this testing tool to them.Q: What regions and countries are your clients currently located in?Shao: We have clients in Singapore, Canada, the United Kingdom, China and Taiwan who we have already served, and many foreign clients who are willing to assist in applying for a work visa in order to secure talented people.We are able to identify talent worthy of sponsoring visas by our clients and helping them move their families. Because people like that are worth the heavy money the company is paying to move them from overseas.What companies need most is such talent to be the backbone of their IT team. It's our job to find these great techies and help them find the work they truly love.Chiu: There's a huge shortage of tech talent all over the world, not just for startups, but for large companies as well. One of the advantages of T1 is to help the talent and enterprises break down national boundaries so that supply and demand can be met.Shao: Yes, and most international headhunters these days have a branch in each country, and usually don't share information or databases between branches, so they can't see the talent data from another country. Our database, however, is global across borders, and no matter what country a talent is a citizen of, if they are strong enough, the system can help him find the right job. Of course, sometimes there are factors that make it more difficult for foreigners to apply for work visas in certain countries, and the system takes that into account.More and more companies are seeing the value of good engineering talent and understand that such talent is very different from hiring people in operations or marketing. If there is an employee on the operations or marketing team who can't keep up, he won't drag a team down, but on the technology team, it's important to make sure everyone is good enough to do it. In particular, more and more companies are undergoing digital transformation and want to transform into technology companies, they understand that it is not enough to find a "not bad" engineer, they need excellent engineering talent.If one wants to find such talent, relying on the traditional model of having them come into a small room to answer questions will not be enough. Businesses need modern ways to assess the technology talent they need. We have previously helped a logistics company find a very good technical team to successfully help the company achieve its digital transformation goals.Chiu: What we at SparkLabs Taipei have observed is that there are more and more engineers in Taiwan who want to work in Silicon Valley or Southeast Asia, including Singapore. However, more and more companies in these regions are looking to Taiwan to set up IT teams or R&D centers. In addition to an ample supply of technological talent, salaries are very competitive, and the loyalty of employees, quality and speed of Internet connectivity, and quality of information security are all important reasons for these companies to want to come to Taiwan. Therefore, it is a good choice to go through T1 to find a good IT team leader or R&D center manager. They help recruit at all levels, from senior executives to mid-level executives to junior engineers.Shao: We do everything from front-end web or iOS/Android mobile technology engineers, high-frequency trading software or low-latency software engineers, data analysts, back-end C-Sharp/JS, Python/Java architects, or management talent such as managers/technologists at the senior level. In fact, there are already three Silicon Valley executives who have come to Taiwan and want to build their overseas teams here through us. The goodness of Taiwanese talent makes them all want to keep secrets from their opponents. Compared to setting up a technical team in Vietnam or Indonesia, where it's half luck, almost all customers in Taiwan are happy.Q: How has the growth trajectory been over the past three years?Shao: Our annual compounded average growth rate (CAGR) of revenue has been above 200% for the past three years. Although it was not long in the making, we are growing at a very fast pace, although now we are still small compared to some international human resources companies. Our challenge is to establish a standard operating procedure (SOP) to maintain consistent high quality service as the team continues to grow. We also ask our customers to give us their feedback on a quarterly basis as a reference for improvement.We are committed to being a truly global technology talent acquisition company, and unlike other international groups of local companies, we are very interested in understanding the needs of different countries. So we also put a lot of effort into cross-cultural training to ensure that our consultants are able to think differently and understand the thinking of job seekers from different cultures. In addition to identifying technology talent that fits their corporate culture and values, and enabling job seekers to find jobs that fulfill their potential and passion, we also hope to build a deeper and broader talent pool in the next 5-10 years, and use technology to significantly improve the quality of technology talent search.Q: Are you in an A-round or seed round of fundraising?Shao: We should be somewhere in between. We've had revenues from our first year of existence, so there's less need to raise money from outside sources as often as other startups.Chiu: They are currently not short of money, but they are willing to find strategic investors who can drive business growth with them.Shao: I think a strategic investor like that would be a company that would want to use us to give the portfolio companies they invest in a competitive advantage. Many of our satisfied customers are actually startups and keep coming back to us. Therefore, it would be good to talk to their investors, such as venture capital firms, to offer the services of their affiliates and portfolio companies. Sequoia Ventures in the US has its own dedicated recruiting manager to help companies in the portfolio as they expand their teams. We would love to discuss strategic investments with interested companies, or what strategies could be adopted to enable such an ecosystem to grow more rapidly.Q: The next question is for Chiu. Do you have any latest results or plans from SparkLabs to share with our readers?Chiu: Yes, we're pleased to have invested in 18 startups in the last year and three months, and nine of them have been lead investors. T1 is a great example, Edwin has already started his own business, sold his company and started a second time, and still chose to join the global network of SparkLabs accelerators to expand his business.We hope to create a new innovation ecosystem with the companies in our portfolio. We have more than 100 experienced entrepreneurs from Silicon Valley, the UK, Japan, South Korea and Singapore to serve as advisors, with the hope that these new ventures will be successful not only in Taiwan, but also in Asia and the world.T1 CEO Edwin Shao (left) and SparkLabs Taipei co-founder Edgar Chiu (right)Photo: Shihmin Fu, Digitimes, April 2020

Demand for software as a service (SaaS) has been on the rise, highlighted recently by needs for remote working in the wake of the coronavirus outbreak, which has prompted more firms to adopt cloud-based collaborative operations, according to Kdan Mobile Software founder and CEO Kenny Su.In particular, demand for mobile device-based collaborative work software solutions developed by Kdan in the China market has drastically increased from 300,000-400,000 downloads a month usually to a double level of 600,000-800,000 ones.In a recent interview by Digitimes, Su talked about the prospects of SaaS and how his Taiwan-based compnay has expanded overseas.Q: What's the progress of Kdan's overseas expansion?A: Founded in 2009, Kdan is headquartered, along with an R&D center, in Tainan, southern Taiwan, and has its Asia operational center in Taipei. Kdan has set up two operational bases in China, one in Japan and one in the US. Kdan currently has 130 employees in total, 80 of them are in Taiwan.Kdan in April 2018 finished series A funding, raising venture capital of US$5 million from US-based WI Harper Group, Taiwan-based Darwin Venture Management and Japan-based Accord Ventures. In 2019, Kdan set up the operational base in Japan mainly for cooperation with Sourcenext, the largest Japan-based software distributor, to tap the Japanese market.Currently, the US is Kdan's largest market, accounting for 40% of total download volumes and revenues, followed by Europe with 25%, China with 20% and Japan with 5%.Among Kdan's product lines, Document 365 cross-device app for viewing, signing and editing PDF documents, and Creativity 365 cross-device content creation suite consisting of five creation apps are the major sources of sales. Demand for DottedSign, an e-signing service launched in fourth-quarter 2019, is growing fast with over 50,000 downloads and more than 20,000 registered members so far. Most of users have continued use and been willing to pay for the e-signing service.Q: How does Kdan manage employees of different cultural backgrounds?A: Kdan adopts an OKR (objectives and key results) model as used by Google and several international enterprises by setting company's visions and missions as the common goals for employees to strive for. Every employee, including me, lists 3-5 objectives for a certain stage, and these objectives together with what has been done should let the others know to secure transparent internal management. For internal communication, Kdan has set up a Slack-like communication platform across departments and offices for all employees at different locations to communicate via multiple channels for collaboration, with any discussion and talk being transparent.Q: Why did Kdan transform its business model?A: Kdan had originally offered paid apps, but in view of increasing competition, offered app versions with basic functions for free download and those with advanced functions on a chargeable basis. Viewing that Apple and Google had offered subscription schemes, Kdan followed suit in 2015.In addition, Kdan has used a tracking model to ascertain whether users, after free trial use, need advanced functions and are willing to pay. Currently, over 80% of initially trial users have moved on to use chargeable advanced functions.Kdan has extended operation from B2C to B2B 2-3 years ago. Compared with B2C, B2B marketing takes a much longer time, but many enterprise users usually stick to original suppliers. Basically, Kdan provides cloud-based services for small- to medium-size enterprises and licenses customized APIs (application programming interfaces) or SDKs (software development kits) to large-size ones for them to introduce Kdan-developed software to their internal operational processes.Q: What are Kdan's visions and goals in the next 10 years?A: There are many China-based SaaS (software as a service) providers with market values of over CNY10 billion (US$1.43 billion) each, but there are no Taiwan-based SaaS ones. Kdan, with business beginning from the Asia market, aims to become the first Taiwan-based global SaaS company. Kdan plans to tap the Singapore market as a stepping stone into the Southeast Asia market.Global demand for apps from individual and enterprise users is expected to double every 3-5 years along with fast growing digital transformation, and therefore Kdan expects substantial growth in revenues over the next 3-5 years. Kdan currently has 7-8 million monthly active users and has reached more than 200 million downloads from mobile devices cumulatively.In 2020, Kdan aims to obtain ISO 9001 quality management system certification and will hike quality for internal operational process, enhance brand reliability, start series B funding and evaluate feasible targets of mergers.While US-based SaaS brands will remain leaders in terms of global market share, Kdan is confident of reaching larger market shares in Taiwan, Singapore, Japan and other Asian countries.Kdan Mobile Software founder and CEO Kenny SuPhoto: Fu Shih-min, Digitimes, March 2020