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Report Producer: CITIC Securities Industry and City Think Tank - dedicated to sharing quality industry insights, hotspot analysis, and the latest information on related industry development. 20,000 word report, an understanding of how the digital economy can help China's economy to create a new increment! Audio：00:0001:15:15? Tap the audio above to listen to the reading
"The development of the digital economy is the ****same need for scientific and technological innovation and the expansion of domestic demand.
Digital resources are the oil of the 21st century, and the digital economy is the core of the fourth industrial revolution.
What is the digital economy? The digital economy is the main economic form after the agricultural economy and industrial economy, and it is a new economic form that takes data resources as the key element, modern information networks as the main carrier, and the integration and application of information and communication technologies and the digital transformation of all factors as the important driving force, so as to promote greater unity between equity and efficiency. We understand that based on data as a factor of production, China will continue to improve digital production relations and generate new productive forces including digital industrialization and industrial digitization."
Positioning of the digital economy: smooth supply and enrich demand.
On the one hand, digital transformation and making good use of data elements will break the time and space constraints and extend the industrial chain, thus unclogging the economic cycle. The digital economy is characterized by high innovation, strong penetration and wide coverage, which can help economic transformation and reform deepening.
On the other hand, the industrialization of digital and the digitization of industries have created a large amount of economic increment, which is an important component of high-quality development. These include both the booming digital industry centered on the ICT industry, and the large number of digital consumption upgrades such as digital retail and digital payment.
In general, the digital economy is an important part of the dual tasks of technological innovation and expanding domestic demand.
On the one hand, from the perspective of science and technology innovation, digitalization is a core feature of the fourth industrial revolution, matching the national strategy of innovation-driven development:
Frontier research: quantum computation, quantum communication, neural chips, DNA storage. Cross-innovation between information science and basic disciplines such as life science and materials.
"Necklace" breakthroughs: high-end chips, operating systems, key algorithms for artificial intelligence, sensors and other key areas.
Booming development of strategic emerging industries: digital industries such as artificial intelligence, big data, blockchain, cloud computing and network security; and advanced manufacturing industries such as communication equipment and core electronic components.
On the other hand, from the point of view of expanding domestic demand, digital technology will empower agriculture, industry and services, and become an important area for comprehensively promoting consumption and expanding investment space:
Further upgrading and expanding of digital consumption: from the already flourishing e-commerce, mobile payment, online entertainment (games, social networking, video, etc.), gradually to education, medical care, culture and other new life scenes. The evolution of new lifestyle scenarios such as education, healthcare, culture, etc. With the help of digitalization, the inefficiency of service industry is changing.
Digital infrastructure has become an important part of the new infrastructure: the construction of high-speed ubiquitous, integrated, integrated and interconnected, secure and efficient infrastructure. Highlights include: 5G networks, fiber optic communications, IPV6, Internet of Things, and big data centers.
Digital scenarios are rapidly spreading in the social economy, and intelligent and digital transformation is accelerating: there is huge room for industrial digitization. Scenes will be further popularized, including: digital agriculture and industrial IoT, smart cities and digital villages, digital government and digital government, digital logistics and digital trade.
China has already gained a digital competitive advantage, and the digital economy is booming
The size of China's digital economy in 2020 will be nearly 40 trillion yuan, ranking second in the world. Compared with 2005, the size of China's digital economy has doubled 15 times in 15 years, an astonishing rate of growth. Ministry of Industry and Information Technology data released in March 2021 shows that during the "13th Five-Year Plan" period, China's digital economy grew at an average annual rate of more than 16.6%. This is much faster than the average GDP growth rate of 7.4% and more than twice as fast. Therefore, after China's economy has entered the stage of high-quality development, the digital economy has become an economic growth engine that cannot be ignored, and the penetration rate of the digital economy has been increasing. According to the Chinese Academy of Social Sciences, the scale of China's digital economy is expected to reach 45 trillion yuan in 2021, accounting for more than 40% of GDP.
While the digital industrialization is advancing steadily, the digitization of Chinese industries is proceeding smoothly. According to domestic customary classification, the digital economy can be divided into two parts: digital industrialization and industrial digitization. According to Prof. Jiang Xiaojuan's explanation, digital industrialization refers to the industrialized application of digital and related technologies, which mainly includes electronic information manufacturing, telecommunication, software and information technology services, data services, etc. In 2020, the added value of China's core industries in the digital economy accounted for 7.8% of GDP. The so-called industrial digitization refers to the output growth and efficiency enhancement brought about by the application of digital technology in various industries, including digital agriculture, digital manufacturing, digital services, digital integration of the two industries, and a wide range of industrial fields. In terms of proportion, digital industrialization and industrial digitization currently account for about 1/5 and 4/5 of the digital economy respectively.
But objectively speaking, China's digital economy is still big but not strong.
On the one hand, although the scale of China's digital economy is the second largest in the world, according to the 2018-2019 Digital Economy Index, China's score of 36.2 is in the second echelon of the world (ninth), while Germany, the United Kingdom, and the United States are over 40.
On the other hand, the level of development of China's digital economy varies across the country. Beijing and Shanghai's digital economy accounts for more than 50% of the total; Guizhou, Chongqing and Fujian's growth rate in 2020 will be more than 15%. The 14th Five-Year Plan for Digital Development clearly states that the development of China's digital economy also faces a number of problems and challenges: insufficient innovation capacity in key areas, and the situation of the industrial chain and supply chain being constrained by others has not yet been fundamentally changed; the digital divide between different industries, regions and groups has not been effectively bridged, and there is even a tendency to further widen the gap; the scale of data resources is huge, but the value potential is still limited; and the digital economy has not yet reached its full potential. The scale of data resources is huge, but the value potential has not been fully released; the digital economy governance system needs to be further improved.
From the perspective of the "14th Five-Year Plan" goals, China has high expectations for the development of the digital economy
Summarizing, the goals of the "14th Five-Year Plan" for the digital economy basically cover digital industrialization, digital infrastructure, digital transformation of industries, digital government and digital governance, traditional digital consumption, and the development of the digital economy, as well as the development of the digital economy. government and digital governance, traditional digital consumption (e-commerce) and other aspects, reflecting the policy level hope that the full blossom and vigorous development of hope.
The value-added of the core industries of the digital economy (the digital industrialization part) will have to increase from 7.8% of GDP in 2020 to 10% in 2025. Statically, this will require an average annual growth rate of about 5.3%, but considering that the average GDP growth rate during the 14th Five-Year Plan period is also expected to be about 5.3%, it will actually require a growth rate of about 11%, or double the growth rate. Especially in the past decade, China's rapid development of digital industrialization, ICT field of domestic substitution wave, the Internet field born a large number of global giants, the base is not low, so this goal represents China's high hopes for the development of the digital economy.
The five-year target for the number of active IPV6 users has almost doubled. From 460 million in 2020 to 800 million in 2025.
Nearly ten times the five-year target for gigabit broadband subscribers. From 6.4 million in 2020 to 60 million in 2025.
Industrial Internet platform penetration rate over three times in five years. From 14.7% in 2020 to 45% in 2025. The actual growth rate is even faster if you take into account the continued growth in the number of businesses. The number of real users of online government has doubled in five years. From 400 million in 2020 to 800 million in 2025.
National online retail sales and e-commerce transactions will need to grow by 45% and 24%, respectively, over a five-year period. As the world's No. 1 online shopper, China is still setting modest growth targets, with national online retail sales and e-commerce turnover slated to rise from 11.76 trillion yuan and 37.21 trillion yuan in 2020 to 17 trillion yuan and 48 trillion yuan in 2025, respectively.
New Digital Infrastructure, Government Guides Investment Direction, Enterprises Grasp Investment Efforts
New Infrastructure is an Important Handle for the Development of Digital Economy, with a Higher Degree of Marketization
The concept of "New Infrastructure" originated from the Central Economic Work Conference of 2018, and its connotation and extension have been evolving in recent years. The concept of "new infrastructure" first originated from the Central Economic Work Conference in 2018, and its connotation and extension have evolved in recent years.The term "new infrastructure" was first mentioned at the Central Economic Work Conference in December 2018, and the National Development and Reform Commission (NDRC) clarified the scope of the construction of new infrastructure in 2019, which includes three categories, namely, information infrastructure, convergence infrastructure, and innovation infrastructure.In November 2021, the NDRC further clarified the key contents of the new infrastructure. In November 2021, the NDRC further clarified the key contents of the new infrastructure and established the development idea of "accelerating the construction of information infrastructure, steadily developing convergence infrastructure, and appropriately deploying innovation infrastructure ahead of schedule".
The new infrastructure is integrated into the process of digital industrialization and industrial digitization, which is summarized by focusing on two major industry chains: the communication facilities industry chain and the data computing industry chain. From the definition of new infrastructure given by the National Development and Reform Commission (NDRC) in 2019:
1) Information infrastructure mainly includes the three major industries of communication networks, new technologies and arithmetic infrastructure, and specific to the sub-sector, there are typical digital industrialization industries, such as 5G, Internet, blockchain, cloud computing and data centers, i.e., products and services brought by digital technologies; 2) Convergence infrastructure mainly includes intelligent transportation and intelligent energy, i.e., products and services using digital technologies; 2) Convergence infrastructure mainly includes intelligent transportation and intelligent energy. transportation and smart energy, etc., i.e., the use of digital technology to empower traditional industries to improve operational efficiency, which is a typical industrial digitalization behavior; 3) innovation infrastructure includes science and technology, science and education and industrial technology innovation infrastructure, whose mode is similar to the construction of scientific research centers, the construction of colleges and universities and the creation of science and technology industry clusters, and the construction of traditional industrial parks for hi-tech utilities and enterprises to support them and the related infrastructure.
Theoretically, the software application industry in the information infrastructure does not belong to the category of government infrastructure in the traditional theory, and its nature belongs to the "elements" that need to be purchased in the process of transformation of the old infrastructure. Information infrastructure in addition to hardware industry, software class is not strictly speaking a narrow definition of infrastructure. From the traditional definition of infrastructure, infrastructure refers to the social production and residential life to provide public **** service material engineering facilities, is used to ensure that the country or regional social and economic activities carried out normally in the public **** service system. Some industries that favor software applications such as artificial intelligence, cloud computing and blockchain technology are essentially a service that serves to improve the efficiency of the public ****service system, and are not themselves public ****service systems. Converged infrastructure, on the other hand, can be seen as the digital transformation of traditional infrastructure, part of the information infrastructure is a service element that needs to be purchased in the transformation, and the innovation infrastructure is the traditional infrastructure supporting the development of new infrastructure.
From the perspective of the digital economy, the government's side of the direct contribution can be focused on the industries attributed to the concept of traditional infrastructure. Most of the new infrastructure relies on corporate investment, and the government is more of a purchaser:
Part of the digital economy is to supplement traditional infrastructure, such as 5G base stations, data centers, smart computing centers, and other relatively "hard" facilities industry, which is similar to traditional infrastructure, the government can take the lead in initiating investment, but in the actual construction of the Chinese enterprises instead of the government to take on the responsibility of investment. This part is similar to traditional infrastructure, in that the government can lead the investment, but in the actual construction, Chinese enterprises have taken over a large part of the government's responsibilities; the other part is the impetus and support provided in the process of the transformation of traditional infrastructure to new infrastructure, including on the one hand, the relatively "soft" data application service industry, such as artificial intelligence, cloud computing, blockchain, etc., and on the other hand, hardware facilities required for the digital transformation, such as those related to transportation and energy. On the other hand, there are the hardware facilities needed in transportation, energy, etc. for digital transformation. This part of the investment relies more on enterprises' own investment, and the role of the government is mainly to purchase related services and equipment.
The new infrastructure is more market-oriented. In Shenzhen's new infrastructure plan for 2020, for example, 60 percent of the funds come from the market, with government investment accounting for only 40 percent. Traditional infrastructure projects, such as the "iron and public infrastructure," are basically government- or state-led. However, the situation of new infrastructure is different from that of old infrastructure, as it is closely linked to new industries, new forms of business and new products, and directly serves vertical industries such as the manufacturing industry, so new infrastructure projects are operated to a higher degree of marketization. Taking a summary of the 411.6 billion new infrastructure investment projects announced by Shenzhen in July 2020, there are 34 social investment projects with a total investment of 244.7 billion yuan, and 61 government investment projects with a total investment of 167.2 billion yuan. The investment ratio of social investment and government investment is 60/40. From the perspective of project types, there are 28 information infrastructure projects such as 5G networks, satellite communications and arithmetic facilities, with a total investment of 245.2 billion yuan; 42 innovation infrastructure projects such as integrated circuits, 8K ultra-high-definition, and biomedicine, with a total investment of 101.6 billion yuan; and 25 convergence infrastructure projects such as intelligent manufacturing, smart energy and intelligent transportation, with a total investment of 65.1 billion yuan. We believe that by splitting the mainstream investment projects of new infrastructure: the peak of 5G base station construction is in the past, and data centers rely on corporate investment. Although the east counts the west counts for the national strategy, but still need enterprise-led investment.
5G base station: three mobile operators dominate the investment process, the peak of investment is passing
Currently, the domestic 5G base station investment is dominated by the three major operators, the downstream demand growth rate has slowed down, the peak of investment or has passed. Domestic 5G base station as an asset project of the three major operators, its investment is basically entirely by the three major operators. From the perspective of the expected target for 5G base stations put forward in the "14th Five-Year Plan", it requires that the number of 5G base stations per 10,000 people will reach 26 by 2025, which means that a cumulative total of 3.77 million 5G base stations will need to be constructed. By the end of 2021, China had already built 1.425 million base stations, which means that 586,000 5G base stations will need to be built annually in the next 2022-2025, and more than 670,000 new base stations are expected to be built in 2022, judging from the targets set by the three major carriers this year.
Data center: still the enterprise's own investment behavior is dominated by the local government to provide land, finance and tax support
According to the arithmetic form of classification, the data center can be divided into supercomputing, general intelligence computing and edge computing power. For a long time, China's data centers have been dominated by general computing power, supercomputing, intelligent computing and edge data center applications and the number of applications to be increased. Currently, general-purpose computing power is the main force of data centers, accounting for more than 90% according to the rack size; supercomputing centers are mainly used in national key scientific research fields, with fewer commercial scenarios; the existing scale of smart computing centers does not account for a high proportion, and the demand for edge data centers will be further boosted with the acceleration of China's digital transformation. (Report source: Future Think Tank)
The proportion of government investment in supercomputing centers, which accounts for a relatively low proportion of the total, is instead higher
Investment in supercomputing centers relies on the government's willingness, the guarantee of national funds, and the technological support of enterprises. From international experience, the construction and operation resources of supercomputing centers basically come from the government, and the operation and management modes can be differentiated into the direct government subordination system represented by the United States and the shareholding system represented by Europe. The development of supercomputing centers in China is based on the planning of supercomputer development in the "863" support program of the Ministry of Science and Technology of the People's Republic of China (MOST), and the development of mainframe computers is based on the cooperation agreements signed by manufacturers and ministries and commissions of various provinces. In terms of financial guarantee, the Ministry of Science and Technology through the "863" special funds to support the host R & D vendors to carry out host R & D investment, the local government needs to bear the subsequent operation and maintenance of financial security. Technical aspects of the National Defense University, Dawning Group, Jiangnan Institute of Computing and Wave Group to ensure the performance of China's supercomputers.
Local supercomputing centers are invested by local governments, and part of the funding comes from special bonds. 2020 Shandong Province special bonds (fourteen) raised 200 million yuan to support the construction of the Jinan Supercomputing Center project, 912 million yuan of project capital, and 1.493 billion yuan of other forms of financing.
Only the capital city supercomputing center project will take the income from computing and storage resources during the operation period as the source of debt repayment, and the remaining two projects will take the income from renting and selling properties such as factory buildings and office buildings as the source of repayment. The fund-raising construction plan does not highlight the features and advantages of the data center project, showing that the current project subject lacks judgment on the business prospects, a situation that is relatively common across the country, and which is also the most prominent problem for local governments in preparing for the construction of local government data centers.
Ninety percent of the general-purpose centers rely mainly on corporate input
The overall investment in general-purpose data centers is based on market input, supporting the participation of diversified subjects in the construction, with the government acting as an auxiliary and guide. According to the Guangzhou data center construction and development guidance, construction guidelines and green data center evaluation standards, we must adhere to the data center to market investment, support the participation of multiple subjects in the construction, integration of land, power, network, energy consumption indicators and other resources, rational layout and construction of various types of data centers, optimization of data center stock resources. The parts that the government can support for general data centers include the following:
1) Land, loan and energy consumption index: the central government and documents across the country have emphasized that local governments should improve supporting land, loan and energy consumption policies. Jiangsu Province, in its Several Policy Measures on Accelerating the Construction of New Information Infrastructure and Expanding Information Consumption, proposes to guarantee quotas for land and energy-consumption indicators, and to promote the switching of power supply to direct power supply. Inner Mongolia in the "Inner Mongolia Autonomous Region to promote the development and application of big data in a number of policies" for the construction of the autonomous region to invest more than 1 billion yuan in the data center project, involving the state-owned land use right transfer proceeds, in accordance with the provisions of the land transfer proceeds after the accrual of a variety of special funds of the alliance city, the flag county (city, county, district) retained portion of the project for the purpose of supporting the construction of the project.
2) electricity preferential: Shandong Province in the "Shandong Province to support the development of the data economy," the views of the eligible types of data centers, disaster recovery centers, supercomputing centers, communications base stations, etc., the implementation of industrial and commercial and other electricity prices in the two-part system of electricity prices. In line with the planning layout, service province and even the national regional and industrial data centers, the price of electricity in the 0.65 yuan / kWh on the basis of halving, through all levels of financial incentives and other ways down to about 0.33 yuan. According to the actual power consumption and industry-driven role, graded and graded support.
3) guide the layout: Hebei, for example, the document requires the optimization of the layout and construction of Internet data centers (IDC), to guide the ultra-large, disaster recovery data centers to Zhangjiakou, Chengde and other energy, climate advantages of the region to gather, low-latency, high-bandwidth-based large and medium-sized data centers moderately to the development of Shijiazhuang, Langfang and other regions. From the national planning point of view, the current east counts west counts to encourage a large number of digital economy enterprises engaged in data storage, offline data analysis and other businesses to deploy data centers in the western region or purchase cloud services from data centers in the western region to effectively reduce operating costs. Shanghai in terms of energy saving put forward inventory transformation data center PUE no higher than 1.4, new data center PUE limited to 1.3 below.
Data center construction still relies mainly on corporate investment, and local governments have relaxed investment incentives to attract data center investment. Currently, data center operators in China can be divided into basic telecom operators represented by China Telecom and China Mobile, and third-party data center operators represented by Equinix, Digital Reality Trust, and World Wide Data. At present, basic telecom operators and third-party data center operators are relying on the advantages of resources, capital, and technology R&D to accelerate the layout of data centers globally by cultivating their own brands, expanding international marketing channels, and providing a full range of complementary data center services. As analyzed earlier, data center as a new infrastructure is characterized by a high degree of market-oriented operation, and what the government can do in the investment process is to provide factors of production to give preferential conditions to attract vendors to invest in data centers.
East counts west counts: typical market-led new infrastructure plan, the government actively cooperate and guide
East counts west counts the national level of data center industry planning. From the planning point of view, with the previous South-to-North Water Transfer, West-to-East Gas Transmission, West-to-East Electricity Transmission ideas similar to the national guidance to drive the rational allocation of resources across the region. 17 February, the National Development and Reform Commission, the Central Office of the Internet Information Office, the Ministry of Industry and Information Technology, the National Energy Board jointly issued a notice agreeing to the Beijing-Tianjin-Hebei, the Yangtze River Delta, Guangdong-Hong Kong-Macao Greater Bay Area, Chengdu-Chongqing, Inner Mongolia, Guizhou, Gansu, Ningxia and other 8 places to start building the National Computing Power Hub Node
The western region has a cost advantage over the east, while the green power supply can reasonably complement the data center industry. The degree of economic development in the west is still at a relatively low level, and there is plenty of room for future development. Data center as a high energy-consuming industry, power costs account for more than 50% of the operating costs of data centers, so data centers in the country's energy consumption under the requirements of dual-control difficult to vigorously expand their business in the eastern first-tier cities, while the western region there is a surplus of new energy power to consume the difficult problems, "East counts west counts" plan with its lower land and energy use The "Eastern Digital and Western Computing" program with its lower land and energy prices can bring a win-win situation for data centers and green power enterprises in the west. In addition to cost and energy consumption, the project also takes into account the need to support economically backward regions, which are expected to foster labor-intensive industries such as back-office processing and offline analysis.
The core objectives of the EWC: green, efficient, technological innovation, and regionally balanced multifaceted progress. This is very clear in the "Guiding Opinions on Accelerating the Construction of a Nationally Integrated Big Data Center Collaborative Innovation System": by 2025, data centers nationwide will form an integrated infrastructure pattern with a reasonable layout and green intensification; data centers in the east and west will achieve a structural balance, and the efficiency of power utilization for the operation of large-scale and super-large data centers will drop to less than 1.3; and the data centers will be intensive and scaled up, The level of data center intensification, scaling, and greening has been significantly improved, and the utilization rate has been significantly increased; the public **** cloud service system has been initially formed, and the cost of acquiring arithmetic power for the whole society has been significantly reduced; the data barriers between government departments and enterprises have been further broken down, and the vitality of the circulation of data resources has been significantly strengthened; the effect of the synergistic application of big data has been highlighted, and a batch of industrial and urban data brains have been formed nationwide. The situation of efficient transformation has basically taken shape, and the data security guarantee capacity has been steadily improved.
Under the background of east counts west counts, the investment mode of data center will be changed to a joint venture of local government and data center enterprises to set up a data center industrial park, and the role of the government may be limited. "As a national-level plan, the future data center investment model will shift from self-built/leased buildings to joint ventures to build data center industrial parks/bases, with local governments providing land, energy, and other approval facilities. In terms of industrial ecology, the data center industrial park/base set up by the local government attracts investment around the upstream and downstream of the data center industry chain to create a data center industry cluster. The core equipment in the data center industrial park still needs to rely on the investment of the resident enterprises, the role of the central government is to provide policy direction guidance, the role of the local government is to provide land and energy indicators and loan facilities, network transmission infrastructure construction and reasonable planning to form an industrial ecological cluster to drive the development of the resident enterprises.
With the South-to-North Water Diversion, West-to-East Gas Transmission, West-to-East Electricity Transmission, Three Gorges Construction and other major national plans similar to the East counts on the landing of the need for enterprises to take the lead in investment and financing.
The scale of investment in the South-to-North Water Diversion Project is about 500 billion yuan, and at the beginning of the launch relied on the central budget funds and syndicated loans from state-owned banks, and made use of the long-term construction of special bonds in 2003. 2020 South-to-North Water Diversion Group was formally set up, and is responsible for the preliminary work of South-to-North Water Diversion Project, fund-raising, development, construction and operation and management, and is responsible for the South-to-North Water Diversion Project safety, operation and water supply safety, and financing the subsequent projects. and water supply safety, and financing investment in the construction of subsequent projects.
The Three Gorges Project on the Yangtze River has created the "Three Gorges Model". Three gorges project overall construction capital of more than 200 billion yuan, at the beginning of the plan, the investment and financing program established as follows: the first part is the gezhouba power plant profits, about 600 million yuan a year, three gorges project in 2003 after the start of power generation profits will also be the three gorges project as a capital investment; the second part of the three gorges fund, in the national electricity, per kilowatt-hour increase in the price of electricity, 4% to 8%, the income of nearly 4 billion yuan a year; the third part of commercial bank loans and the purchase of foreign equipment to take advantage of the three gorges project. The third part is commercial bank loans and buyer's credit for the purchase of foreign equipment, of which foreign credit is more than one billion U.S. dollars; the fourth part is the issuance of bonds, the Three Gorges Corporation has so far issued a total of five issues of corporate bonds for the community, *** to raise funds of 14 billion yuan; the fifth part of the funds from the Yangtze River Power IPO, equity financing.
The two phases of the West-to-East Natural Gas Transmission Project, with a combined investment of more than 300 billion yuan, were led by central enterprises such as China National Petroleum Corporation (CNPC) and China Petrochemical Corporation (Sinopec), which carried out the investment and financing activities, and subsequently introduced collective insurance investment twice, in 2012 and 2013.
The National Pipeline Network Corporation (NPNC), which was formally established in 2019, is responsible for the investment, construction, and operation of the mainline oil and gas pipeline network and infrastructure for gas storage and peaking, and the interconnection and integration with social pipelines. It is responsible for interconnecting the trunk pipeline network and connecting it with social pipelines, as well as the operation and scheduling of the national oil and gas pipeline network.
The investment scale of the West-to-East Electricity Transmission Project exceeds 500 billion yuan, with the State Grid, the Southern Power Grid and other centralized enterprises taking the lead in investment and financing activities. Investments such as extra-high voltage and large energy bases are also invested by major central enterprises for bidding and construction.
The policy significance lies in the fact that the guiding plan is not in person. The innovation of the East West Computing is that the investment market-oriented factors will be more prominent in the future, including central enterprises, local state-owned enterprises, large Internet companies and other types of enterprises will be around the "East West Computing" policy direction to strengthen the construction. In the past, the investment layout of the data center is mainly based on user demand and local factors. Enterprises mainly make their own decisions based on market behavior, which is easy to be disorganized and not conducive to the deployment of resources and effective allocation. After the introduction of "East Counts West Counts", new data centers will be laid out according to the policy direction as much as possible. The current construction of data centers are mainly self-built and leased two major modes, the launch of the East-West Computing to form industrial clusters will further encourage enterprises with massive data scale to take the self-built mode. The role of the government is to guide the direction of investment and provide supporting facilities, short-term direct government involvement in the construction of data centers is expected to be less. From the existing cases, the three major carriers, Internet companies and local state-owned enterprises have been scrambling to build data centers in the west.
Digital industrialization innovation: the "neck" of the key breakthrough
Core technology is the cornerstone of the digital economy, and China's key digital technology has long been restricted
Core digital technology can be divided into three major tiers, and standing in the current node, the basic digital hardware and software breakthroughs or to realize the The key to breakthroughs in digital technology. Digital economy-related fields are complex, we believe that the core technology can be divided into three major levels, also represents the three major steps to promote the development of the digital economy, i.e., to make up for the key basic technology, expanding the core industrial technology, layout of the next generation of cutting-edge technology. Core technology breakthroughs are the key to promoting digital industrialization and industrial digitization, while breakthroughs in R&D and iterative application of basic hardware and software are the foundation of all digital technology development.
Currently, China's basic hardware and software for the digital economy, especially high-end chips, integrated circuits, industrial software and other fields, have long been restricted by others. According to IC insights data, the world's top 15 semiconductor manufacturers, the U.S. has eight, mainland China is not on the list.
Basic hardware, China's key core technologies are still unable to realize independent control, forming a serious constraint on the development of digital economy.
From components, machine equipment, software, testing and assembly of various links, China is currently in the middle and lower end of the global value chain, the key core technology can not be realized independently controllable, objectively on the integration of the digital economy and the real economy to form a huge constraint.
Currently, U.S. semiconductor companies in the microprocessor and other leading equipment to maintain an absolute advantage, and in research and development, design and process technology to maintain a leading position. Currently, U.S. companies have the largest market share in the global semiconductor sector, at 46.3%, with other countries holding between 7% and 21% of the global market. 2021, none of the world's top 10 semiconductor suppliers will be from mainland China. In the 2019 ranking, China's HISI Semiconductor was ranked 9th in the world with a revenue of $11.55 billion, with a market share of 2.8%. But due to U.S. trade sanctions, HIS has now dropped out of the world's top 25 semiconductor suppliers. According to IC insights, China's semiconductor self-sufficiency rate may be around 15.9 percent in 2020, with less than 5 percent for automotive chips, and only 6 percent if you exclude non-mainland companies that have set up factories in mainland China, such as TSMC, Samsung and SK Hynix.
Basic software, China currently lacks a competitive advantage in operating systems, industrial software and other applications. Operating systems, industrial software and other basic software for the digital economy is difficult to research and development, high technical threshold, high reliability requirements, which leads to its long R & D cycle, high R & D costs, slow iteration. The high R&D investment and long R&D cycle have formed a high industry barrier, and users have also formed a strong dependence on the head software, so the basic information technology software has formed an industry pattern of the strong getting stronger and the winner takes all. Taking the operating system as an example, in 2019, 88% of the domestic PC operating system market share is occupied by Windows, 9% is occupied by macOS, and the remaining vendors' share is less than 4%.
China's high-end industrial software is basically monopolized by foreign software, and the competitiveness of China's industrial software is seriously inadequate. Take industrial software as an example, during the "14th Five-Year Plan" period, the Ministry of Industry and Information Technology (MIIT) organized the implementation of the industrial foundation reengineering project, which merged industrial foundation software, an important part of industrial software, with the traditional "four foundations" into the new "four foundations", which is the new "four foundations". "The Ministry of Industry and Information Technology organized and implemented the industrial foundation reengineering project during the "14th Five-Year Plan" period. Industrial software is a core component of modern industry, and most of China's industrial software relies on overseas products. Specifically:
R & D design: R & D design industrial software localization rate of only 5%, domestically available R & D design products can only be applied to simple industrial mechanism, a single function of the system, the industry's low complexity in the field, such as the domestic CAD applications and molds, furniture and household appliances, general machinery, electronic and electrical industries. The high-end field, China's EDA market has long been monopolized by Cadence, Synopsys, Siemens EDA three giants, the overall market concentration is high, the top three companies accounted for more than 70%.
Manufacturing: manufacturing industrial software occupies half of the domestic market, but in the high-end
Manufacturing: manufacturing industrial software occupies half of the domestic market, but in the high-end