After the layoffs, Bitmain is accelerating its pace to return to the "main channel"

With the economic downturn, there have been news of layoffs in major companies recently. Didi announced that it would lay off 2,000 employees, JD.com eliminated the bottom 10% of its senior management, and Bitmain was also rumored to have just completed its latest round of layoffs.

According to sources, Bitmain's layoffs were completed at the end of 2018 and the beginning of 2019, and there have been no recent staff adjustments. Due to the decline of cryptocurrencies such as Bitcoin, major blockchain companies are in a state of contraction, and Bitmain is no exception.

Interestingly, the media found that Bitmain did not stop after the layoff storm.

On January 29, Bitmain signed a contract with the Fuzhou Municipal Government to undertake the Fuzhou "City Brain" project. The mayor of Fuzhou expressed his full support and hoped to carry out all-round cooperation.

On February 18, Bitmain released the second-generation 7nm mining chip BM1397. The 7nm chip completed its second iteration in just half a year.

In my opinion, layoffs are not a bad thing for companies. When the Internet bubble burst in 2000, Jack Ma cried and announced Alibaba's layoffs, laying off a large number of employees. Later, Alibaba survived the most difficult times and became one of the world's leading Internet giants.

Therefore, the purpose of layoffs and the performance after layoffs are more important.

According to sources, the core purpose of Bitmain's layoffs is to focus on the fields of mining machines and AI chips, and cut projects unrelated to the main business, such as some new projects in the pan-AI field and pan-digital currency, so that the company can stay firmly on the main channel.

“After the layoffs, some personnel returned to the main channel, and the core project personnel became more sufficient,” a person close to Bitmain revealed.

Focus is not something that only Bitmain is doing, but it is the norm in the cold winter. Before Lu Qi came to Baidu, Baidu was independent and had thousands of projects. After Lu Qi joined, he comprehensively diagnosed Baidu's moat and established the two main channels of feed flow and artificial intelligence. Although Lu Qi has left now, Baidu's strategic direction has become clear.

After Bitmain implemented its focus strategy, it can also be seen that the pace of its core business has begun to accelerate.

Take Fuzhou City Brain as an example. For artificial intelligence companies, City Brain is a big order among big orders. Previously, Alibaba Cloud won the bid for Haikou City Brain project with a budget of 483 million yuan. As a developed city with a GDP far higher than Haikou, the capital of Fujian Province, and the host of Digital China, the amount of money for City Brain will definitely not be low.

Authoritative media a&s commented that Bitmain's signing of the city brain contract shows that AI chips, as the "engine" of urban development, have enabled AI chip companies to move from behind the scenes to the front stage and enter the first echelon of smart cities, which traditionally only included BAT, Huawei, and Hikvision.

Bitmain's advantage lies in its mature self-developed AI chips, acceleration cards, servers and a large number of application-level ecological partners. This is also the reason why it can quickly expand into the smart city field compared to other chip manufacturers.

If the City Brain represents the expansion results at the business level, then the launch of the second-generation 7nm chip represents the embodiment of Bitmain's core R&D strength after layoffs and focusing on the main channel. Behind this is Bitmain's beginning to form a moat as a mature chip company.

7nm is the crown of current chip technology. Various chip design companies hope to achieve higher performance, lower power consumption and smaller chip area through process upgrades, but 7nm poses extremely high challenges to the design field.

Experts pointed out that in order to meet the production rules of process manufacturers, 7nm added a lot of hard rules in the design stage, which greatly increased the difficulty of chip design, especially back-end design. For example, when using the metal layer, the bottom metal can only be used according to a specific pattern and direction, and the flexibility is greatly reduced. Therefore, MediaTek has given up the research and development of 7nm mobile phone chips, and Xiaomi's self-developed chips have also given up on moving towards high-end mobile phone chips. As a result, Qualcomm, Huawei HiSilicon, and Apple, which have completed the design of 7nm chips, have a moat.

Although the design of the mining chip is relatively simple, Bitmain was able to carry out 7nm-level iterations in a short period of time. Funds, talents, and technology are indispensable. Funds, talents, and technology have also objectively formed the moat emphasized by Lu Qi, and there are fewer competitors who can challenge in the bear market.

In my opinion, the blockchain world has experienced ups and downs, and the surge and plunge of Bitcoin in the past few years is not uncommon. Bitmain, which has returned to the main channel, actually only needs to maintain its technological advantages and wait for the flowers to bloom. Readers may wish to watch it calmly.