a domestic security chip’s road to breakout. exclusive interview with shanshi.com’s ke luo dongping: we have technical beliefs engraved in our bones
2024-09-30
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a domestic security chip’s road to breakout. exclusive interview with shanshi.com’s ke luo dongping: we have technical beliefs engraved in our bones
reprinted from: times weekly
one day in 2021, luo dongping convened several core management personnel at the shanshi network technology building in suzhou to discuss a major decision-whether to make a completely independently developed asic security chip?
this is a road that no one has taken in the domestic professional network security field, and it requires a lot of investment. "it is a bit challenging, but also very groundbreaking. this is something that the domestic information security industry must do." as the chairman of shanshi network technology (688030.sh), he has been deeply involved in the field of network security for many years. luo dongping, a 30-year "veteran", said in an exclusive interview with a reporter from times weekly, "solving this single point problem will solve the major strategic issues behind it."
"innovation" (information technology application innovation industry) is one of the hottest topics in the market in recent years. in 2019, information innovation policies ushered in a "big explosion". in the following three years, information innovation-related policies showed a step-by-step growth. especially in 2021, there have been 45 information innovation-related policy documents issued across the country.
the ecosystem of the information and innovation industry is huge, covering almost all aspects of the information industry. from the perspective of the industrial chain, the information innovation industry mainly includes four major fields: basic hardware, basic software, application software, and information security. among them, chips, complete machines, operating systems, databases, and middleware are the most important links in the industry chain.
in 2021, shanshi network technology officially launched the security chip strategy. in 2023, it will conduct technology research and development of self-developed asic security chips. it aims to comprehensively cover important links in the cybersecurity and innovation industry chain through independent innovation technology and provide users with more efficient and safer solutions. network security. chips are the “jewel” in the crown of underlying hardware technology for network security, and are also one of the dilemmas that my country’s xinchuang localization needs to overcome urgently.
but for luo dongping and his team, making asic security chips is "too familiar."
the wind rises at the end of qingping. as early as 1997, luo dongping, who came to the united states to study after graduating from tsinghua university, joined netscreen, a network security company founded by three tsinghua seniors. as a member of the core founding engineer team, luo dongping is responsible for chip development.
"at that time, netscreen gathered a group of people who were particularly skilled and courageous. as soon as the special equipment products equipped with self-developed chips were launched, the performance of all security equipment on the market was improved by leaps and bounds." luo dongping recalled road. in 2001, netscreen was listed on nasdaq in the united states. in 2004, netscreen was acquired by juniper networks for us$4.2 billion, making it the most valuable technology company started by chinese students in the united states at that time.
long before the trend of information innovation swept china, in 2007, luo dongping and several technical experts who had participated in netscreen's entrepreneurship returned to china and founded shanshi network technology, starting a new entrepreneurial path. in september 2019, shanshi network technology was listed on the a-share market as one of the first batch of companies listed on the science and technology innovation board.
at present, shanshi network technology has formed a network with four major technical characteristics of "holography, quantification, intelligence, and collaboration" involving border security, cloud security, data security, business security, intranet security, intelligent security operation, security service, and security operation and maintenance. eight major categories of product services, including complete solutions for more than 50 industries and scenarios, have so far provided services to finance, government, operators, internet, education, medical and health and other industries, covering more than 60 countries and regions, with a total of more than 28,000 users. provide products and services to efficiently and stably support the sustainable and safe operation of customer businesses.
in 2023, shanshi network technology's revenue will reach 901 million yuan, and its r&d investment will be 375 million yuan, a year-on-year increase of 10.42%, accounting for 41.58% of the company's operating income, accounting for more than 36% for three consecutive years. in terms of patents, shanshi network technology has mastered 30 independent research and development core technologies and applied for more than 500 domestic and foreign patents. according to idc's "china it security hardware market tracking report for the fourth quarter of 2023", in 2023, shanshi network technology ranked second in the internet industry and has been among the top three for three consecutive years, and ranked third in the financial industry for two consecutive years. ranked in the top three. according to the "idc marketscape: china data security management platform 2023 vendor assessment" report released by idc, shanshi network technology was selected as a typical representative and is located in the "major players" quadrant.
on the important juncture of the fifth anniversary of the opening of the science and technology innovation board and the fifth anniversary of the listing of shanshi network technology, times weekly reporters had an in-depth discussion with luo dongping on topics such as chip strategy, artificial intelligence technology application, information and innovation industry layout, and development trends of the science and technology innovation board. dialogue.
as a long-term entrepreneur, luo dongping and his team have a belief in technology engraved in their bones. "the logic behind the self-developed security chip is very similar to that of the aviation industry - once the aero-engine problem is solved, all aircraft platforms will be comprehensively improved. the self-developed security chip is to equip all security platforms with an engine with excellent performance ', the performance of the domestic security platform will be greatly improved," luo dongping said excitedly.
breakthrough xinchuang: products equipped with self-developed security chips will be available in 2025
times weekly: "chip strategy" is one of the "four tough battles" of shanshi network technology. the self-developed asic security chip can be described as an important step in shanshi network technology's technological innovation. why did shanshi network decide to develop its own asic security chip? what were the market and technical considerations behind this decision?
luo dongping: currently, it will take some time for domestic cpu performance to improve. as far as the xinchuang security field is concerned, this dilemma has resulted in network security equipment being unable to meet the ever-increasing network speed, or having to meet this demand at an extremely high cost. at the same time, if the performance of network security equipment cannot meet customer needs, it will also weaken the competitiveness of going overseas. therefore, we need a domestic self-developed asic security chip to match the domestic cpu, so that the performance of domestic security equipment can be greatly improved, thereby solving the current xinchuang security dilemma.
shanshi network technology's decision to make chips almost perfectly reproduces the situation when we started netscreen. it is equivalent to redoing what we have done in the past at a higher level.
why is it not easy for others to develop self-developed security chips? because we initially chose a distributed architecture technology route based on multi-core cpus, and we are a very unique software and hardware integrated design manufacturer among domestic professional security manufacturers. therefore, self-developed asic security chips are a very natural product extension on the road to self-developed security hardware platforms.
looking back, shanshi network technology initially chose the most difficult path, but without this technical route, there would be no self-developed security chips today. now, everything we do can be strung together.
times weekly: what is the strategic intention behind the localization of self-developed asic security chips? what impact will it have on shanshi network’s competitiveness and market position? what efforts have been made to achieve this and what are the biggest challenges encountered?
luo dongping: technology has no national boundaries. self-developed asic security chips will comprehensively enhance the market competitiveness of shanshi network’s security products. we not only want domestic customers to use shanshi network's excellent xinchuang security products, but also allow shanshi network's xinchuang security products to create a new world overseas.
back then, when we made security chips at netscreen, we were solving a purely technical problem, but today the meaning of making self-developed chips in china is very different. in addition to solving the performance problems of xinchuang security products mentioned earlier, it can also solve the problem of too many product lines, which will greatly increase r&d and operating costs.
asic is a chip specially designed for specific applications, with advantages such as high performance, low latency, and low power consumption. after the launch of shanshi network technology's self-developed asic security chip, it will be able to cover domestic and overseas markets with its "quanxinchuang" product line. this also means that we only need to maintain one set of product lines, which is greatly simplified and solves problems in domestic and overseas markets at the same time. we are fully capable of competing with foreign brands and will greatly improve product profitability.
overseas markets also involve the company's longer-term development strategy. in the current economic environment and international situation, developing overseas business is inevitable. shanshi network technology has a mature team and many years of development experience in overseas markets. in the future, our goal is to account for one-third of our revenue from overseas markets.
at present, the company has completed the research and development of 30 models of hardware platforms in preparation for subsequent installation of asic security chips. the final product will be gradually released as planned in 2025.
technological belief: adhere to long-termism, deeply embrace ai and open cooperation
time weekly: since you returned to china from silicon valley in 2007 to start your own business, you can say that you have witnessed a wave of development of china’s internet. looking back on the growth process of shanshi network technology, what are the key nodes? can you share what key decisions were made during this process?
luo dongping: all the key decisions made by shanshi network technology have a common background, which is long-termism. whether we choose the distributed architecture technology route based on multi-core cpus, develop self-developed security chips, or fully join forces with digital china (000034.sz) to build an ecosystem, or standardize and improve company management capabilities through the listing process, we are all working for prepare for long-term healthy development.
technological innovation is also inseparable from long-termism. for example, our founding team chose the distributed architecture technology route based on multi-core cpus from the beginning. the initial investment in this technical route is relatively large, and it is also quite difficult. if you are just making a short-term product, there is no need to choose this technical route. but if this technical route is completed, the development potential will be very huge. we made this choice from a long-term perspective, and the subsequent development process confirmed that this was a very correct choice.
times weekly: shanshi network technology has a strong technical gene and has many firsts in the industry. how was such a technological gene formed? how has it shaped its current market position and technological advantage?
luo dongping: shanshi people define themselves as “believers in technology.” our core team has all participated in the successful entrepreneurship of netscreen, forming a belief in technology and establishing a technology-based development philosophy. the leadership of technical capabilities was also fully considered when building the team. after years of persistent investment in technological innovation, shanshi has established a clear market position and advantages.
take the product category of network firewalls as an example. since 2014, shanshi network technology has been ranked first among chinese security vendors in gartner's magic quadrant for network firewalls. zhou hongyi, founder and chairman of 360 group, has also publicly stated that shanshi network technology is the only high-end firewall company in china that can match silicon valley's firewall technology.
times weekly: facing the increasingly complex network security environment, how does shanshi network technology provide customers with more comprehensive and intelligent security solutions? how to seize the technology iteration opportunity of ai and integrate it into products and services to improve security defense capabilities?
luo dongping: network security is very difficult. cyber attacks are constantly changing and asymmetric - offense always has an advantage over defense. the attacker holds a spear and attacks our shield. as long as there is a slight hole in the shield, the spear can penetrate. therefore, constantly adopting new technologies to innovate products and solutions based on changes in offensive and defensive situations is the basis for shanshi to continuously improve its defensive capabilities for customers.
ai technology did not just appear in the past two years. in the past two years, the outstanding performance of generative ai and large language models has caused a sensation. large language models have achieved remarkable results in the field of network security, but traditional ai technologies (such as machine learning, deep learning, etc.) still have irreplaceable advantages in most scenarios.
shanshi network technology began to promote the application of ai in the field of network security 10 years ago and continues to launch ai-based security products and solutions. we have applied traditional ai capabilities to security products such as firewalls, idps, ndr, and continuous safe operation capabilities.
in the past two years, due to the outstanding performance of generative ai and large models, shanshi has continued to implement its security large model capabilities in more products and security scenarios. for example, intelligent operation and maintenance assistant, threat event correlation analysis, data security classification and classification, etc.
all in all, network security must deeply embrace ai.
times weekly: can you talk about how shanshi networks builds a network security ecosystem based on its technological genes?
luo dongping: since this year, shanshi network technology has vigorously promoted the new concept of "comprehensive opening from south to north, shanshi ai leads the future". this is an important measure for shanshi network technology to implement ecological win-win.
the original intention of "opening from south to north" is to solve the current pain points of user operation and maintenance. because users often purchase various security products from different manufacturers and categories, there are problems such as poor cross-platform compatibility in operation and maintenance management. "southbound opening" is based on the shanshi xdr system, which is compatible with security components of friendly vendors from multiple dimensions and simplifies unified management of users. "northbound opening" will open shanshi's security components to the outside world, and integrate shanshi's various security capabilities into its management platform through third parties or capable customers.
under the general trend of ai, opening up from south to north has special significance. the outstanding ability of large models must be exerted at key points in the data set. due to the large model's strong ability to understand language, it is possible to develop a comprehensive understanding of information from different industries and dimensions, so that information from different industries and dimensions can work together at a key location, resulting in more powerful security capabilities.
"south-to-north opening" can also achieve the deep integration of "security + business", deeply integrating security into the business and making security the basic ecology of all businesses. the creation of this ecosystem is not a temporary need, but a long-term plan.
capital boosts new productivity: innovative allocation of production factors to achieve ecological win-win
times weekly: how do you understand new productivity? how to summarize the new productivity of shanshi network technology?
luo dongping: i believe that new productivity is the combination of technological innovation and ecological win-win, which ultimately achieves the healthy development of enterprises.
from the perspective of technological innovation, shanshi network technology has spent a lot of energy on making security chips in recent years. in the new xinchuang environment, our chip has just been designed, which is a revolutionary technological breakthrough for the market and the entire industry. in terms of artificial intelligence, our application started ten years ago. now it is combined with large models with more powerful capabilities, and the product power has been greatly improved. to a certain extent, this is also an innovative configuration of production factors.
technological innovation will also promote ecological win-win. the meaning behind the combination of technological innovation and "comprehensive opening up from south to north" is: on the one hand, after our chips are made, the security platform can be easily adapted to any domestic cpu, and the product ecological environment will be improved. , ecological win-win has become more realistic; on the other hand, combining our technological advantages with digital china's ecological advantages to form an innovative combination configuration will bring a more imaginative ecological win-win development space.
times weekly: how do you evaluate the financing capabilities of the science and technology innovation board? emphasis on r&d is a common feature of companies listed on the science and technology innovation board. how will the capital market be used to support technological innovation and business expansion in the future?
luo dongping: the science and technology innovation board is a particularly important platform for companies like ours that innovate in science and technology and develop new productivity. it provides financing channels for technology companies at different stages of development. in the past five years, the total financing of the science and technology innovation board has exceeded 1 trillion, and the r&d investment of the science and technology innovation board companies is about three times that of the entire a-share market. from this point of view, the science and technology innovation board has transformed and industrialized the results of new technologies. speeding up is very helpful.
from the perspective of shanshi network technology, technological innovation and leadership have been regarded as a fundamental idea for development since the company was established. when we went public in 2019, we raised approximately 859 million yuan from our ipo. two of the three projects we raised were related to research and development. after we went public, we used convertible bonds to raise funds, also to support research and development projects.
next, we will pay more attention to the r&d projects that are most critical to business innovation and development, such as self-developed chips and artificial intelligence, which can support us in adapting to the information innovation situation and building innovative competitiveness. we hope that the capital market can continue to support hard-core technology companies like ours, allowing us to work in more critical places to achieve healthy development and high-quality growth, thereby giving back to the capital market.
times weekly: not long ago, the china securities regulatory commission announced that it would launch the "eight rules for the science and technology innovation board" to further highlight the characteristics of "hard technology" and improve the efficiency of refinancing review of science and technology innovation companies. as a company listed on the science and technology innovation board, how do you view these changes? how to predict the future development trend of the science and technology innovation board?
luo dongping: hard technology needs time to accumulate, so it needs more capital support. it is crucial for science and technology enterprises to refinance more efficiently to accelerate the research and development of key core technologies and promote the high-quality development of enterprises.
by simplifying the review process and improving review efficiency, scientific and technological innovation companies can obtain financial support faster and accelerate the pace of innovation. this is what innovative technology companies are willing to see.
we hope that the science and technology innovation board will attract more companies with core technologies and high growth potential to go public.
times weekly: in the face of market fluctuations, how should the policy and corporate levels retain "patient capital"?
luo dongping: shanshi network technology is very lucky. investors in history are almost all "patient capitals". the most patient capital, "northern light venture capital", has been with us for 18 years and has played an important role in the development of shanshi network technology, a believer in technology. played a vital role.
we hope to intensify efforts to promote the scale of "patient capital", and at the same time provide policy-level support for "patient capital" that supports technological innovation, so that they can truly settle down to help technological innovation companies, jointly go through the cycle, and promote a healthier capital market. develop.
