Chapter 51

Building a motherboard factory was already part of Li Xuan's plan, but Hong Kong's industry was mainly focused on light industries such as textiles, clothing, and toys. The electronics industry was not well-developed, especially in high-end electronics. Even if Li Xuan wanted to poach talent, there was no place to start.

Therefore, if he could cooperate with Epson, Oriental Electronics could quickly establish a foothold in the arcade industry. Once they had their own motherboard factory, the weakest link of Oriental Electronics would be strengthened. The remaining challenge would be to compete with Sega and Atari in game creativity, but Li Xuan, with his rebirth advantage, was not at all worried.

As for whether Epson would be willing to cooperate with Oriental Electronics, Li Xuan was not at all concerned. If Oriental Electronics produced 200,000 arcade machines annually, they would need at least 5 million processors and memory chips. If Epson's wafer factory could secure such a large and stable order, it would be enough to help them through the initial difficult period of low yield.

For Seiko Epson Corporation, the survival of the wafer factory was not just about recovering the tens of millions of dollars invested; it also related to Epson's overall development strategy and choices for the future. The wafer industry is one with a clear scale effect, and low production rates often lead to lower yields, which in turn significantly increase costs.

If the wafer factory continued to incur losses, Epson would eventually have to close it, which would mean a complete failure of their ambitions in the semiconductor industry.

Therefore, after Li Xuan proposed the condition of continuing to purchase Epson chips, he was not at all worried that Epson would refuse. Oriental Electronics and Epson did not have a direct competitive relationship. Although helping Oriental Electronics establish its own motherboard production factory would mean Epson losing some of the profits from arcade boards, once Oriental Electronics fulfilled the contract for 20,000 game machine motherboards, they would have no obligation to continue purchasing motherboards from Epson. If they could secure the core chip orders by giving up some uncertain profits, Epson would certainly make a win-win choice after careful consideration.

Of course, Nobuyuki Hattori, as a board member, did not have the authority to immediately respond to such a significant cooperation proposal. He needed to report it to the company's board of directors, and only after the board's discussion could a decision be made. Li Xuan was well aware of this and did not try to retain Hattori any longer.

The new semester had just started, but Li Xuan was not at ease. Compared to his college entrance exam scores, his performance in the first semester had clearly declined. After all, academic performance is directly proportional to the time invested.

Li Xuan's goal in entering university was not to become an outstanding graduate. He wanted to use the university platform to begin interacting with and integrating into Hong Kong's high-end academic circles, accumulating technical connections for the future development of his company.

He was somewhat indifferent to his classes, but some people who were paying attention to him began to worry secretly. In the last two months of the first semester, Li Xuan, busy with the development of new games for Oriental Electronics, skipped many required courses and rarely attended the elective courses he used to frequent.

Professor Zhao Weiming had been paying attention to this special new student in the electronic computing research program since Li Xuan attended his weekend salon. Although Li Xuan attended fewer of Zhao's lectures, he still made time to attend the salon regularly.

In Zhao Weiming's view, Li Xuan was a talented student who had become somewhat lost in the colorful life of the university. After noticing that Li Xuan's truancy had not improved much since the start of the new semester, Zhao Weiming, as the deputy director of the Department of Electronics, decided to have a talk with him, hoping to guide this student back on the right path.

"Professor Zhao, you wanted to see me?" Li Xuan knocked on the door of Zhao Weiming's office and entered after hearing a response.

"Li Xuan, please sit down. I'll finish grading these documents first!" Zhao Weiming looked up and smiled warmly at Li Xuan.

Li Xuan sat quietly, his eyes fixed on his nose, his mind at peace. Zhao Weiming secretly observed Li Xuan a few times and nodded in approval at his calm and composed demeanor.

Finally, Zhao Weiming put down his pen, adjusted his slightly sliding glasses, and said to Li Xuan, "I heard you were absent on the first day of the semester. What happened?"

"Sorry, Professor Zhao, for troubling you!" Li Xuan stood up, looking sincere, "I started a company recently and have been busy with it. I will try to separate my company work from my studies in the future to avoid affecting my studies!"

Zhao Weiming's originally relaxed expression turned serious. He did not like students starting businesses during their studies. In his view, university was a time to focus on building a solid foundation, and rushing to make money without a solid foundation was not a wise choice.

"What does your company do?" Although Zhao Weiming was somewhat displeased, he did not want to make a hasty judgment.

"We are in the business of large electronic game machines. Recently, the company went to San Francisco for the Western Electronic Show, and I led the team, so I missed the first few days of classes!" Li Xuan did not hide much and explained straightforwardly.

"I am not saying that I am against you starting a business during your university years, but there is a condition: it should not affect your studies. I had high hopes for your talent, both in your solid professional foundation and your keen foresight, which impressed me greatly. However, your recent performance has disappointed me. You are not making good use of your talent, and skipping classes is a very bad habit!" After gathering enough information, Zhao Weiming began to educate his student.

Li Xuan sighed inwardly. His life goal was not to be a research worker. The idea of studying hard and making progress every day was like a cloud to him.

"Professor Zhao, I will pay more attention in the future!" Li Xuan did not argue and admitted his mistake readily, "I know you are leading a team in processor design research. If my company, Oriental Electronics, wants to commission you to improve the 6502 processor from MOS Technology, how should we proceed?"

Zhao Weiming found Li Xuan's attitude of admitting his mistake acceptable, but he was taken aback by the sudden change of topic. After a few seconds, he looked at his student with a puzzled expression.

The 6502 processor is most famous for its use in Apple computers and the Nintendo Entertainment System (NES). However, Nintendo did not directly purchase the original 6502 chip from MOS Technology but used a 6502 chip licensed and produced by Ricoh, the 2A03 NMOS processor.

This was a processor that Ricoh redesigned based on the original 6502 core, integrating a pseudo-sound processing module to save on additional sound chips when used as a game console CPU. When Li Xuan initially designed the game boards for "Hong Kong Blocks" and "Tank Battle," he planned to use this chip, but Ricoh informed him that they did not produce this chip.

Li Xuan only remembered that the NES was released in 1983, but he was not sure when Ricoh obtained the license to produce the 6502 chip from MOS Technology.

Therefore, after learning that Epson had obtained the license for the 6502 chip, he decided to use Epson's chip and flew to Japan to persuade Epson to produce the arcade machine motherboards for him.

Li Xuan had already sent someone to the United States to negotiate the 6502 chip license with MOS Technology. However, after obtaining the license, he did not plan to develop a new chip himself. Developing a new processor is much more complex than designing a game motherboard.

Even with the original 6502 processor structure as a reference, redesigning a 6502 suitable for game consoles is not an easy task. Although Li Xuan had a rebirth advantage, he was not omnipotent. This work was better suited to a specialized processor development team, and Professor Zhao Weiming's team at the Chinese University of Hong Kong was undoubtedly his best choice.

"Professor Zhao, Oriental Electronics is willing to sponsor 10 million Hong Kong dollars to support the Chinese University of Hong Kong's research in processor design. We hope to closely cooperate with the university in the commercialization of related research results!" Li Xuan said his plan seriously and solemnly.

The conditions for Oriental Electronics to establish a large-scale research team were not yet ripe, and cooperating with the university was undoubtedly the best choice. Li Xuan's ambitions did not stop at the arcade industry. In fact, the glory of the arcade industry was very short-lived.

In the late 1980s, the largest consumer market for arcades, North America, saw intense competition from computer games and video games. The primary locations for arcade machines—small shops and convenience stores—disappeared with the rise of large chain stores like Walmart. These factors combined led to the rapid decline of the arcade industry.

In stark contrast, the semiconductor industry, driven by the personal PC wave, began to grow explosively. Li Xuan naturally did not want to miss out on the semiconductor industry, which is the foundation of the electronics industry.

However, his current business was just starting, and he needed to expand horizontally to quickly establish a solid foundation in the game industry before expanding vertically into upstream and downstream industries. But he could lay some groundwork in advance.

In the face of a large amount of research funding, Zhao Weiming completely forgot the real reason for calling Li Xuan in. When Li Xuan introduced the basic situation of Oriental Electronics and confirmed that he indeed had the ability and intention to invest a large sum of money in his alma mater, even the usually composed Zhao Weiming became restless.

This was 10 million Hong Kong dollars, equivalent to about 2 million US dollars. While this amount might be negligible to world-class universities like Berkeley and Stanford, for the Chinese University of Hong Kong in 1980, it was a substantial sum. The university's annual tuition income was only a few tens of millions of Hong Kong dollars.

In the face of such a large amount of real money, Li Xuan's previous truancy became a trivial matter.

PS: The update is too late, please bear with me!

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