China is undeniably tempting; given both their market size and their willingness to subsidize rather generously when it suits them; but the strength of their desire for indigenous CPU/high-end semiconductor capabilities strongly suggests that anyone who cooperates with them is either a sucker or planning on cashing out in the relatively short term.
Their aggressively priced ARM licencees (most notably AllWinner) have been the ones racking up the design wins; but the MIPS-based ‘Longsoon’ stuff and the somewhat-sparse-on-the-details SW26010 appear to be the darlings of state-sponsored efforts to develop more or less entirely indigenous hardware.
None of that is much use without a decent process to fab it on, though, even the most elegant CPU design at 65nm is going to have a hard time comparing favorably to even mediocre designs that have the advantage of contemporary processes. Since decent fabrication processes are the component China is currently weakest on; they will likely make a quite generous offer to anyone who is willing to set up shop; but given their desire for locally controlled high tech production; their new fab buddy will very likely be shown the door after they have finished using them for technology transfer.
