Industry Dialogue Overdue
on Third-Party IP Issues
By Walter Ng
Vice President, Design Enablement Alliances
Chartered Semiconductor Manufacturing
The historic problems, which
have plagued third-party IP suppliers, have not gone away, nor have
they been addressed to any great degree. Primary among these challenges
are establishing value for different types of IP and a standard business
model to go along with that, creating industry standards around IP quality,
and developing a support and maintenance model more closely tuned to
customer needs. The situation is not improving, and as a
matter of fact, at 32nm, things may be getting even more difficult for
third-party IP suppliers.
As companies across the supply
chain increase their investments significantly to "stay in the game"
at the leading edge, IP suppliers are struggling to keep up.
That should come as no surprise, when you look at a fragile industry
made up of many very small players and a few mid-size - relatively
speaking - companies that hold most of the market share. Investment
in leading-edge IP development continues to be one of the industry's
biggest challenges. With fewer and fewer companies actually manufacturing
silicon today, it may soon become quite daunting to find a manufacturing
partner. Some manufacturers are becoming focused solely
on internal IP development, while others, who remain committed to being
open in working with third parties, may be able to support only a limited
number of partners from a focus and bandwidth perspective, as the degree
of collaboration required increases significantly.
An industry and its supply
chain are only as strong as the weakest link in that supply chain.
Each part of the supply chain that forms the semiconductor industry
has been under extreme pressure over the last number of years to change:
to evolve and become more technically and economically efficient.
Semiconductor companies themselves have gone through tremendous change
- mostly in the transformation to fab-lite entities. Foundries
have been driven to either double-down on a mainstream leading-edge
strategy or to drop out of the race and focus on a specific niche area.
Significant consolidation in the package and test areas has occurred.
EDA companies continue their traditional cycles of reinventing their
business models and pulling the customers through. It is the third-party
IP suppliers that are falling behind, as the industry has not made the
changes necessary to adjust, despite the pressure from customers and
efforts from industry organizations like GSA.
Collaborative models such as
the Common Platform - a manufacturing and technology alliance between
IBM, Chartered and Samsung - are helping reduce the IP suppliers'
risk, bringing resources and a philosophy of openness to the equation.
We have realized we can achieve more together, even as 'co-competitors,'
and the inherent value that many specialized IP suppliers bring to our
mutual customers is worth the effort. But such efforts can only mitigate,
not remove entirely, the risk for IP suppliers. Increasingly, at the
leading edge, ours is not an industry for the faint of heart.
At the leading edge of technology,
fabless and fab-lite companies, for the most part, are used to being
self-sufficient. They require very little if anything from
external third-parties, including IP. They have been conditioned
not to expect the availability of third-party IP at the time they migrate
to the next node. From an overall industry standpoint, we
- and by that I mean the collective "we": customers, foundries,
ecosystem partners - would like to accelerate and enlarge the number
of companies which adopt leading-edge technologies, but the bottlenecks
in the supply chain are formidable barriers for some. The
availability of third-party IP is, for some, a bottleneck at the leading
edge. As we see more companies move and adopt leading-edge
technologies, more are choosing to move towards a self-sufficient model,
developing IP internally instead of leveraging third-party IP.
This may be an indication that customers have concerns about the long-term
viability of the third-party IP industry.
As customer concerns in the
third-party IP arena have grown, others in the supply chain have felt
a need to try and address the gap. We have observed more
design service companies designing and providing IP to customers.
Is this where the third-party IP industry is going as it evolves toward
a services model? There has also been a noticeable increase
from some manufacturers of proprietary foundry IP, which is made available
or licensed to end customers. If the third-party IP industry
is not going to evolve and find a way to resolve its challenges, others
will find a solution - because they must find way a way to service
the end customer. Given this, it is open to interpretation
whether design services companies and foundries are collaborators with
third-party IP suppliers or, dare we even say, competitors. What
is clear, though, is there continues to be significant challenges in
realizing a healthy, robust third-party IP industry. Until such an ecosystem
exists, it strains the overall semiconductor supply chain.
With the number of moving parts
and changing roles, there needs to be active dialogue among all the
players in order to chart a path forward. GSA - which has done laudable
work on IP issues through its various subcommittees - brings us the
upcoming IP Conference, being held September 24-25 at the Santa Clara
Convention Center in Santa Clara, CA. This conference presents a forum
for debate and open exchange of ideas on the issues faced by the IP
industry today. Program topics include the importance of utilizing quality
IP; who owns the problem of quality, verification, and reliability related
to yield; digital versus analog IP validation, and measuring IP effectiveness.
The event wraps up with a panel bringing together multiple perspectives
on the "Integration of Foundry and IP Suppliers," moderated by Dave
Bursky, semiconductor editor at Chip Design Magazine.
Everyone who has a stake in
the IP business model - customers, foundries, partners - needs to
join the discussion. These challenges are not going away. As 32nm approaches,
the issues become even more pronounced. Together, we must address
these issues to enable the continued growth of the semiconductor industry.
Walter Ng reports to the Senior Vice President of Technology Development and is responsible for identifying, developing and executing customer and partner alliances that advance the adoption of Chartered's solutions for the leading-edge and mainstream technology nodes. Walter has led the company's collaboration with IBM to define the strategy and implementation of the solutions and third-party network for the industry's first common design enablement platform at 90 nanometer (nm) and 65nm while currently driving 45nm and setting strategy for 32nm. Previously, Walter served as senior director of design solutions and was responsible for driving and managing Chartered's relationships with third-party EDA and IP partners. Walter has been in the electronic design and EDA industry for nearly 20 years. Prior to joining Chartered, Walter was Director of Business Development and Asia Pacific Operations with Sequence Design. In this position, he was responsible for establishing, managing and growing Sequence Design's Asia Pacific sales channel and marketing activities in addition to managing the strategic relations program for foundries, EDA and IP partners. From 1994 to 1999, Walter worked with Cadence Design Systems, where he held positions in strategic marketing and numerous roles in applications engineering, consulting services, sales support and marketing. Previously, he has held various senior design and test engineering positions in Raytheon's Equipment Development Labs. Walter holds a B.S. in Electrical Engineering from the University of Massachusetts, Amherst, and an M.B.A from the University of Massachusetts, Boston.
