Taiwan: Technology Leads the Road to Success
Robbins Yeh, Country Manager of Synopsys Taiwan, suggests how IC companies in Taiwan can develop their strengths to maintain growth.
In the last few years, the semiconductor industry has seen faster growth in Asia-Pacific than in other global regions. India currently leads the move towards sub-90nm process geometries, and Taiwan exhibits deft management, high design standards and great flexibility to market trends, while the rapidly growing industry in Mainland China is preparing to address some potentially huge market opportunities.
Despite the strengths of the region, entry into the advanced semiconductor arena is becoming increasingly difficult for Asia-Pacific IC design companies. A sophisticated 65nm design project requires at least 700 hardware and software engineers and greater resources than at previous geometries.
How can Taiwan IC design companies prepare themselves to face these developments? Yeh recently explored the issues in a keynote entitled “Challenges and Opportunities – Core Value of EDA” at a DigiTimes Advance Flow Forum in Taipei, Taiwan. Below are his observations on the strengths of China, India, and Taiwan, and suggestions to Taiwanese IC design houses.
Economic Growth Affects Demand for ICs
According to Yeh, one of the reasons for the increasing demand for IC-related technology is the rapid growth of the middle class in India, Mainland China, South America, and some of Eastern Europe. The emerging middle class in these areas results in a shift of the global economic focus, especially electronic consumer market. “Global demographic trends like this have also indirectly facilitated the advance of IC-related technologies over the last ten years,” he says.
“As consumer electronics become increasingly compact and light, the focus of technological evolution has shifted from computation to connectivity, to the convergence of the two. Convergence is a global trend that is going to have a deep, powerful and lasting impact.”
As IC-related technology becomes more popular, so does demand for price reduction. However, pricing is not the only critical factor for marketers of consumer technology to consider. Because teenagers and young people are an important audience for IC-related technology, and many of them buy innovative electronics as soon as it becomes available, it is also important to achieve faster time-to-market. In order to keep up with this market, chip design is becoming increasingly complicated, and companies have to focus on newer processes and lower cost solutions.
Asia-Pacific Growth Patterns
The growth of the semiconductor industry in Asia Pacific has been the world’s fastest over the past several years. In 2005 Asia Pacific amounted to 44.5 percent of the global semiconductor market, 11 percent higher than that in 2004, followed by 4 percent for Europe, Middle East, and Africa (EMEA), 1 percent for North America, and 0.2 percent for Japan. In particular, China, India, and Taiwan are the strongholds that catch semiconductor conglomerates’ attention. To claim market leadership across all regions, heavyweights like TI, Intel and Broadcom must first make special efforts to increase their presence in these countries.
The growth of India’s IT and electronics industry is aided by the use of English as a business language and strategic government incentives to attract international investment and recruitment interest from the likes of TI and STMicroelectronics. These companies also bring advanced technology to India, which is the main reason why 37 percent of Indian IC designs have already adopted the advanced 90nm process. In Taiwan, this figure is just 16 percent. “India is able to move to 90nm and even 65nm directly from the 0.18um process mainly because of technology support from major US and European companies,” claims Yeh.
“Mainland China has the world’s largest consumer market for semiconductors and, like India, a good annual supply of science and engineering graduates from college and talented people returning from abroad. As a result, it has also seen great investment from multinationals and significant annual growth of its IC design market.”
The Taiwan semiconductor industry has a solid foundation – not only is Taiwan the global foundry leader, it is also the global IC packaging leader, and it is second only to America in the IC design industry. ”Vertical integration of the Taiwan semiconductor industry is a great advantage for Taiwan IC companies facing global competition, as there is a complete industry chain from downstream to upstream featuring highly professional collaboration as well as effective clustering,” says Yeh. “Furthermore, Taiwan benefits from its role as the operation center of a ‘silicon triangle’ in which funds, talent and technology from Taiwan are strategically connected to those in Mainland China and Silicon Valley, the other two important corners of this triangle.”
Staying Ahead of Design Innovation
While past processes relied on hardware engineers, cutting-edge IC design needs more software engineers. According to the Fabless Semiconductor Association (FSA), for 90nm designs the number of hardware and software engineers required is respectively 2.5x and 3x that required by the previous generation 0.13um process. The typical 65nm design requires 390 software engineers and 311 hardware engineers, which means that an IC design company working on a 65nm project typically requires an engineering team of more than 700 people. Evidently, talent is indispensable to staying ahead in design innovation and migration to advanced, high-end technology.
The Role of EDA Vendors
So, in the light of this trend, what is the role of EDA vendors? “We need to face up to increasing challenges from both design and yield improvement,” says Yeh. “For example, more gates on chips mean that the overall design has become increasingly complicated – from 7.5 million gates for the 0.25um process to 188 million gates for the 65nm process. Other challenges include the timing closure issue of the 0.18um process, the signal integration issue of the 0.13um process, and the leakage issue of the 90nm process. These all require more advanced EDA tools to help designers working on their sophisticated projects.”
“Also, a recent trend requires IC design to take manufacturing into consideration at the onset. Designers today need to cope with the challenge of producing devices successfully as well as maintaining a high yield. IC design should factor in issues of design for manufacture (DFM) and intellectual property reuse, and should also be tightly connected with verification.”
“The solutions that customers really need,” stresses Yeh, “are productivity enhancement and design predictability, in addition to EDA software tools of powerful performance. According to studies by many independent organizations, Synopsys stays ahead of its competitors in both technology and productivity.”
Creating New Business Opportunities
So, how to address the challenges facing the Taiwan IC industry in migrating to a new generation of technology? “Taiwan companies tend to be small with rather limited resources, but they could still have a presence on the international stage by embracing new technology, forming strategic alliances, and cultivating talent to enhance their technology,” says Yeh. “Facing competition from globalization, the business community should adopt an international mindset to enable a broad picture and vision of the market, learn how to develop an organizational culture conducive to enlisting the best people of different backgrounds, and commit to R&D for innovation. By doing so, a high value-added, knowledge-intensive economy would be created that would be difficult to replace. This will enable Taiwan IC companies to further develop their existing strengths to create new business opportunities.”
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