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I attended an outside board meeting this week. During the down time some of the other directors and I were discussing the state of affairs in the industry. Let’s face it, as Rodney Dangerfield said in Back to School, “It’s a jungle out there.” I made the comment that while I am inclined to dissuade young folks from going into the semiconductor industry, for us older guys, it couldn’t be more fun.
I’m not sure either point is right. After all, we continue to face and resolve some of the most challenging technical problems on the globe. What fresh out wouldn’t love to be part of that? Conversely, why do we veterans get so excited about shrinking ASPs and geometrically increasing risk? What’s with that?
I subsequently realized I was on the wrong vector altogether. It’s not about young vs. old, new vs. traditional. Instead, it’s everything about working in a community, a very small community, of innovators that consistently work miracles and place the equivalent of a large city onto a microscopic nay, picoscopic, grid that will perform the functions of a data center from just 20 years ago. That’s why I love it.
Sure, acquisitions are consolidating the landscape at an increasing rate. The big are getting bigger…and they should. It’s their right as the conquering armies. But, let’s not confuse that with the daily conquering of technological challenges that raise their ugly heads with each new, bigger, badder IC. In this sense, the conquering army may be a ten-person company funded with $500K of angel investment. The conquered may not be a company but, rather, an unpredictable physical behavior in a 28nm SOC.
Either way, young or old, we are conquerors and slayers; masters of a universe that transcends the better part of humanity. We are an entire industry, a fraction of the size of Wal-Mart, that delivers wht may be the greatest value in the history of mankind, and we do it with predictability, practicality and enough collective profits to come back and fight another day.
It’s obvious that there is no longer a green field opportunity for our next generation to found Intel or AMD, Broadcom or Qualcomm. But there is an undeniable opportunity to take barely 50 years of head start and leverage it to what might be, finally, the total and ubiquitous deployment of semiconductor technology, not just to every corner of this planet, but, quite literally, to other planets.
So, to those people, of all ages, who want to change the universe, I say welcome to the semiconductor industry. Buckle up…
No technology remains forever. The venerable buggy whip gave way to other forms of vehicular acceleration. Similarly, the very fabric and namesake of Silicon Valley may be under assault.
One of the few technical tenets of the semiconductor industry that has crossed over into mainstream vernacular is Moore’s Law. Not really a law, it’s a profound observation that the density or complexity of chips doubles every 18 months. For decades the notion has guided the strategy and investment of an entire industry. A key attribute of this, to date, inevitable advancement is that the cost per gate of silicon is less with each generation. Many predict now this is no longer the case. As the bleeding edge processes are deployed, it appears that the cost per gate on silicon is actually increasing.
Is this the end of Moore’s Law? Not quite yet. The concept is likely to continue to hold water, uh sand, for at least another generation or two. That said, the relentless march towards lower cost and greater efficiency may have been trumped by the physical limitations of electrons flowing through silicon in the same predictable way the industry has come to expect for over 50 years; transistors are about to cost more for the first time since the first one was built in Bell Labs in the ’50s. Further, the actual cost to design each new chip is growing at near geometric rates. Fewer (albeit larger) are being attempted each year.
So, I guess that means Silicon Valley can close up shop. Well, no. The worldwide appetite for semiconductors increases, seemingly, daily. But the world won’t be so thrilled about paying more money for less area. What will fill the void?
If nothing else, the semiconductor industry is renowned for some of the world’s boldest innovations. It has solved countless problems dating back to its inception with uncanny predictability. One could conclude that it’s the very challenges inherent in the semiconductor development process that have resulted in the breakthroughs that, today, enable a microelectronic revolution that reaches every corner of the globe.
As an example, one solution among several is, so-called, 2.5D packaging. Essentially, this technology allows for the simultaneous use of old and new chips in one complex package. It’s gaining favor because it can facilitate reusability, sharing among developers, lower development costs that match application needs and improved time-to-market. It may or may not be cheaper depending upon the amount of technology it aggregates from the entire system: absorbing memory and IO, and reducing the system footprint. However, it does allow the developer to retreat from the bleeding edge of chip development; the same edge that is challenging the economics of Moore’s Law and otherwise causing the semiconductor industry to pause and reevaluate its R&D investment strategies. It may provide an alternative to developing smaller and smaller transistors at increasing cost.
In any case, innovation is the life force of the semiconductor industry. Moore’s Law is the proxy for the greatest run in the history of modern product advancement, but that run may be showing signs of financial diminishing returns. However, the creativity and tenacity of the engineering community may carry the day one more time as the once-pedestrian chip package, in the form of 2.5D, becomes the enabler of a much better understood and sexier slice of silicon.
Time will tell. But don’t be shocked one day to hear we’ve spent our lives working in Packaging Valley…
For a technical take on 2.5D packaging, please visit our Package Matters blog.
It’s the election season. The race for President of the United States is on.
Pick up any newspaper and one is already overdosed with the Republican candidate shucking and jiving to become the presidential nominee, and the early Democratic responses are planting media-fed land mines designed to derail the president’s competition before it is even selected. Politics is a full contact sport and it’s just about now the gloves are coming off; the winner being the one who can take the Rocky Balboa beating in a designer suit.
Personally, while generally interested in politics, I find myself awaiting the results of the earliest primaries to anoint the Republican who will face off with President Obama. I have my own opinion about the candidates from both parties but recognize our system selects the opposing nominee long before I get any say, living in California. In other words, while imperfect, some small subset of Americans will select, in this case, the Republican challenger for the Oval Office. I suppose I could move to Iowa or New Hampshire if I wanted more of a voice, but I’ve come to accept the process, flaws and all, and believe “the system works,” regardless of the party of the incumbent. Iowa, New Hampshire or South Carolina, I have the choice to be an early influencer if I so desire, and if I don’t, well, that’s my choice, too.
The election is a long way away measured in months, speeches, dollars, drama…and wafers.
Yes, for the semiconductor industry the election hopefully occurs in the midst of our industry’s return to the secular growth following the two to three seasonal quarters of “correction” and “inventory management,” code words for “we’re selling less than we expected.”
I’ve read many analyst reports calling for the second-half return of semiconductor growth and in a sustainable way. Phrases like “tail wind” and “global, secular demand” punctuate generally upbeat predictions for our industry’s next big chance to satisfy the consumer and bandwidth product consumption that drives our collective bottom line. In a way, we’re somehow relegated to awaiting that demand. In another way, we are not.
Policy decisions for the semiconductor industry cannot solve the recessional pressures. But they can soften the landing. The Global Semiconductor Alliance (GSA) exists to facilitate growth in the best times and downside management in the worst. It offers programs, working groups, technology advances and best practices to its members to manage their businesses with relevant information and many more resources.
Deciding what resources are available to the industry is the purview of the GSA management and its board. Experienced leaders from around the world team up to steward the organization and add their unique experiences to create a portfolio of advice, wisdom, serious debate and valuable programs. It’s been my great pleasure to be a part of that team for the past five years; a role I have valued personally and to which I have attempted to repay with value of my own.
It’s also election season at the GSA.
Hardly comparable to the race for the White House, scaled down to a tiny $300B industry, the role of the GSA Board member is of great significance to the management of our community of semiconductor-related companies. Unlike the national elections, we candidates are respectful and civil towards each other. But, we value our contributions proportionately as much, and for good reason. There is much at stake as we function in an uncertain global economy with uncertain political outcomes.
I am seeking reelection to the GSA Board. Please help me reduce the uncertainty in the semiconductor industry by voting for a passionate and serious contributor to the GSA, and a supporter of those policies that will help us to weather the outcome of much larger elections, and the challenges that go with them.
[ More about Jack Harding ]
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