A system-on-chip (SoC) is the integration of functions necessary to implement an electronic system onto a single substrate and contains at least one processor. The only real difference between an SoC and a microcontroller is one of scale.
The integration of multiple blocks onto a single substrate has multiple advantages including cost and lower power consumption. However, the integration does at some times bring about compromises. The design and implementation processes used to create digital circuitry is not ideal for the creation of analog components and many types of memory use slightly modified processes in order to achieve maximum efficiencies. However, the advantages of integration usually outweigh these compromises.