Experts at the Table, part 3: New challenges with the IoT, industry consolidation and security.
Semiconductor Engineering sat down to talk about the future of IP with Rob Aitken, R&D fellow at ARM; Mike Gianfagna, vice president of marketing at eSilicon; Judd Heape, vice president of product applications at Apical; and Bernard Murphy, an independent industry consultant. What follows are excerpts of that discussion, which was held in front of a live audience at the recent Silicon Valley IP Users Conference. To view part 1, click here. To view part 2, click here.
SE: With the IoT, you typically want a semi-customized device. Does the IP model work for that?
Murphy: That’s not a new idea. Back in the golden days when everything was going to be solved by software, a number of companies were thinking about mega platforms where you have everything on there and you just turn off or disable what you didn’t want to use.
Gianfagna: Because silicon was free and who cares.
Murphy: Yes. This is a new spin on that idea.
Aitken: There were some that actually worked that way. In IoT Land, the theory is that there really do seem to be a lot of tiny applications. So you can either buy a standard part, and only use some of it. Or you can build the whole thing on an FPGA, but that probably uses more power than you want. Or you can try to do this yourself in some process like 180nm where small groups of people can make ICs without a lot of trouble.
Gianfagna: That’s a different market. It’s a market where people need a custom chip. They don’t know a lot about how to make one. But they need it really fast, with ultra-low power and it’s not that complex. But you have to put this stuff together in a way that’s novel, unique and fast. That’s an interesting market opportunity, but when is it real? Everyone is going to market now with an off-the-shelf part right now. When does that tip from off-the-shelf to a custom chip. Unfortunately, it feels a lot like 2.5D and 3D. It’s going to happen any minute in the next five years. I don’t know when that tipping point is, but it is more than 18 months from now.
SE: 2.5D is happening now, right?
Gianfagna: Yes, but we were talking about it 15 years ago. Finally it happened.
SE: Are we heading toward a platform strategy, where 80% or more of the chip can be done ahead of time?
Aitken: It depends on what you mean. So there were these guys from Stanford who conjured up something with image sensors and nanotubes and memory. It’s a decent product. However, they made six of them and it cost a good portion of Stanford’s electrical and computing engineering. If this market changes, this is kind of how it will change. It wasn’t exactly what you thought, but it’s generally along the same lines.
Murphy: Raspberry Pi-like objects for the IoT are a way to explore what might be possible. Then someone can jump on that and build a million of those.
SE: How will industry consolidation affect the IP market? And this trend good or bad?
Murphy: It’s neither good nor bad. It’s the way the industry evolves. Hopefully it evolves in a way that strengthens it and makes it more productive. And then, hopefully we’ll get to a stage where a whole bunch of companies will spin out and start doing new and interesting things.
Aitken: There are economies of scale and anti-scale. With economies of scale, you get synergies when you bring companies together and everyone will work harmoniously and you can get rid of half the infrastructure. The other part is an issue. As you get bigger, the threshold for interesting opportunities goes up. There was a panel on that at ICCAD a few years ago called, ‘CAD, a zero-billion-dollar industry.’ The reason for that is big companies evaluate industries to the nearest $10 billion, and EDA rounds down. For startups, the threshold idea is that if you create a company with an innovative idea, will someone buy it. But there also are problems in big company bureaucracy that are a challenge for any consolidation. Eventually you get to the point where everyone things it’s gone too far, and then it goes back the other way.
Gianfagna: It’s a pendulum. As an IP consumer, one thing we’ve seen is that there’s a very good part of consolidation. If you’re going to do these advanced IP blocks, you’re going to have to do a number of multi-project wafer runs, which are not cheap. You’re going to need a massive amount of quality assurance and validation for me to have a chance of buying what you built and making it work. If you’re a mom-and-pop shop doing a 14nm block, it’s very dicey. If you’re a large organization with the skills and the wherewithal to do that quality assurance, we’d feel better about it. The flip side is that the innovation engine can’t die, and not all of the innovation will come from the big companies in any industry.
SE: Would eSilicon buy from a very small company these days?
Gianfagna: We do that now, but only if they have something that is measurably better than what we would get from the big companies. If they do, we’ll take the risk or bite the bullet and do the quality assurance ourselves.
Murphy: As EDA shrinks, there is a possibility that more EDA will move in-house. Intel has quite a bit. Qualcomm has quite a bit. We may be at that stage of the cycle.
Heape: Consolidation is good and bad. The good part of it is as the industry consolidates, the good designers and engineers go to the top. We’re working with larger companies, so there’s a potential for higher volumes and royalties. The bad part is those designs are fewer and further between and they’re much more complicated. The other really bad thing, especially in the mobile market, is we had two application processor designs that died because customers decided to leave mobile or consolidated into something else. It’s disconcerting when you have a 16-week delivery cycle and the IP goes nowhere.
SE: How does security play in IP decisions?
Heape: Internally, we’re pretty paranoid about everything. We have a bunch of programmers from Eastern Europe who are very skilled in cryptography, so we know even which tools are more secure than others. Any customer of ours can become an enemy and take our IP and lock us out. So we only offer IP under certain methods and tools. We obfuscate on our own with scripts and obfuscation techniques.
Aitken: This is like asking whether the tire pressure gauge should send encrypted data? Well, maybe not. But if this is how data is applied when you pump the brakes and you’re a hacker, why not just play that data back on the network and see what happens. Even things that don’t look like they should have encryption turn out to be good candidates for encryption. You need lightweight encryption. You also need authentication. And then you have to deal with this massive mistrust environment. Managing trust, managing authentication, and proving this is a legitimate thing is a very hard problem.
Gianfagna: Security is a huge issue. The growth and reach of the IoT is happening exponentially faster than the security that’s required. Sooner or later something horrible will happen and then people will take it more seriously. It’s scary.
Murphy: It depends where you are in the food chain. Big companies will always do more. But if you don’t know your impact on the final security of the system, and particularly if you are not going to be compensated more for adding features that would make it secure, then you’re not going to make it more secure. Until companies better understand their role in security, they’re going to wait for someone else to tell them what to do. If liability ever trickles down to them, that will be a different story. But if the car crashes, which semiconductor is going to be sued? Probably no one.