Adapting To Broad Shifts Essential In 2022

Change creates opportunity, but not every company is able to respond quickly enough to take advantage of those opportunities. Others may respond too quickly, before they properly understand the implications.

At the start of a typical year, optimism is in plentiful supply. Any positive trend is seen as continuing, and any negative is seen as turning around. Normally the later in the year that something is predicted means the less likely it is to happen. But there are usually some events that nobody was prepared for. The last couple of years have witnessed a number of these events, and this year is no exception. From the partial retreat of COVID, to a semiconductor slowdown — even though a shortage still exists in some parts of the global supply system — to war, and increasing geopolitical tensions and government interventions.

Companies that recognize these turning points early, and manage to change their focus or direction, often come out stronger or manage to capitalize on the change. Many of the changes happen as if in slow motion, but looking back on them, you realize they happened with amazing speed. One example of this is RISC-V, and another one, part way through, is heterogeneous integration.

Recovering from COVID
COVID brought business travel almost to a standstill. Conferences quickly adapted and became virtual, while remote work evolved from an experiment into a necessity. “While COVID did halt a lot of business travel, it is coming back,” says Simon Davidmann, founder and CEO for Imperas Software. “But in terms of working relationships, it’s very different. We do a lot of work on Zoom, and we do a lot more videoconferencing. We’re more productive. When you have to commute for two hours each day, people get stressed out. Now they have lunch with their family, and their quality of life is better. There are issues like camaraderie and being with other people. From an office point of view, everybody comes to the office every second week on a Wednesday. We have a day in the office. But people have to hot swap because it’s not big enough anymore for everyone. That’s fine. And then we’d go and do a social pub lunch — it’s about being social beings.”

Virtual events have allowed a lot more people to participate without travel. “Virtual collaboration has always been a major part of the RISC-V ecosystem, as RISC-V members from different countries work together to make technical strides across more than 81 workgroups,” says Mark Himelstein, CTO for RISC-V International. “Now that COVID-19 has started to ease, we’re seeing people and companies reinvigorated to meet in-person, since it’s hard to match the incredible energy of in-person gatherings. We’ve also seen a growing trend of hybrid events that allow even more people to learn and participate, regardless of where they are located.”

The industry is unlikely to go back to the way things were. “What we consider normal has evolved,” says Michal Siwinski, CMO for Arteris IP. “There were many experiments in the past associated with fully remote workforces, and each time the end takeaway was no, back to the office. COVID has shown, at least in tech, that people can do design innovation, and create the next level of electronics and the underlying code and silicon pretty effectively in that environment. Hopefully, as we are getting out of COVID more permanently, the new normal is a more balanced normal. For some tasks, there are advantages of actually being in the same office and having a whiteboard conversation. Conversely, there also are a certain number of tasks where people can be proficient from their home environments without having to waste hours in traffic. It’s not a question about coming back to normal. There’s a new normal that is perhaps a little bit more balanced and nuanced.”

One of the surprises during the year has been partial collapse of the social media companies. “Many of the Internet darlings overstepped, and their attractiveness is waning,” says Rich Goldman, director of product marketing for Ansys. “This is good news for our industry, because there’s much more awareness of the role of semiconductor and EDA.”

Marc Swinnen, director of product marketing for Ansys, noted that could help draw younger workers into the market. “It is no longer seen as a backwater where you’ll waste your time,” he said. “It’s seen as one of the central pillars of our technology infrastructure. Students will see it as a more viable career path than they have in the past, and that is one of the explicit goals of the CHIPS Act. This will take time, but we need to encourage a new generation of students to go down the EDA, IP, chip design path. A lot of the industry veterans are starting to retire, and it is not clear we have a good replacement strategy.”

Geopolitical
This year has been a big one on the geopolitical side, with increased trade tensions leading to a breakdown of the global economy, governments stepping up their funding of their technology industries, and a war in Ukraine. “While not completely unexpected, the trade war with China and the silicon restrictions on technology for China have gone further than I would have thought,” says Ansys’ Swinnen. “It was originally something the Trump administration did, and I thought it might be a temporary political situation. But it looks like it’s here to stay, and it has in fact deepened and broadened.”

It is not just products, but intellectual property that is at stake. “I worry about the money coming from China trying to lure academics and technologists,” says Imperas’ Davidmann. “There will be problems if they start buying up small companies to gain access to the technology. The British government recently stopped a small EDA company from being acquired by China.”

In fact, there are some people calling for a halt to some open-source work because this is being used as a conduit for technology into China.

Supply chain issues have certainly become amplified throughout the last couple of years. “People are looking deeper into the notion of controlling their own destiny,” says Frank Schirrmeister, vice president for solutions and business development at Arteris IP. “We have seen a lot of activity in automotive, where OEMs want to own their own destiny by building their own chips, or taking more control of those chips. We see these discussions intensifying, accelerating, and becoming more important in the design chain for everybody.”

That also extends to IP. “Many companies and countries have realized that they want to diversify their supply chains so they are not reliant on a single IP company for their entire silicon roadmap,” says RISC-V’s Himelstein. “RISC-V provides much more choice than proprietary architectures. As a result, many companies are either diversifying their product roadmaps to include RISC-V designs, or are designing exclusively with RISC-V. There also are a number of regions that are turning to RISC-V as part of their national semiconductor strategy, such as the European Union’s European Processor Initiative and India’s Digital India RISC-V campaign. These efforts are helping to drive RISC-V innovation in a variety of sectors.”

Will some of these regulations have any disruptive effects? “Too early to tell,” says Arteris’ Siwinski. “A lot of these companies are trying to innovate, and they will continue to find a way to innovate, because innovation is not going to slow down. And I don’t necessarily believe that any piece of legislation that any government is going to pass is going to stop innovation. Maybe the means in which it happens is going to change. Maybe the players that are supporting it are going to evolve. But again, technology innovation is going to continue no matter what.”

Business and investing
At the end of last year, early indications of a semiconductor industry slowdown were emerging. “The big, unexpected change in 2022 was the reversal in investor sentiment and appetite for risk,” says Steve Roddy, CMO at Quadric. “Venture funding, which was free-flowing and plentiful at the start of the year, is now much harder to come by. Companies in both the IP licensing business and silicon startups were impacted by the slowdown in the second half of 2022, with several companies shutting down as funding dried up. At the same time, the belt-tightening at the bigger semiconductor companies may turn out to be a boon for the healthier, innovative IP providers. Cost-conscious semiconductor companies may decide that licensing an IP block is wiser and more economical in the short- and medium-term than building in-house teams to replicate what is available off-the-shelf as IP.”

Design and innovation continues, regardless of the bigger economic picture. “Against the backdrop of the silicon slowdown, developers are stepping up to deliver improved experiences across a broad range of technologies, from automotive to mobile to IoT devices, to the data centers that take on the massive amounts of data produced by all of this connectivity,” says Gary Campbell, executive vice president in Arm’s Central Engineering group. “Of course, new technology eras don’t happen overnight. But 2022 has been a tipping point because of all the standards that have coalesced to make the job of developing innovative solutions faster and more efficient. This has become especially evident in sectors like automotive, as software is on the rise in all aspects of the vehicle, further emphasizing the need for standardization to help ease software complexities for developers. Initiatives like SOAFEE have made great progress in helping ease the automotive developer experience with reference implementations and enabling software reuse, for example.”

Change is often good, particularly when it comes to technology. “This is true no matter if the markets are driving things up and it’s a boom of some kind, or there are signs of markets contracting or some recession concerns,” says Siwinski. “What ends up happening is that people have an incentive to revisit existing processes and are driven to innovate. When the market goes up, things are great for technology. When the market goes down, things are great for technology. Change typically drives this notion to re-engineer the processes, re-engineer how things are done, and all this spurs a lot of new innovations.”

The slowdown is not across the board. “While some areas have slowed, there is still a lot of demand in the semiconductor area and a lot of companies are rethinking strategies after the chip shortages of the past years,” says Dave Miller at SiFive. “In the other direction, the CHIPS Act in the U.S., and other countries’ efforts to rethink the supply chain, already are creating new opportunities. Market uncertainties highlighted the need for stable supply chains.”

Some companies may look to make fundamental changes to their business model. “I was surprised by the acquisition of Tower by Intel Foundry,” says Ansys’ Goldman. “Intel traditionally has a ‘we know best’ mentality, but in foundry they went and acquired Tower, and if they do it right, Tower knows how to do foundry. That could help them a lot. The other big surprise is Suk Lee leaving TSMC and joining Intel. Suk knows how to build that ecosystem, so that could bode very well for Intel foundry.”

Design
Over the past couple of years, notions of domain-specific compute have been growing. “Bespoke silicon became part of the semiconductor industry vocabulary in 2022,” observes Michiel Ligthart, president and COO for Verific Design Automation. “Silicon design companies tailor their chips to their specific applications using existing methodologies and building portfolios of IP to differentiate themselves from their competitors.”

Another term that has been used a lot is democratization. “We are seeing a drive towards democratization of chip design,” says Ansys’ Swinnen. “Today, chip design is done by a small cadre of very high specialized, high priced, very advanced designers. But from the government’s point of view, the competitiveness of the United States will require many more minds to be applied, many more people to enter into the chip design field, EDA field, and all the related fields. To preserve America’s strengths into the future, they’re driving toward democratization, and the CHIPS Act has this as an explicit goal. This means making tools, IPs, and PDKs much more broadly available, bringing research and students in, letting people more easily design chips, and more people design chips.”

RISC-V is one of the key developments in this movement, and its success is causing an expansion into other areas. “I thought RISC-V would grow slowly,” says Davidmann. “I’m surprised by this speed of its acceleration and how much interest there is in verification.”

The lack of verification tooling could slow down RISC-V. “We see companies focused on retooling and looking for ways to make their development more efficient,” says Dave Kelf, CEO for Breker Verification Systems. “RISC-V clearly accelerated this last year with a lot of companies working on smaller embedded processors. In addition, larger, multicore RISC-V application processors and processor clusters are becoming more evident, and these are leading to greater verification challenges. RISC-V automated verification is becoming more important as processor developers strive to meet expectations created by established processor vendors.”

These verification concerns are not unique to RISC-V. “Verification is an open-ended challenge that is growing non-linearly with increasing complexity,” says Prakash Narain, president and CEO of Real Intent. “As a result, the verification effort has been growing as a percentage of the overall chip development effort. Our industry has succeeded in containing that growth by creating more powerful simulators and emulators and using massively parallel deployment. There are three traditional workhorses for early functional verification: simulation, formal verification, and static sign-off. Each of them must manage high design complexity and capacity requirements by supporting divide and conquer in the form of hierarchical analysis. Sufficiently accurate abstraction for hierarchical analysis requires custom hierarchical analysis needed for each application.”

Participation in RISC-V standardization activities continues to grow. “RISC-V is moving into the mainstream faster than most people expected,” says SiFive’s Miller. “Many thought it would stay relegated to embedded and other processing applications, but it has shifted to more critical and powerful applications, such as NASA’s High-Performance Space Computing program. Growth of the RISC-V International Foundation has been outstanding, with more than 3,200 members.”

The demands on IP blocks are in transition. “For users, applications are a central part of the overall device experience,” says Arm’s Campbell. “Looking at mobile as an example, real-world performance built around the application experience, rather than synthetic benchmarks, has come of age in 2022. This means a combination of efficiency and performance, and not just performance alone, to define the best possible user experience. The need for performance efficiency goes for the computing infrastructure sector, as well. The rise of energy prices and importance of climate change have really shined a light on the traditional approach to delivering more compute performance in the data center, underscoring the need for performance efficiency more than ever before.”

For other application areas, it can add a lot of new issues. “It is no longer enough to just give people the RTL for a piece of IP,” says Schirrmeister. “You have to consider other differentiating properties like safety, like security, like physical awareness. These all need to be taken into consideration, especially in the more aggressive technology nodes. Not really a surprise, but clearly a trend this year, which will probably accelerate and strengthen next year.”

The manufacturing technology roadmap has made significant advanced during the year. “2022 saw a huge uptick in 3D-IC and chiplet announcements,” says Bob Smith, executive director for the Electronic System Design (ESD) Alliance, a SEMI Technology Community. “These became viable options to further stretch the limits of Moore’s Law and called attention to the many opportunities for the silicon IP and system design automation tool ecosystem. Another obvious trend in 2022 was the move to advanced sub-10nm processes that exacerbated the need for advanced automation tools to support both the design, and verification for these leading-edge processes.”

But terminology can get in the way. “What has become clear this year is that true 3D, apart from HBM, is still a little way off,” says Swinnen. “The vast majority are 2.5D. The chiplet idea is definitely gaining steam, although it’s still a bit of a dream in the commercial space. They have a lot of the same issues as soft IP — how do I create a model, how do I interoperate with tools? Chiplets are going through the same growing pains.”

The costs and benefits associated with heterogeneous integration are changing rapidly. “The reason why companies will want to go there over the next few years is that the costs are about a third less,” says Siwinski. “The basic notion is that instead of pushing very large, single-chip devices, there are advantages in not pushing the size envelope and the correlated costs, and potentially do a little bit of a divide. This is a great example of market dynamics asking people to rethink, ‘Do I want to do my design the exact same way I did the last few chips, or do I want to revisit my options?'”

The standards necessary to support this kind of integration are progressing rapidly. “Throughout 2022, Compute Express Link (CXL) steadily gained traction,” says Maurice Steinman, vice president of engineering for Lightelligence. “CXL has emerged where CCIX, Gen-Z and OpenCAPI were unable to gain industry-wide acceptance and adoption. Though CXL has incorporated elements of these other protocols, CXL is the clear winner, fueled by data center needs for disaggregation and composability of heterogeneous systems. Universal Chiplet Interconnect Express (UCIe) also gained traction at the package level. The emergence of this open interconnect standard will give companies the necessary tools to easily deploy both homogeneous and heterogeneous multi-chip architectures.”

The biggest driver for advanced packaging is high-performance computing and data centers, but it is starting to reach a much wider market. “The one thing that that has caught me a little by surprise was heterogeneous integration,” adds Swinnen. “This is one of the benefits of 3D-IC, where you could use multiple different processes in the same system. You could use a memory process for the memory and an RF process for the RF and digital for digital. That has become more attractive than I thought, certainly for government contracts. They actually refer to the 3D-IC area as HI — heterogeneous integration is the principal attractor for them.”

Conclusion
There is no such thing as a typical year, and 2022 had several surprises. What remains the same is that technology finds ways to overcome problems, and people like to innovate their way out of trouble. It may weaken or even kill some players, but the industry always seems to emerge stronger at the end of it. As Arteris’ Siwinski says, “Change is good.”