Connectivity Key To Growing MCU Market

“It is a truth universally acknowledged, that an MCU without connectivity, must be in want of a Wi-Fi.”

A picture paints a thousand words and for ambitious companies with microcontroller unit (MCU) technology, the picture below is very clear – market growth in IoT-oriented connected devices offers great opportunities. In a slow-growing market, each new design win requires the removal of an incumbent. However, the rapidly growing connected IoT market offers ideal conditions for dynamic companies to quickly gain market share.

Figure 1: ABI Research, Mobile Accessories and Wearables Market Share and Forecasts, QTR 4 2019

According to David McQueen, manager of ABI’s connected consumer devices research, the forecast data used in the chart shows that connectivity is set to increase across IoT and wearable device types, opening up a whole new level of user experiences and use cases, further boosting the addressable market for MCUs.

As such, MCU companies without connectivity cannot play in this rapidly growing sector. To compound the challenges, MCU gross margins have been under pressure for over a decade and are typically in the range 25 – 40%, unless highly specialized functions are included.  To achieve gross margins over 50%, one must add a rich feature set, specialty functions such as a high-performance ADC or suitable connectivity.

The good news is that adding such IPs can be straightforward. High-performance ADCs and DACs, for example, are readily available for licensing from multiple sources. While the thought of adding Wi-Fi may conjure up images of dealing with multiple IP vendors – one for Baseband, another for RF and a third for PMU (power management unit with DC-DC conversion) – Imagination Technologies offers all three from a single source. This will dramatically reduce the complexity and time needed to convert your MCU to a connected MCU targeted at this rapidly growing IoT sector.

Adding Wi-Fi, such as our iEW220, or Wi-Fi + Bluetooth Low Energy – iEB110 –increases both the IC selling price and gross margins. It also reduces the number of competitors in your sector.  If your existing technology is primarily digital or low-medium performance analogue, adding Wi-Fi need not be complicated.  A careful layout, supported by our experienced team, will get you to production silicon quicker than you might expect.

By adding a proven connectivity solution – pre-certified for Wi-Fi Alliance or the Bluetooth SIG – and an integrated power management unit, you will improve profitability, while reducing your customer’s costs at the system level.  For example, a space-constrained application, which needs a competitive bill of material cost, such as a residential HVAC controller, is a great practical opportunity. Current solutions typically need three ICs – MCU, Wi-Fi/Bluetooth Low Energy and an external DC-DC converter.

Addressing the system needs for such applications with a single connected SoC results in increased sales prices and increased profitability. It’s what we like to call a win-win for both you and your customer.