Who’s In Control?

A changing economic and technological landscape will create significant power shifts in the semiconductor supply chain.

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By Ed Sperling
A power shift is under way across the SoC world that ultimately determine who wins the business, who gets the biggest share and what technologies are ultimately used to get there.

Complexity has reached a point where being able to pull the necessary pieces from a disaggregated supply chain is becoming much more difficult. That helps explain why all three of the major EDA companies now offer IP in addition to a slew of adjacent services. It also explains why Intel acquired Wind River and why Apple is now re-aggregating into a vertically integrated device manufacturer.

This complexity began rearing its head at 65nm, when issues such as power, silicon stress and third-party IP integration became rampant. At 28nm there are other physical effects to consider, and at 20nm and into stacked die there are a slew of other issues ranging from packaging, power budgeting, modeling, more complicated test and complex IP integration—to name a few.

Normally this would force re-aggregation of a supply chain, and there are some examples of this happening, but the economics of reaggregation are unusual in an industry where building a state-of-the-art fab now costs upward of $5 billion and where a large 100 million-gate design can pass the nine-digit mark for the first time.

“Most industries would vertically integrate at this point,” said John Bruggeman, chief marketing officer at Cadence. “But in this industry the economics of the different segments are so dramatic that vertical integration will not solve the economic issues. It would solve the technology issues.”

Within that framework, much tighter groups will emerge—cabals is probably a more accurate term—of large companies with deep pockets sharing common interests. They also will share much more of their technological know-how with each other, something that they currently refrain from doing in the design world for fear of theft of corporate secrets. Bruggeman said this is only beginning in the design sector at 28nm, but at 20nm or 14nm it will become necessary for survival.

“You will see power battles emerge, but they won’t be effective groupings until they realize no one will be the general contractor. There will be two main ecosystems—star IP and foundries—and EDA will connect them together. Companies like ARM cannot connect to TSMC without EDA.”

Foundry battles
Much of what will unfold will mirror what has happened on the manufacturing side, where foundries have set up their own ecosystems. The most complex one is the Common Platform and the Fishkill Alliance, which were started by IBM largely as a way of spreading out the very expensive process development across a number of companies that had deep enough pockets or technological expertise to contribute something.

The core members of the Common Platform—GlobalFoundries, Samsung and IBM—have been building up their expertise for next-generation chip manufacturing since the 90nm process node. TSMC has formed its own smaller ecosystem for similar reasons, striking up strong relationships with EDA companies.

It remains to be seen how those collaborative efforts will fare, however, against Intel’s vertically integrated model. Intel’s announcement that it will introduce FinFETs at 22nm—probably later this year—has set the whole manufacturing sector abuzz about whether the technology will be manufacturable, whether it will offer promised gains in power savings and performance, and whether their own developments will be competitive. Intel’s FinFET rollout is about two process nodes ahead of schedule.

Stacking effects
The other kind of 3D—stacked die, whether using an interposer or a TSV—is likely to create new issues about who owns what. Two good die may equal one bad stacked die, which is a problem when they are being put together. Heat, thinner substrates and noise can all have disastrous effects on signal integrity and performance.

“There is an issue of who owns the problem,” said Sunil Patel, principal member of the technical staff at GlobalFoundries. “We have not productized any of this yet, so it will all be played out over time.”

He noted that a much closer collaboration will be necessary. “This is not the old model of a GDS-II file where you expect a fully functioning package. It may not work. We all have to work together on what is now a back-end process. That’s a different relationship between customers and foundries. We have to understand the key deliverables for every die.”

Software vs. hardware
There has been much talk about who’s going to be in control of designs, hardware or software engineering teams. The answer is probably both.

Bridging hardware and software design sounds logical enough on paper, but more than a decade after this idea first began receiving attention it has achieved only modest success. So what’s holding up the process?

The real challenges stem from a rather complex combination of technology and business. While there is plenty of reason to align hardware and software development much more closely from a system-level standpoint—it can certainly improve performance and boost energy efficiency, for example—some key pieces have been missing.

“The software guys are used to getting a static hardware model,” said Mike Gianfagna, vice president of marketing at Atrenta. “There needs to be a balancing of software and hardware, but some of the pieces still need to be developed. We need modeling and simulation for both. We don’t believe a hardware-centric world will be successful. The software guys need to help drive architectural decisions. That is a new opportunity for both sides.”

He noted that software engineers currently have no way to communicate their concerns back to the hardware team. “What if you could take a generated model and send back the list of what they did and didn’t like and 24 to 48 hours get a new design? That would make a big difference.”

It also would help ease some of the stress about who should be in charge and how communication will work across disciplines that don’t necessarily speak the same language.

Make vs. buy
The other piece of the puzzle in a control shift is what actually gets used in a design. With IDMs such as Intel and Apple, there’s no question about who owns the design and who makes the pieces. For the rest of the industry that isn’t the case.

“We’re seeing a value inversion,” said Jack Harding, chairman and CEO of eSilicon. “The best companies can’t understand what other companies are doing unless it’s their job to know. For most companies, do-it-yourself is dead. No one can make one 28nm chip a year and be successful at it. You may come up with a solution, but it very likely will be sub-optimized.”

What’s interesting about this model—one shared by companies such as eSilicon, Open-Silicon and Global Unichip—is that the expertise is shifting from companies that design the chips to companies that actually put them together. The designers don’t work closely enough with the assembly to understand the intricacies of the technology, and the cost of developing the IP and subsystems is too high.

Stacking of die potentially removes that level of understanding by an entire die, which ultimately will be bought and sold as a complete, integrated subsystem. In that case, the real value may be less about the individual pieces of the technology and more about the tradeoffs between business and technology. Companies that get this right may be the biggest beneficiaries, while companies that develop the technology in a crowded market may find their market position severely eroded.

Conclusion
The changes that will be wrought over previous process nodes were mostly about technology—putting more on a chip, using technology to add unbelievable complexity and push the limits of physics. The next wave of changes will be as much about the intersection of business and technology as about advancing Moore’s Law.

As these changes unfold, there will be winners and losers, and there will be some companies squeezed out while others gain a toehold, a foothold, or win market dominance. But as these worlds converge—hardware, software, manufacturing, merchant IP and the business of all of these the semiconductor design market will be redefined for the next phase of growth. In some respects this is a normal business cycle, but change is always unsettling, unexpected and not of equal benefit to everyone.