It's especially tough being an IC vendor these days. The development costs associated with EDA tools, masks and time are growing fast.
It's especially tough being an IC vendor these days. The development costs associated with EDA tools, masks and time are growing fast. The cost of access to leading-edge processes and fab capacity, whether in-house or via a foundry, is also skyrocketing.
As if those pressures weren't enough to make a vendor wonder why it's figuratively knocking itself out, chip vendors don't just sell ICs anymore. We've all heard the trite slogan, "We sell solutions," but it's really much more than that. Almost every IC now must come with a reference design or evaluation board, or the customer won't even consider using the part. Chip suppliers are increasingly in the business of delivering dozens or even hundreds of boards for design-in evaluation just to remain a considered vendor. Along with that requirement come all the unavoidable headaches of pc-board assembly.
Now there's a new twist: IC vendors are being pushed back further into their customers' supply chain. At a recent meeting with Guy Nicholson, director of marketing and applications at National Semiconductor's Display Group, I saw what I thought was a broken sliver of glass but actually was a multifunction display driver fabricated as an almost-transparent, unpackaged device measuring 0.9 x 24 mm. The FPD95120, which includes a deserializer, dc/dc converter, RAM and E2PROM, mounts on the top surface of the display glass, at the edge. It thus obscures almost none of the active display area while supporting the interface needs of the display.
Why is this development a change for IC vendors? As Nicholson explained, National now not only has to work with the mobile-device designer and the designer's end-product assembly house, but it also has to move further back into the supply chain and work directly with the vendors of the basic displays themselves. It's those display makers that must attach National's IC to the display glass, before shipping the display-plus-driver combination to the contract assembler.
The process has implications for both procurement and production lead times, as well as the number of players in- volved with completing the business deal and supporting the end customer.
Buffeted by the need to provide evaluation boards and to supply unpackaged ICs to bill-of-materials line-item suppliers, vendors may long for the good old days of general-purpose, fully packaged ICs sold off the shelf to any and all. But those days aren't coming back, and vendors that want the high-volume consumer market must embed themselves and their products more deeply into both the design process and the supply chain.