A lesson from Ireland: Helping a busy OEM make the transition to system-on-chip can be more rewarding than being an outsource service provider for a savvy but pressured chip design team.
Silicon & Software Systems Ltd., otherwise known as S3 Group, has been a center of IC design in Dublin, Ireland, for more than 25 years. But the fast pace of technological and business change in the semiconductor business means that longevity is no guarantee of success. However, longevity does indicate a company that is prepared to adapt to survive.
As a company S3 does more than design circuits. It has business units in digital TV software and telehealth systems, which in a way reflect the origins of the company. It was originally set up by Philips Semiconductors as a remote design base in Dublin, so that it didn't have to keep relocating graduate engineers from Ireland to Eindhoven, Netherlands.
S3 has been independent of Philips and supplying mixed-signal IP and IC design services for many years but it has to remain flexible and be ready to adapt, Dermot Barry, vice president of silicon, told me in a recent telephone conversation.
Barry relates how 2008, a good year for S3, was followed by very poor 2009. He reckons that IP licensing enquiries had started to pick up again in 4Q09 but that the IC design service business took longer, until mid-2010. And there was a change that helped S3 climb back up. "The traditional customer base is semiconductor IDMs and fabless chip companies. That's changed. We started to go after the OEM companies," said Barry.
He makes the point that semiconductor companies have been under enormous pressure to reduce the cost of their chips for many consumer and mobile applications and that pressure has been pushed up stream. And in the design services business large Indian and Asian service providers, such as Wipro, have been driving down cost.
"We had to focus on our expertise in mixed-signal IP and looked to help OEMs who have electronic products but only in relatively low volume." These OEMs, used to taking standard components from distribution channels could not go to system-chip because they lacked the expertise and access to foundry, said Barry.
"By a mix of integration of repartitioning systems we've been able to achieve bill of materials savings." The volumes remain small but S3 works with foundry access aggregators such as eSilicon, Open-Silicon and Delta Microelectronics to help the OEMs get access to appropriate foundry processes and production volumes.
Barry makes the point that when talking with IDMs and fabless companies that are familiar with the design process the discussion can get focused on the price whereas with negotiations with OEMs can revolve around the value created in terms of savings in the system BOM.
It all goes to show that as an engineer, in terms of achieving the best return on your efforts, it is not only what you do that matters but also for whom you do it. And that taking the system and user-case point of view usually yields far more efficient and cost-effective solutions.
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