SAN JOSE, Calif. -- Faced with the ongoing IC downturn, chip makers are cutting jobs, slashing forecasts and beginning to spill red ink.
Not at Open-Silicon Inc. (Milpitas, Calif.). After obtaining some funding in 2008, the privately-held fabless ASIC house has seen its fortunes rise and is bucking the trend amid the downturn. The company claims that it is seeing growth, grabbing new customers and is even hiring in select regions, namely in India and Taiwan.
Open-Silicon is also expanding its intellectual-property (IP) and technology offerings and is gearing up for the 45-/40-nm ASIC era. And it appears that the company can weather the economic storm. Early last year, Bahrain's Unicorn Investment Bank B.S.C. acquired a 75 percent stake in Open-Silicon for $190 million.
"Business is booming,'' said Naveed Sherwani, the upbeat co-founder, president and CEO of Open-Silicon. "We seem to be enjoying the windfall of the current recession.''
Fabless ASIC houses like Open-Silicon and others claim they can develop and manage an ASIC project at a less expensive rate than if customers did it themselves. It can manage and supervise an ASIC project from design, manufacturing, packaging and final test. Fabless ASIC houses do not own fabs, but rather they rely on foundries. But like all ASIC houses, the fabless group develops their own IP and other technologies.
In the current economic downturn, a growing number of companies are embracing the fabless ASIC model. The problem at many companies is resources, especially within ASIC design teams, which are under pressure to maintain their product schedules, Sherwani said.
Even though the IC industry is experiencing layoffs amid the downturn, companies are not standing still and are moving forward with their next-generation designs, he said.
Faced with waning resources and lack of expertise in outsourcing, Open-Silicon claims it can help chip makers and OEMs in tough times. ''In my career, I have not seen (the industry) this bad," he told EE Times, ''but (chip design) projects are still happening.''
There are a number of fabless ASIC houses in the market, including Altera, eASIC, eSilicon, Faraday, Global Unichip, Open-Silicon and others. Still, the overall ASIC market is dominated by the integrated device manufacturers (IDMs), such as TI, IBM, STMicroelectronics, NEC, Freescale, Sony, Toshiba, Renesas and others.
For years, chip makers and OEMs dealt with IDM ASIC vendors, considered the traditional approach in custom design. IDM ASIC vendors have their own fabs, EDA tools, and, in some cases, internal design teams.
The IDMs dismiss the fabless ASIC model, saying it is simply not practical. The fabless model did indeed take much longer to get off the ground than previously thought, but now vendors appeared to have made the right bet.
Many IDM ASIC vendors are struggling and losing money. The problem with the IDMs is that they have huge overheads, especially in running a costly fab. And, of course, ASICs have become increasingly expensive.
In terms of fab overhead, fabless ASIC house has an advantage. ''We're a leaner and meaner version of the ASIC competition,'' Sherwani said.
On the other hand, IDM ASIC houses may have an advantage in bleeding-edge designs and bringing design and manufacturing teams under one roof. Overall, though, there is room in the market for both IDM and fabless ASIC houses.