SHANGHAI – Multinational chip companies who’ve consigned some of their design work to China tend to do so as quietly as possible; but a few leading companies are clearly making deeper inroads in China, and they’re not especially shy about it.
Texas Instruments is a good example.
Its newest MCU design center based in Shanghai recently saw its first locally designed device successfully taped out. While TI is not disclosing the size of its team, Scott Roller, vice president of TI Microcontrollers, in a recent interview with EE Times, described the MCU design center in Shanghai as “a sizeable team, with multiple designs going on.”
TI’s Shanghai-based MCU design center, whose operation started in early 2011, is the newest addition to the company’s three others worldwide. They include design centers in Germany, Bangalore and Dallas.
It’s important to note that TI’s facility in China is not there just to support existing MCU products. Rather, it actually executes some MCU product line development from China. “This is to develop MCUs – built in China for China,” said Roller. The design center performs every job – ranging from sales, application developers to system and processor designers and application field engineers – necessary to do the design work in one place. “We cover everything -- from front to back end,” said Roller.
Scott Roller, vice president of microcontrollers at Texas Instruments
Why design in China?
Asked why design in China, Roller gave two straightforward reasons: “First, you can move much faster. Second, by designing it locally, there will be less room for misinterpretation.”
Although in theory, that may make sense, not every multinational has gone that far in their public commitment to designing in China.
Earlier this month at the Freescale Technology Forum in San Antonio, Texas, Gregg Lowe, Freescale Semiconductor's new president and CEO, said the China market is in transition from a low-cost manufacturer of electronics products designed in the West to a true high-tech hub with the design capability to create products for its massive domestic market.
Chip vendors who want to sell products in China need a strong presence there, Lowe said. IC vendors don't necessarily need to design their products in China, but they need to have applications engineers and system engineers right there to be successful there, Lowe said.
The fundamental difference in China, however, is China’s speed, said Allen Wu, president of ARM China. Design cycles for SoCs in China are generally much shorter, he observed. “From design starts to tape-out, sometimes it takes only five to six months. [Local companies] make decisions much more quickly and they react to the market very fast.”
So, by the time multinationals finally reach a decision on a specific design back at headquarters, that may have already become irrelevant on the local Chinese market, explained Wu.
TI’s Roller stressed that TI did not build its MCU design center in China “because of the cost.” He said that engineering talents may be “a bit cheaper but you don’t really save money.” TI has done this “because we want to design and produce products closer to where the demand is.”
One of the biggest MCU market segments TI is after in China is a smart metering device based on China’s state grid program. TI taped out the first product and is sampling it now, said Roller. “This is a huge opportunity for us.”
TI’s two key MCUs used in China include MSP430 ultra-low-power 16-bit microcontrollers and C2000 32-bit microcontrollers.
Asked which other multinationals are commanding a strong presence in the MCU market in China, Roller mentioned Freescale and Renesas.
Freescale – with a long history in China – may be pulling back a little, TI’s Roller said. But he quickly added: “That may change with the new CEO,” referring to Freescale's Lowe who was ex-TI executive.
Freescale’s Lowe, while at TI, most recently led the Dallas-based company’s analog business. TI has already established several analog design centers in China.
At the interview held at the Freescale Technology Forum, Freescale’s Lowe acknowledged "Design decisions will move." He said, "You can't just go to Silicon Valley anymore. That's still a very important place to go, but you need to be in all of the places where chips are being designed into systems to be close to customers and understand customer requirements."-- Additional reporting by Dylan McGrath