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To Stay Alive, Renesas Negotiates End-of-Life Deals

8/7/2014 11:25 AM EDT
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The MicroMan
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Facing reality
The MicroMan   8/7/2014 12:44:12 PM
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It is refreshing to hear an exec present the honest reality of how hard it is for a semiconductor company to hold onto its business and maintain profitability.  The public may benefit and be amazed at the advances and cost reductions they see in everyday electronics, but keeping the machine running that drives Moore's Law is a huge burden, and much of it falls early in the food chain to the chip companies.  Unfortunately, the loss of jobs for so many people is an ice bath, especially in a culture that still assumes long-term employment to loyal workers.  But, that was a shattered expectation we've had to survive here in the US (and Europe) over the last decade.  The world has changed. 

Now, where do I buy the MCU to replace in my 20 year old car?

junko.yoshida
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Re: Facing reality
junko.yoshida   8/7/2014 4:23:22 PM
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@The MicroMan, thanks for your comment. I must say that although this is the first time I met Mr. Sakuta, president of Renesas, his very straightforward (and no nonsense) assessments on Renesas throughout the press conference (and an elevator ride with him) left a big impression on me.

 

cpetras991
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Re: Facing reality
cpetras991   8/8/2014 12:11:52 PM
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przem
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Re: Facing reality
przem   8/8/2014 12:40:40 PM
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When we needed an obsolete chip (9315 timer IIRC) we found that it was sourced by Rochester Electronics, a company that specializes in manufacturing designs abandoned by their original maker.

Couldn't Renesas hand off their customers to Rochester?

 

The MicroMan
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Re: Facing reality
The MicroMan   8/8/2014 1:37:01 PM
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It must be particularly hard for a man in a culture where one's word is his honor, like Japan, to have to wrestle with these business decisions that are EOL.  He's very bold to face the customers so directly.  Maybe here in the US we've gotten used to the dismissal "it's not personal, it's business", or analysts like me hearing vendors say "we understand our customers need a consistent supply for 7 years, so we assure that when we say 'embedded'".  Yeah... right!  And with the fast pace of process evolution, when they remove the 150mm 1.5 micron equipment, you can't just run the same masks on 200mm 90nm.  There're also the test systems and packaging, let alone the quality and reliability that may be inherent in very specific techniques that may not be replicated in some foundry, foreign land, or even Rochester.  

As for rolling your own replacement, whether an ECU or MCU, the code would be a killer to get right – or even to read out of the original – let alone if you had to modify it for that new Bosch sensor or different cam shaft (old school).  Porting code from an 'HC11 to an RH850 will take more than a week in the garage.  As mentioned, getting the engine running smoothly and fuel burning cleanly is quite the effort even for the professionals.  These chips aren't just timers.  It hard enough trying to figure out what's really wrong when your OBDII throws a P0440 code.  It'll be as frustrating to have a $25,000 classic Camaro being disabled from a bum ECU as a brand new $50,000 Infiniti waiting for its $10 MCU to come from the earthquake-shaken fab.

No easy solution.  We made the bed we're laying in.

Etmax
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Re: Facing reality
Etmax   8/11/2014 6:50:48 AM
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@microman "It must be particularly hard for a man in a culture where one's word is his honor, like Japan," I consider myself someone who always honours his word, and it is one of the things I most admire about traditional Japanese. We should all do this. Re rolling your own CPU, I think the idea of having another company such as Rochester receiving the masks and be able to manufacture the parts exactly per the original even if for 2 or 3 times the price is probably a smarter proposition. Maybe the original manufacturer gets 5% as royalty and Rochester charges $15 for a $5 chip and suddenly you have a win-win situation for all. Even these companies that say they can't manufacture the part economically anymore they are basing that on the ridiculous premise that it needs to remain a $5 chip when it doesn't. Make one wafers worth an divide the cost of that between the parts on a wafer and sell them at that rate. We design a product that used a dual port RAM that Cypress no longer made andt hey said if we buy a wafer's worth they'l run one. They cost us $15 each instead of the original $2 but it meant we didn't have to redesign the boards and pay recertification costs it was a bargain. This was after it went EOL. That sort of committment puts Cypress on the top of the list of vendors in my books. (maybe it 2 wafers? I can't recall)

_hm
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Re: Facing reality
_hm   8/8/2014 6:36:04 PM
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@przem: Yes, that is very good idea and also used by many other semiconductor vendor. Also, last time buy can also be proposed to auto maker with deep pockets.

junko.yoshida
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Managing End-of-Life Products and Businesses
junko.yoshida   8/7/2014 4:30:07 PM
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Further refreshing to me was Renesas President's open discussions on how the company is managing end-of-life businesses and products.

Obviously, a lot of responsibility comes with such decisions and actions -- both on the part of the chip suppliers and their customers.

It's one thing to stockpile necessary MCUs ahead of the production of new models. As to to the MCU to be replaced in your 20 year-old car, that's a good question. Hopefully, the maker of your car model is thinking ahead!

?-??>
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Re: Managing End-of-Life Products and Businesses
?-??>   8/8/2014 7:36:27 AM
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End-of-life business decisions seem to cost a lot of money and effort. It's hard to hear the CEO of a big company say "If you're a customer, would you do business with a company who might go bankrupt?"


Japanese struggle so much (except maybe Toshiba) compared to 5 years ago.

junko.yoshida
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Re: Managing End-of-Life Products and Businesses
junko.yoshida   8/8/2014 11:51:42 AM
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@?-??>, indeed. Sakuta was quite blunt about that. Because Sakuta does not come from either Hitachi, NEC or Mitsubishi, he seems to be much more open, less partial, calling what he sees as is. I hope this is something Renesas has needed.

Sanjib.A
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Re: Managing End-of-Life Products and Businesses
Sanjib.A   8/10/2014 1:00:29 AM
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@Junko: I agree with you. The openness of Mr. Sakuta about the reality might draw the customers, otherwise unwilling to discuss EOL, to the discussion table to agree upon a migration path. Being in the industry for more than 15 years (as consumer of the ICs) I understand how difficult it is to handle the EOL for everybody in the chain: from the IC manufacturer to the system developer to the end customer. But when somebody is very frank in bringing the issue in front of everyone affected, the discussion could drive to a solution. The Renesas team should make sure that they have an easier migration path for their customers who are using those EOL products, so that the users of those MCU could migrate their hardware & firmware to the new chips with much less effort.

Krutsch
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what about infotainment?!
Krutsch   8/11/2014 10:47:35 AM
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I read the CEOs comment about infotainment but I still do not get what he wants to say. Are they looking to compete in this market or do they exit? Just saying they need partners is vague affirmation to say the least... What partners do you need to make an apps proc. , besides what they already had.

junko.yoshida
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Re: what about infotainment?!
junko.yoshida   8/11/2014 11:27:35 AM
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@Krutsch, unfortunately, Renesas isn't saying much at this point. What's clear, though, is that Renesas isn't interested in doing everything to create a so-called "eco-system" around their chip for in-vehicle infotaiment system. What specifics the "partnership" entails, however, remains to be seen.

Krutsch
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Re: what about infotainment?!
Krutsch   8/11/2014 12:28:40 PM
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It is a topic to follow in the future. It looks to me like more and more players disappear from this application domain... Many player in the apps processor domain changed focus from tablets to auto infotainment and cluster with the hope to get better margins. The question is if the auto market for such applications is not too small.  I am skeptical that automotive can sustain so many NPIs , some of the players will either target also other applications with the same device or will exit because the margins are bad.

junko.yoshida
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Re: what about infotainment?!
junko.yoshida   8/11/2014 2:47:41 PM
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@krutsch, totally agree. The apps processor segment is growing to be a really tough market -- whether for tablets or automotive markets. In fact, make no mistake. The margin for the automotive market isn't that much better either.

The MicroMan
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Rare EOL example
The MicroMan   8/19/2014 7:08:04 PM
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I'm proud to say I helped establish the 68020 microprocessor in numerous applications. Today, an announcement indicates a UK company in cooperation with Freescale has stowed away 68020 die and is selling them in packages for the defense/defence industry. I'm guessing these cost more than $5. But this processor first hit the streets 30 years ago and was very popular! That's a long life! The press release gives some insight (not on US site): http://www.e2v.com/news/e2v-releases-new-cerquad-package-for-68020-facilitating-the-transition-from-the-original-freescale-plastic-qfp/
You can't really put that effort in with every chip ever made. Each has its own demand and natural lifespan.

Susan Rambo
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Re: Rare EOL example
Susan Rambo   8/19/2014 7:33:25 PM
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Thanks, MicroMan. That's an interesting story.  EV2 wafer bank seems like a brilliant scheme to keep defense industry supplied with supposedly "obsolete" chip designs when the semiconductor industry moves on.

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