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grzy
So it is clear intel is not getting into the foundry biz so discussions about ...
sranje
Wafer processing has entered an entirely different phase – can anybody explain ...
Six hurdles Intel must clear to be a major foundry
Junko Yoshida
5/1/2012 1:48 PM EDT
What are Intel's weaknesses as a foundry?
Clearly, Intel lacks experience of running fabs as foundries. "Intel can spend a lot of time with their current customer base to perfect the product because they don't have many customers," said the Semico analyst. "It'll take time to figure out their approach if their customer base expands to more than 10 customers."
Having laid out Intel's strengths and weaknesses as a foundry, we considered specific issues that potential customers may have with Intel as a foundry. Below are six things to keep in mind before jumping on the Intel's foundry bandwagon, six hurdles Intel must overcome if the company is truly committed to becoming a full-fledged foundry.
1. Transition to another process technology is painful
For chip vendors already familiar with a TSMC-compatible process, the most painful part of the transition will be from the current foundry to Intel. Persuading customers to switch to Intel's foundry won't be easy. "Moving to Intel means adjusting to a different process, new design rules. The transition will take time," explained Itow.
2. Intel's wafer cycle time
In reader feedback posted to our Achronix story, one "con" was that Intel''s wafer cycle time would increase if its fab reached maximum capacity. Itow said, "That is a common perception, but is not really any different than what is going on at TSMC today. The foundries have learned to live in feast-or-famine cycles. Allocation is something that foundries and their customers have learned to work around."
3. Intel's fab is fine-tuned for high volume production of a single product
This is the most cited concern industry players expressed about Intel as a foundry. "Intel has fine-tuned its production facilities for a high volume, single product focus. Foundries such as TSMC and Globalfoundries have to make a lot of different products for hundreds of customers," said Itow.
4. Support for third party IPs?
Then there are IP issues. "Foundry customers today require third party IP to support their SoCs and usually gain early access to tools, IP and design kits through the foundry," Itow said. Naturally, there are concerns. "Large customers may feel threatened by Intel's ability to control their access to capacity and technology," said Itow. Without question, that's a big problem for Intel. "As with Samsung, Intel will have to overcome any perceptions that Intel is a competitor," Itow added.
5. How open will Intel be?
"Today's foundry is well equipped to provide up-to-the-minute information on production status," observed the Semico analyst."Intel may not have the programs to keep their customers up to date on product yields, status, etc."
6. Will Intel be in the foundry business for the long haul?
This is $64,000 question. How serious is Intel about serving the semiconductor industry as a foundry? "Intel is known for entering into new markets, only to exit after a few years of dabbling," said Itow. "I'm sure Intel will serve existing customers, but whether this truly becomes a priority to Intel is yet to be seen," Itow said. Samsung has been working on their advanced technology logic foundry services for over six years, and when they started they were very clear about their goals and strategy, she added.
Clearly, Intel lacks experience of running fabs as foundries. "Intel can spend a lot of time with their current customer base to perfect the product because they don't have many customers," said the Semico analyst. "It'll take time to figure out their approach if their customer base expands to more than 10 customers."
Having laid out Intel's strengths and weaknesses as a foundry, we considered specific issues that potential customers may have with Intel as a foundry. Below are six things to keep in mind before jumping on the Intel's foundry bandwagon, six hurdles Intel must overcome if the company is truly committed to becoming a full-fledged foundry.
1. Transition to another process technology is painful
For chip vendors already familiar with a TSMC-compatible process, the most painful part of the transition will be from the current foundry to Intel. Persuading customers to switch to Intel's foundry won't be easy. "Moving to Intel means adjusting to a different process, new design rules. The transition will take time," explained Itow.
2. Intel's wafer cycle time
In reader feedback posted to our Achronix story, one "con" was that Intel''s wafer cycle time would increase if its fab reached maximum capacity. Itow said, "That is a common perception, but is not really any different than what is going on at TSMC today. The foundries have learned to live in feast-or-famine cycles. Allocation is something that foundries and their customers have learned to work around."
3. Intel's fab is fine-tuned for high volume production of a single product
This is the most cited concern industry players expressed about Intel as a foundry. "Intel has fine-tuned its production facilities for a high volume, single product focus. Foundries such as TSMC and Globalfoundries have to make a lot of different products for hundreds of customers," said Itow.
4. Support for third party IPs?
Then there are IP issues. "Foundry customers today require third party IP to support their SoCs and usually gain early access to tools, IP and design kits through the foundry," Itow said. Naturally, there are concerns. "Large customers may feel threatened by Intel's ability to control their access to capacity and technology," said Itow. Without question, that's a big problem for Intel. "As with Samsung, Intel will have to overcome any perceptions that Intel is a competitor," Itow added.
5. How open will Intel be?
"Today's foundry is well equipped to provide up-to-the-minute information on production status," observed the Semico analyst."Intel may not have the programs to keep their customers up to date on product yields, status, etc."
6. Will Intel be in the foundry business for the long haul?
This is $64,000 question. How serious is Intel about serving the semiconductor industry as a foundry? "Intel is known for entering into new markets, only to exit after a few years of dabbling," said Itow. "I'm sure Intel will serve existing customers, but whether this truly becomes a priority to Intel is yet to be seen," Itow said. Samsung has been working on their advanced technology logic foundry services for over six years, and when they started they were very clear about their goals and strategy, she added.
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any1
5/2/2012 9:22 AM EDT
I think that the consensus is correct. For now Intel is just dabbling in the foundry business. They can dictate the terms of their current foundry relationships. But who knows what the future holds. Intel can and should leverage their leadership in process technology and manufacturing know how to achieve strategic advantages and improve the corporate bottom line.
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junko.yoshida
5/2/2012 5:53 PM EDT
True. Actually, Intel's entry in the foundry market does make a good "long-term" business sense, in my humble opinion.
Intel transitions its processor technology every two years.
As Semico's Itowh said, "In the 1990's, Intel migrated their older fabs to chipset production or flash production in order to extend the life of their fabs.
"Today, they have to upgrade fabs or build new fabs. The foundry 'sweet spot' is typically one or even two nodes behind Intel's leading-edge processor technology," Itow added.
So, why not getting into the foundry business now -- in order to pay for the future investment?
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grzy
5/2/2012 3:44 PM EDT
Clearly everyone is missing the boat on this. Intel is ahead on process technology, behind on mobile. There desktop market is declining, there server market will decline as the cloud build out ramp completes. What can they do? Get into the fpga business. So Achronix is a takeover candidate, they are just waiting to see if it works. think 5 years from now Xilinx and Altera are struggling with TSMC to get the next gen devices out, while intel can dominate in power/performance b/c of there process lead.
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Frank Eory
5/2/2012 4:22 PM EDT
But it takes a lot more than process technology to succeed in the foundry business. Most particularly, it requires pre-packaged, proven IP libraries -- everything from standard cells to I/O cells to memory compilers to common analog blocks like PLLs, LDOs and data converters.
You can't just hand a customer a PDK and a DRC deck and say "call us when you're ready to tape out."
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junko.yoshida
5/2/2012 5:58 PM EDT
I agree. Intel will clearly face a long, uphill battle -- both in terms of potential customers'"perceptions" on Intel as a foundry; and what Intel can deliver as a grown-up foundry service company.
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junko.yoshida
5/2/2012 5:55 PM EDT
I wouldn't go that far... but we do hear consistently rumors about other FPGA vendors may be interested in working with Intel.
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sranje
5/2/2012 6:19 PM EDT
Wafer processing has entered an entirely different phase – can anybody explain to me why these speculations on if/when will Intel enter foundry business?
Intel is now ahead one FULL node of the industry – it is in HV 22nm while “all the leading foundries” (a crowd of one) are still ramping 28nm. This is an entirely new situation – even way before the arrival of 450mm wafers.
In 2014 Intel will introduce Airmont CPU core for its 14nm platform – this will be entirely new situation of almost two nodes ahead. All ARM-based vendors of processors for Smartphones are no longer laughing at Intel as a major application processor vendor for Smartphones. Which foundry can even dream to keep the pace? Another IDM, Samsung, very likely can, however.
The company has laser-focused on the leading phone and infrastructure vendor in China and on the largest smartphone market (China again) – see today’s formation of a joint lab with Huawei for accelerating implementation of LTE (4G) TD technology (a China standard at par with FM standard in 4G).
Why would Intel want to enter the foundry business – except for “pipe-cleaning” with small FPGA start-ups or with a single mega-company (Apple) with whom it already has very close relationship? Same logic for Samsung – except for mega-customers a la Apple or Qualcomm.
There is a perhaps more pertinent topic – how far will foundries expand into IC packaging.
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grzy
5/2/2012 8:16 PM EDT
So it is clear intel is not getting into the foundry biz so discussions about that are sort of irrelevant. These are "business relationships" of some kind.
The other thing to keep in mind is the end of moore's law. When you consider this it becomes apparent that at some point sooner rather than later we will go through a contraction followed by consolidation. Fact is Moores law will end, carbon nanotubes, 3d chips, etc will not mitigate that. Given that, you start thinking out 5 to 10 years then you see mobile chip sales decline due to lack of new features b/c lack of more silicon space, ditto for everything else. But you can see that there is still lot's of $ to be made and one of the consistent demand areas will be FPGAs since it is the one place the majority of companies can still play since tapeouts will still be expensive. It's all about consolidation and it appears to me they are on the ball. Now they have to figure out there mobile missteps.
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