By Mark LaPedus
About every five years or so, a new and hot market emerges in the specialty foundry business that resembles a frenetic gold rush.

The last big gold rush occurred around 2008, when more than a dozen foundries jumped into the bipolar-CMOS-DMOS (BCD) market to capitalize on the booming power-management sector. Now, the next gold rush is centering on an emerging technology—the radio frequency (RF) silicon-on-insulator (SOI) market.

Today, IBM, STMicroelectronics and TowerJazz offer RF SOI foundry processes for the merchant market. Over time, analysts estimate that a dozen or more foundries could offer RF SOI. Altis Semiconductor and Grace Semiconductor have announced plans to enter the RF SOI fray. Two others, Lapis Semiconductor and Silanna, have put RF SOI on their foundry roadmaps. And sources indicate that GlobalFoundries, MagnaChip and TSMC are developing RF SOI or evaluating the technology.

Foundries are jumping on the RF SOI bandwagon amid a boom for select parts, particularly within the RF front-end for the latest smartphones and tablets. Typically, the RF front-end consists of power amplifiers (PAs), RF switches, tunable capacitors and filters. Generally, the PA and switch are based on gallium arsenide (GaAs), while the tunable capacitors and filters use various technologies.

RF SOI and its variant, silicon-on-sapphire (SOS), recently have made inroads for the RF switch—at the expense of GaAs. Most PAs are still based on GaAs, but the tide is slowly turning. For example, Peregrine Semiconductor is developing an SOS-based PA for a future smartphone at Apple, according to RBC Capital Markets.

Generally, RF chipmakers make GaAs-based devices in their own fabs. Chips based on RF CMOS, RF SOI and SOS generally are outsourced to the foundries. RF SOI is not a difficult technology to develop, but the real issue is that the sector could meet the same fate as BCD. As it turned out, the BCD market was not big enough to support a dozen foundries, prompting a shakeout in the arena.

In all likelihood, there is room for only a handful of RF SOI foundry players. “I would say IBM and TSMC are the only ones that have the economies of scale (in RF SOI),” said Doug Freedman, an analyst at RBC. “IBM is the leader in RF SOI right now, with TSMC trying to play catch-up. There are some other vendors like TowerJazz in the market, as well.”

From a supply/demand perspective, there is already ample RF SOI capacity to meet demand right now. “I have heard that capacity in RF SOI is adequate,” said Christopher Taylor, an analyst with Strategy Analytics. “I would have my doubts about the prospects of serious shortages barring compelling information to the contrary. Also, in light of the fact that RF SOI does not really push into the CMOS, small-node frontier, there is potentially quite a bit of capacity available from older fabs and foundries at the higher nodes.”

Rushing into RF SOI
The stakes are high, especially as RF content continues to increase in the latest mobile devices. In total, the PA market is expected to grow from $1.7 billion in 2008 to $3.8 billion by 2015, according to RBC. The multi-throw RF switch market is projected to grow from $262 million in 2008 to $1.2 billion by 2015, according to RBC. And the tunable capacitor market is expected to reach $500 million by 2016, it said.

“Driving this growth is rising handset and tablet units, which requires a greater amount of PA ICs,” RBC’s Freedman said. “Principally driving (RF switch) growth is rising radio bands. Driving (tunable capacitor) growth is the wider frequency range of bands and the need to reduce antenna size without performance trade-off.”

There is also an increase in design complexity amid a transition from 3G networks to the next-generation, 4G/LTE wireless standard. “LTE and carrier aggregation are thorny problems even in the best of situations,” said Michael Noonen, executive vice present of global sales, marketing, quality and design at GlobalFoundries. “You also want to be as Spartan as possible in the RF front-end design from a battery consumption standpoint.”

GlobalFoundries, which has been expanding its RF process offerings, is “very much interested” in RF SOI, Noonen said. “We have a lot of experience with SOI, but there are also other approaches in RF,” he said.

Indeed, OEMs face a series of complex device and process choices. For years, GaAs has dominated the RF landscape. GaAs has a larger energy gap and is faster than silicon, but it is more expensive to manufacture. RF CMOS, RF SOI, SOS and silicon-germanium (SiGe) are also in the mix. The RF version of SOI combines CMOS with a highly-resistive, thick-film SOI substrate.

RF SOI is an alternative to GaAs, with equivalent insertion loss and noise isolation characteristics. RF SOI also enables OEMs to integrate various chips on the same die. Another technology, SOS, makes use of an insulating sapphire substrate. And SiGe is built with silicon transistors to create RF circuits.
Meanwhile, after years of promises, RF SOI and its variants are finally cracking the RF front-end. OEMs are moving from GaAs pHEMT to RF SOI and SOS for the RF switch, said Paul Boudre, chief operating officer at Soitec, an SOI wafer supplier. “GaAs pHEMT will not disappear, but it will remain for more specific devices,” Boudre said.

Actually, the buzz started when Apple incorporated Peregrine’s SOS-based RF switches in the iPhone 5. Samsung’s Galaxy S4 and other smartphones are also using SOS-based switches, according to RBC. SOS is a proprietary technology that is only offered by Peregrine. Its SOS chips are made on a foundry basis by Lapis, MagnaChip and Silanna.

Rodd Novak, chief marketing officer of Peregrine, said SOS has better insulating properties than RF SOI. SOS also uses sapphire wafers, making it a more expensive than RF SOI. But the overall cost for SOS is declining. This is because sapphire wafers are ramping up in high-volume markets like LEDs, which will impact the cost of SOS, Novak said.

Peregrine recently rolled out a new version of SOS, based on 0.35-micron technology. “Before, we grew an epi (layer) on top of our sapphire process,” Novak said. “Now, we are taking a very clean silicon substrate and bonding that to the sapphire. That process enables better performance.”

Apple to drive SOI?
The fact that Apple and other OEMs have adopted SOS and RF SOI for the RF switch has given the technology some credence. It also has caused a stampede of foundry players looking to enter the RF SOI sweepstakes.

Now, with help from the foundries, RF chipmakers are looking to displace SOS-based switches with traditional and less-expensive RF SOI technology. “RF switches are typically based on GaAs pHEMT, SOS and SOI, with SOI gaining more and more market share away from the other and more expensive technologies,” said Marco Racanelli, senior vice president and general manager at TowerJazz.

In addition to cost, OEMs are also interested in capacity. In one effort to ensure supply, IBM recently signed a second-source foundry deal for its 0.18-micron, RF SOI process with Altis.

Besides the RF switch, the next big market for RF SOI and SOS could be the PA, with Apple emerging as the possible driving force. “We believe that Peregrine is developing a unique integrated PA solution that is targeting the next generation of Apple’s PA product needs,” said RBC’s Freedman. “(This) could add approximately $1.25 in content, assuming (Apple integrates) five to six single PAs in 3G smartphones. We note that in 4G, PA content opportunity rises to approximately $3.00 due to rising single chip PAs per device.”

In another example, Qualcomm recently rolled out the RF360, an RF front-end that includes a PA based on SOI. Today, however, the jury is still out for PAs based on RF SOI and SOS. For the PA, GaAs still has a higher power-efficiency over CMOS.

Still, the handwriting is on the wall for GaAs. “For the PA, SiGe BiCMOS has strong market share in WiFi, while GaAs HBT has strong market share in cellular. RF CMOS is relegated to the very low-end 2G/2.5G cellular space,” TowerJazz’ Racanelli said. “SOI for the PA is only in R&D and may not deliver the best performance by itself. But combined with switches and other functions, (SOI-based PAs) could become relevant as new architectures are adopted. Our view is that SiGe has the best tradeoff in performance. The cost structure is closer to CMOS/SOI. SiGe is likely to gain more ground in the future.”

Also in the RF front-end, there is a tunable capacitor, which tunes the antennae to boost efficiencies. Peregrine is selling SOS-based tunable devices. Paratek and STMicroelectronics are selling components based on barium strontium titanate (BST). And WiSpry is offering a MEMS solution.

“There are two vectors worth exploring here,” GlobalFoundries’ Noonen said. “If you can do something in CMOS, it will be done in CMOS. We will see other ways to approach the problem. Using a tunable capacitor based on MEMs, for instance, you can attack the problem from an entirely different angle.”

Indeed, in the RF front-end, there is no one-size-fits-all technology; OEMs likely will adopt several types of chips and processes. “We will also see more functionality in the RF subsystem,” Noonen said. “The idea is to bring RF into more of a mainstream technology.”

By Jeff Chappell
There may have been a time when AMD founder Jerry Sanders famous quote: “real men (i.e., real companies) have their own fabs” rang true, but in today’s business climate it seems quaint at best.

Fabless or fab-lite business models are more popular than ever today, while some IDMs have turned back the clock, so to speak, looking to improve capacity utilization and revenues by offering foundry services—Intel and Samsung among them. Then there is the fact that the third-largest chipmaker in 2012, in terms of revenue, was a pure-play foundry.

As the 28nm node capacity ramp continues in the foundry market in 2013, following unexpected demand and capacity bottlenecks in 2012, today’s foundry market is the end result of market trends and forces with old roots. But those trends and forces have been compounded in modern times by extreme financial and market necessities, not to mention technology.

In one sense, however, at its core, the foundry market hasn’t changed since Taiwan Semiconductor Manufacturing Co. (TSMC) launched as the industry’s first pure-play foundry in 1987: Chip companies look to foundries, either as a customer or as a provider, to maximize productivity and thereby minimize costs. That part of the game hasn’t changed, whether it involves a component supplier designing power modules with 0.18-micron design rules for manufacturing on 200mm wafers, or one of the two GPU giants producing their next-generation graphics processors based on the latest technology.

The trend for years now has been fabless or fab-lite; even Sanders’ own AMD spun out its manufacturing arm several years ago to create one of the world’s largest pure-play foundries, GlobalFoundries. This has naturally in turn spawned the growth of the pure-play foundry market from its birth some 26 years ago.

Indeed, last year the overall foundry market enjoyed revenues of $29.6 billion, managing year-over-year growth of 12%, which is three times that of the chip industry over all in 2012. That growth caught everyone by surprise including the foundries themselves; 28nm capacity was tight for much of the year, even as yields improved dramatically—so much so that it reportedly impacted some capital equipment purchases, in spite of tight foundry capacity.

But that illustrates the biggest and most obvious change in the foundry industry in modern times: The foundries themselves are involved directly with developing leading-edge semiconductor technology. In fact, with the industry looking at the end of planar CMOS at the leading edge for some devices with the advent of 3D transistor architectures and the high-k materials they require, leading foundries no longer can rely on a mix of conventional scaling, publicly available data and equipment and process technology suppliers to get their jobs done. Research and development now must be within their purview, at least for those playing at the leading edge.

“Historically foundries don’t do R&D, their clients do it,” noted Dean Freeman, a research vice president at Gartner Research. That’s not so, today.

Nothing illustrates that fact better than TSMC’s R&D budget. In 2012 the company spent 33.8 billion NT, or about $1.13 billion, on R&D—a quarter of its revenue. This year the company plans to spend 40.4 billion NT, or about $1.35 billion, which includes adding some 500 people to its employee headcount, bolstering its R&D staff from 3,400 people to 3,900.

Indeed, leading foundries have joined the leading IDMs and technology consortia as purveyors of—not just manufacturers of—advanced technology.

While TSMC and its foundry brethren in the first tier of the pure-play market—Globalfoundries and United Microelectronics Corp. (UMC)—continue to build out 28nm capacity, they are also hard at work on the 20nm node and the subsequent hybrid 14/16nm finFET based on a 20nm back-end of line process. In fact, TSMC just announced first tapeouts of an ARM A-57 processor, based on the 64-bit ARMv8 processor series and built with 16nm transistor technology, including finFETs. This followed their rival’s announcement of a few months earlier. In February, GlobalFoundries announced a “first implementation” of a dual-core ARM A9 processor using the company’s 14nm-XM FinFET transistor architecture.

Follow the money
Being on the very leading edge of technology is driving growth among the first-tier foundries.

Like many others in the industry, TSMC and its chairman and CEO, Morris Chang, are quite bullish on the continued demand for 28nm technology as well as the development of 20nm technology. In general, 28nm designs, with their combination of lower power consumption and speedier transistors, have consequently proven cost-effective for a chip industry currently driven by mobile devices—smartphones, tablets and ultra lightweight notebooks. During TSMC’s review of its 2012 results earlier this year, Chang said the company will continue to aggressively grow its 28nm capacity and output; 2013 capacity and output will triple that of 2012, he said.

“It’s all about lower power with functionality and no sacrifice on the power requirements,” observed Kathryn Ta, managing director of strategic marketing for Applied Materials’ Silicon Systems Group. The equipment and process technology supplier’s foundry customers are seeing a need to move to 3D transistor architectures with minimal leakage, she said, because of those power requirements.

Development will continue at 20nm and 16nm as well at TSMC and its rivals. This year, 88% of the 9 billion NT that TSMC will spend on capital expenditures will go to 28nm, 20nm and 16nm capacity; an additional 5% will be spent on additional R&D equipment. Chang predicted that by Q3 of this year high-k metal gate production will surpass that of standard oxynitride gates, a gap that naturally will widen in Q4 and beyond.

“Enough discussions have taken place with enough customers … to lead us to believe that in both its first and second year of production (2014 and 2015, respectively) the volume of 20nm SoCs will be larger than that of 28nm in its first and second years of production (2012 and 2013),” Chang said.

He further noted that this represented the state of the art, and not just for the foundry industry, but for the industry as whole. This may indeed prove to be true in a few years as those 20nm and 16nm/14nm SoC devices move into production. It’s a far cry from the days when foundries were traditionally technological also-rans.

But then the first-tier foundries at the leading edge are still playing catch-up in the meantime with those IDMs at the leading edge, namely Intel. The world’s biggest chipmaker has kept Moore’s Law on track on the CPU side of the ITRS roadmap, last year having brought its Ivy Bridge processors to market. These feature 22nm transistors replete with finFETs; Intel’s own roadmap calls for 14nm designs to be in production in 2014; in terms of mobile SoCs like those the foundries are talking about, the company has promised its 22nm Atom SoCs will be in production in 2015.

“Intel seems to be able to continue to shrink because they spend a fortune on R&D,” said Gartner’s Freeman. “The foundries are pushing hard to catch up,” He noted that while both GlobalFoundries and TSMC have 16nm/14nm chips featuring finFETs in development, they are taking a shortcut, so to speak, by employing 20nm metal interconnects. “It’s close to what Intel is doing. Intel’s design may be more sophisticated, but the lithography is the same.”

Plenty of room, and business, at the trailing end
But not everybody in the foundry market is playing at the leading edge. The same market and industry forces that have induced the bigger pure-play foundries to move beyond their historical roles also have created a two-tiered pure-play foundry market. In the first tier are those that have the deep pockets to play in this space: TSMC, Globalfoundries, UMC, and to a lesser extent China’s Semiconductor Manufacturing International Corp. (SMIC).

Then there are the second-tier companies, those that are still fulfilling a traditional foundry role—at trailing edge processes, but nevertheless needed or even essential semiconductor manufacturing technology and capacity. Indeed, many second-tier foundries do quite well with their particular market niches and technologies. In the world of mobile consumer gadgets, including but not limited to smartphones and tablets, there are still many components fabricated on established, trailing-edge technology, such as sensors, microcontrollers and power components.

Even in 2013, where CPUs with 22nm transistors and mobile SoCs with 28nm transistors represent the current state of the art, some 40% of all silicon used to manufacture chips goes into mature devices fabricated on 200mm wafers. That’s typically 0.18-micron designs or larger. And much, if not most, of that is coming from pure-play foundries.

At the top of that second-tier foundry market, Israel’s TowerJazz, for example, has found a relatively comfortable niche making high-speed devices for a broad range consumer applications utilizing 0.13-micron designs and larger. It also makes CMOS image sensors with 0.16- and 0.11-micron design rules. In terms of financials, this has translated to record revenues: last year TowerJazz posted revenues of $638.8 million, an increase of 5% over the previous year.

Freeman suggested there are plenty of opportunities for these second-tier foundries. The so-called “Internet of Things,” for example, is a major driver behind sensor applications, as it is for the controllers needed to coordinate the data these sensors produce—data that can be managed via mobile Internet devices. These supplemental and complementary applications typically don’t need cutting-edge technology.

As has always been the case in the foundry industry, as leading-edge technology becomes trailing-edge, there will be new opportunities for second-tier foundries, as well. Some of the larger second-tier foundries eventually may have the opportunity to compete with first-tier companies head-to-head with 28nm capacity if they have deep-enough pockets to invest.

In the bifurcated smartphone market, for example, low-end smartphones that originally utilized chips manufactured with 40nm technology soon will migrate to chips with 28nm technology, as capacity ramps and it becomes even more cost effective, said Applied’s Ta. Even as the leading-edge players are driven beyond the 28nm node and the adoption of 3D gate architectures, the industry could very well see an extended 28nm node, driven by this market for lower-end smartphones and other mobile devices, she said.

But What About …
Things rarely ever prove to be so clearly defined in the chip industry. With players such as Samsung, Intel and IBM among others flirting with the foundry business, and some of the larger first-tier foundries suffering the same financial headaches that have plagued the IDMs in the past—problems that drove some of them to a fabless model in the fist place—there are some significant unknowns.

While 3D, high-k metal gate architectures, i.e, finFETs and the like, seem to be the wave of the near future, there are still those in the industry that tout the efficacy of fully depleted silicon-on-insulator (FD-SOI) as either an alternative to complement to 3D gate technology, for example.

IBM and its technology alliance partners have considered FD-SOI as a possible outcome of the semiconductor technology roadmap in the near future, Ta noted. “We see most of the effort on the finFET/Intel approach, but some of our customers are still talking about SOI,” perhaps used in some combination with finFETs, she added.

Gartner’s Freeman noted that Intel’s finFET devices are already fully depleted devices, although SOI could conceivably provide a bit less leakage; as such it may be an option at future nodes. Given the transistor speed and power usage achieved by its 22nm Atom processors, which are manufactured on top of bulk silicon technology, that seems unlikely though for Intel and those choosing to follow its lead. Freeman further observed that GlobalFoundries, once a proponent of FD-SOI, has backed off somewhat, although some of its largest customers remain committed to an FD-SOI strategy for the foreseeable future. IBM, for one, has publicly stated it will use FD-SOI, finFETs and stacked die together at future nodes.

But what does this mean for the leading-edge foundries? As always they will have to be able to manufacture what their customers want. It may be that some chipmakers will choose to go the FD-SOI route and that could prove a competitive opportunity for any foundry.

Another wild card that the top-tier foundries will need to take into account is the overlapping of technology nodes, which may become more pronounced with the extension of the 28nm node coupled with the rush to get 20nm devices into production. “It’s happening faster than previous node transitions have happened,” Applied’s Ta, noting that it’s driven by the low-power promise of finFETs. In the past node transitions typically took two to 2.5 years; “This time we may see a 1.5 year transition to finFETs,” she added.

Another question mark in the foundry market itself is SMIC. While most would still classify the Chinese foundry as a top-tier foundry, it is in a very real way straddling the gap between first and second tier. The company, once relatively close behind TSMC and UMC, has foundered in red ink and legal woes in recent years. While it has subsequently experienced an impressive turnaround financially under the helm of current CEO Tzu-Yin Chiu in 2012, it’s capital expenditures fell dramatically, even as capacity utilization hit 95% in Q2, and it is well behind its rivals in terms of technology.

Customer tapeouts of 28nm devices won’t take place until the end of this year; One of SMIC’s largest domestic customers, Spreadtrum, already has been forced to move to rival TSMC to meet its current plans for 28nm devices.

SMIC’s Chiu has said that the company’s 28nm technology will include both standard polysilicon oxynitride devices and high-k metal gates, and that it has plans to manufacture finFET devices at the 20nm node. In the meantime, it has found a saving grace in applications typically manufactured by second-tier players: smart cards, CMOS image sensors and power management chips.

Which way will SMIC go? Will it continue its impressive turn around by abandoning the leading edge or will it continue to play technological catch up? Or perhaps a little bit of both?

Time will tell. But it’s certainly an interesting time for the foundry business, and certain that for the foreseeable future the pure-play foundries will have to work hard at the cutting edge of semiconductor technology.

By Mark LaPedus
Sara Volz, 17, of Colorado Springs, Colo., won $100,000—the top award—from the Intel Foundation for her research on algae biofuels. Algae produces oil that can be converted into a sustainable, renewable fuel. Volz, who built a home lab under her loft bed, sleeps on the same light cycle as her algae.

For years, the investment community has demanded that ASM International (ASMI) should break up the company into two pieces. This week, ASMI finally caved in, leaving some to wonder if the company is the next takeover target in the semiconductor equipment business. ASMI intends to sell a stake in ASM Pacific Technology, valued at between 8% to 12%. Following the planned divestment, ASMI will own between 40% and 44% of the shares in ASM Pacific, a supplier of wirebonders.

A TEM image taken at Applied Materials’ Maydan Technology Center shows a series of 20nm-wide trenches in a cross section. What does this all mean? According to Applied, it’s a breakthrough in reflow to push interconnect boundaries beyond 20nm.

Applied Materials was named by the Ethisphere Institute, a business ethics think-tank, as one of the 2013 world’s most ethical companies.

MEMC, a supplier of silicon and SOI wafers, announced a plan, subject to shareholder approval, to change its name to SunEdison. The name change reflects its recent efforts in the solar industry. MEMC competes in both the semiconductor and solar industries. Does the name change reflect that semis are passé or does MEMC have an identity crisis?

Specialty foundry TowerJazz is seeing significant customer engagements and market share gain in the fast growing RF front-end module market. For Skyworks and others, TowerJazz is providing RF SOI, RF CMOS and SiGe processes.

ALTIS Semiconductor announced the finalization of a foundry agreement with IBM Microelectronics. Under the terms, ALTIS will be the foundry partner for the IBM 180nm RF SOI technology.

SEMI reported that worldwide sales of semiconductor manufacturing equipment totaled $36.93 billion in 2012, representing a year-over-year decrease of 15%.

Cadence has agreed to buy Tensilica, setting the battle over IP into high gear among EDA vendors.

Mentor Graphics announced the Nucleus SmartFit product, a cost-effective, binary version of the Nucleus RTOS optimized to fit the limited internal memory of 32-bit MCUs.

ST-Ericsson, a joint venture of STMicroelectronics and Ericsson, announced that Didier Lamouche, president and chief executive, has decided to resign from the company to pursue other opportunities. And following those events, Ericsson and STMicroelectronics this week announced an agreement on the fate of ST-Ericsson. Ericsson will take on the design, development and sales of the LTE multimode thin modem products, including 2G, 3G and 4G multimode. ST will take on the existing ST-Ericsson products, other than LTE multimode thin modems, and related business as well as certain assembly and test facilities. The companies will close down the remaining parts of ST-Ericsson.

China’s Advanced Micro-Fabrication Equipment (AMEC) will make its solid-state lighting market debut with a new multi-reactor metal organic chemical vapor deposition (MOCVD) cluster tool. The Prismo D-Blue MOCVD platform enables high-volume manufacturing of GaN, InGaN and AlGaN structures required for high-brightness LEDs.

Nanoplas announced a new dry-etch process that offers unlimited etch selectivity for removing dielectric films. Nanoplas’s new Atomic-Layer Downstream Etching (ALDE) processing allows etching rate and selectivity to be controlled independently.

According to IHS, the steady increase in PC capabilities that has justified the upgrade cycle and fueled the long-term growth of the PC market is undergoing a historical deceleration.

Household adoption and spending on consumer technology products is shifting faster than expected in favor of gadgets and services that are portable or mobile, according to a recent survey by Gartner.

By Mark LaPedus

The recent Nano Job Fair in New York exceeded the 800 registrant capacity. Due to the overwhelming response, and the need to fill an additional 300 jobs, another job fair will be scheduled in the next few months. The fair itself filled more than 300 current and future openings at the CNSE, including positions with the Global 450mm Wafer Consortium (G450C).

China’s transition from a low-cost manufacturing hub to an innovation hotspot with growing foreign ambitions represents both a threat and an opportunity, according to Lux Research. Foreign acquisitions worth $28 billion are just the beginning of China’s global ambitions, according to the firm.

The Chinese IC market is forecast to have a 2012 to 2017 compound annual growth rate (CAGR) of 13%, five points higher than the 8% CAGR forecast for the total IC market during this same time period, according to IC Insights. By 2017, China is expected to represent 38% of the worldwide IC market, up from 23% in 2007, according to the firm.

Skyworks announced its results for the quarter. The company has also garnered some RF antenna tuning design wins, some of which are based on silicon-on-insulator (SOI) technology, said David Aldrich, president and CEO of the RF chip maker, on the Seeking Alpha Web site.

STMicroelectronics announced its results for the quarter. During a conference call, Carlo Bozotti, president and CEO of ST, said the company is developing ASICs for various applications using FD-SOI technology. ST also is looking at strategic options for ST-Ericsson, the cell-phone chip venture with Ericsson, he said. The venture recently rolled out a chip based on FD-SOI.

Following the announcement of STMicroelectronics’ intention to exit as a shareholder of ST-Ericsson, Ericsson is also exploring various strategic options for the venture.

Kilopass, a provider of semiconductor intellectual property (IP), will demonstrate its one-time programmable (OTP) memory IP on IBM’s 45nm, silicon-on-insulator (SOI) technology at the Common Platform Technology Forum. The event, which is on Feb. 5, will take place in Santa Clara, Calif.

Mentor Graphics announced the latest release of its HyperLynx product for superior high-speed design and analysis.

Chipmakers must explore, and embrace, new design methodologies to cut costs and boost cycle times. One way to bolster the design flow is to rethink the register-transfer level (RTL) synthesis process.

Applied Materials said that George Davis, executive vice president and chief financial officer, will depart the company effective March 8. The company expects to name a successor in the coming weeks. Davis will become CFO for Qualcomm.

SEMI and the U.S. Photovoltaic Manufacturing Consortium (PVMC) announced the signing of a memorandum of understanding (MOU) to enhance their cooperation in the areas of standards and roadmap activities for the solar thin film industry.

Renesas continues to cut costs. The company has sold its backend operations to J-Devices.

American Semiconductor has a process that transforms standard silicon wafers into flexible wafers. The technology is now available on TowerJazz’ CMOS foundry process.

Worldwide tablet shipments outpaced predictions, reaching a record total of 52.5 million units worldwide in the fourth quarter of 2012, according to IDC. Samsung is gaining ground on Apple, according to the firm.

VLSI Research says the IC industry will grow 10.1% in 2013. “We expect (the IC industry) to be an ASP-driven upturn,” according to the firm. “Even though the Chinese New Year is still weeks away, chipmakers are becoming more optimistic about 2013. This is driven in part by a modest improvement that is taking place at the macro level. The visibility for the U.S. economy has improved considerably. China’s macro data has also been positive and the European debt crisis appears to be fading.”

Chip inventory held by semiconductor suppliers reached alarmingly high levels in the third quarter of 2012 amid weak market conditions, according to IHS iSuppli.

IC Insights believes that the more profitable foundries will be those that keep at the leading-edge of the process technology roadmap.

In 2012, for example, the ≤45nm process foundry segment is expected to represent 30% of the total pure-play IC foundry revenue, up from 22% in 2011, according to the research firm.

With that in mind, GlobalFoundries is expected to have a greater percentage of its sales dedicated to ≤45nm technology than TSMC this year, according to IC Insights. But TSMC is forecast to have more than twice the sales volume at ≤45nm, as compared to GlobalFoundries in 2012, according to the firm, which estimated $6.23 billion for TSMC and $2.79 billion for GlobalFoundries.

Moreover, TSMC is forecast to have about $1.8 billion in sales of 28nm devices alone this year, up almost 10x from the $185 million worth of 28nm product the company sold in 2011, according to the firm.

In 2012, about 37% of TSMC’s revenue is expected to come from ≤45nm processing, compared to 65% for GlobalFoundries. For years, GlobalFoundries’ fabs have been producing AMD’s MPUs. So its processing technology is skewed toward leading-edge feature sizes.

Only 11% of UMC’s sales are forecast to be dedicated to ≤45nm technology this year, according to the firm.  Less than 1% of SMIC’s 2012 sales are expected to come from devices having ≤45nm feature sizes.

Older technologies, namely the >0.18-micron segments,  are forecast to account for only 13% of the pure-play foundry market in 2012, down one point from 2011 and two points from 2010, the firm said. Of the 14 pure-play foundries ranked 5th-18th, only four (TowerJazz, Grace/HHNEC, Dongbu, and Xinxin) are expected to be able to produce ICs using ≤90nm feature sizes in 2012, and this production is likely to be relatively limited.

Collectively, these 14 “non-major” IC foundries are forecast to account for $4.6 billion in sales, or about 15% of the total pure-play IC foundry market in 2012, it added.

By Mark LaPedus

Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) is expected to remain the world’s leading foundry in terms of sales in 2012, according to the new and projected rankings from IC Insights.

But GlobalFoundries is expected to jump from third in 2011 to second place in the rankings in 2012, surpassing Taiwan’s United Microelectronics Corp. (UMC), according to the firm.

For the second year in a row, Samsung is expected to be ranked as the fourth largest IC foundry.  IC Insights believes that the company will challenge UMC for the number three spot in the rankings in 2013.

Samsung makes application processors on a foundry basis for Apple. It is estimated that Samung’s capacity dedicated to its IC foundry business reached 130,000 300mm wafers per month in mid-2012.  Using an average revenue per wafer figure of $2,500, Samsung currently has the potential to produce annual IC foundry sales of about $3.9 billion, according to the firm.

Samsung’s IC foundry sales are forecast to jump by 54% in 2012, which would make it the fastest growing top-12 IC foundry this year.  Moreover, Apple’s 2012 share of Samsung’s total foundry sales is expected to be 85%.

In the rankings, SMIC is projected to be in fifth place in 2012, followed by TowerJazz, Grace/HHNEC, Vanguard, Dongbu, IBM, Win and Magnachip.

In total, the top 12 foundries are expected to represent 89% of the total foundry sales (IDM and pure-play) in 2012.  This share is eight points higher than the 81% figure the top 12 represented in 2009, according to the firm.

By Mark LaPedus
Applied Materials introduced its Centura Avatar high aspect ratio etch system, capable of handling the carbon-based mask materials used to define the vertical openings in 3D NAND.

Soitec said that its Altatech subsidiary has installed a CVD system in CEA-Leti. The research organization will use it to develop phase-change memory devices and high-k metal gates for the sub-20nm node.

United Microelectronics Corp. has licensed IBM’s technology to expedite the development of the foundry’s next generation 20nm CMOS process with FinFET  transistors. This agreement between UMC and IBM is only inclusive of IBM’s 20nm CMOS and FinFET. UMC’s internally developed 20nm planar process will be aligned to IBM’s design rules and process/device targets, while UMC’s FinFET will be offered as a low-power technology enhancement option for mobile computing and communication products.

Intel announced its seventh Intel Science Technology Center (ISTC). Part of a $100 million effort to propel new R&D centers, ISTC will focus on social computing. In one of its vast array of research projects, Intel and others provided details about the development of a smart automotive headlight for seeing through rain and snow.

As expected, Micron Technology and Elpida Memory announced that the parties have signed a definitive sponsor agreement for Micron to acquire and support Elpida. The deal is worth 200 billion Yen ($2.5 billion).  In a related transaction, Micron also announced a separate agreement with Powerchip, a Taiwanese corporation, and certain of its affiliates to acquire the Powerchip group’s 24 percent share of Rexchip. That deal is worth approximately $334 million.

VLSI Research released its upbeat outlook for 2013. The semiconductor equipment market is expected to reach $56 billion in 2013, up 10.1% from 2012. VLSI Research also raised its fab tool forecast in 2012, from minus 7.2% to minus 4%.

In addition, VLSI Research said the worldwide IC market is projected to hit $283.4 billion in 2013, up 9.7% from 2012. VLSI Research also lowered its IC outlook in 2012, from 4% growth down to 2.3%. “Chipmakers are becoming more tenuous about the second half, resulting in limited visibility for equipment suppliers,” according to the research firm. “However, the skittishness has little to do with the chip market, where the overall fundamentals remain relatively healthy; it’s driven by a deteriorating macroeconomic picture. Fears are that the chip industry could be running on borrowed time given the high correlation between it and the macro economy.”

Pricing in the DRAM market has become less volatile since the February bankruptcy of Elpida Memory according to IHS iSuppli.

If ASML can get EUV to work in production, the company could hit the jackpot. An EUV tool is expected to run $125 million each. C.J. Muse, an analyst with Barclays, said: “We believe the true EUV tool demand ramp will occur in the 2014/2015 timeframe. This should coincide with DRAM transitioning to 20nm and foundry to 14nm. Based on the layer requirements, we see foundry and DRAM as the major drivers of EUV tool demand in 2015. In our base case for 2015, we are assuming (about) 18 EUV tools will go to foundries, (about) 8 to DRAM, (about) 4 to Intel, and none to NAND (though ramping in 2016), for total 2015 shipments of 30-36 EUV tools.”

Maxim announced a $200 million investment to upgrade its U.S. wafer fabs in Beaverton, Ore.; Dallas and San Antonio, Texas; and San Jose, Calif. The investment will be used for 200mm upgrades. The analog chip maker maintains a 300mm foundry deal with Powerchip.

MagnaChip now offers a new 0.18-micron bipolar-CMOS-DMOS (BCD) process. This new process features operability at 60 volts and will support additional voltage ranges (12 to 60 volts) for applications that include DC-DC converters, power-over-Ethernet, LED drivers, audio amps and power management ICs for the mobile and consumer markets.

TowerJazz said its 0.18-micron BCD process has been qualified to meet the certification requirements of the AECQ100 standard as defined by the Automotive Electronics Council (AEC).

Gaas Labs, a private investment fund, acquired Nitronex, a supplier of gallium nitride (GaN) RF chips.

Ultratech has acquired the rights to a collection of patents from IBM. These include fundamental patents in packaging such as C4 bumping, BGA, lead-free solders and 3D packaging.

By Mark LaPedus
The ongoing push towards green and energy-efficient systems is prompting the silicon foundries to jump on the bandwagon and devise their next-generation processes based on ultra-high voltage technology.

For some time, several foundries have offered 1- and 0.5-micron, ultra-high voltage processes with ratings up to 800 volts. But seeking to get a jump for the next wave of designs, the specialty foundries have taken a narrow lead in the process race over the larger players like GlobalFoundries, TSMC and UMC.

South Korea’s Dongbu HiTek and Germany’s X-Fab Silicon Foundries AG recently rolled out 0.35-micron processes with ratings at 700 volts as a means to reduce cost and power. X-Fab, for one, has moved from a 1-micron silicon-on-insulator (SOI) process to a 0.35-micron bulk technology, although the company is developing a 0.18-micron SOI scheme for 200 volt applications.

The other foundries also are working on ultra-high voltage processes at 0.35-micron and below. Ultra-high voltage processes fall into the broad category of power management and generally involve technologies from 600 volts and above. In the 600 to 800 volt segment, there is also an emerging collision course for various transistor types.

The main applications for 600 to 800 volts include AC-to-DC switching power supplies, LED lighting systems and power converters. For these systems, the market is migrating towards 0.35-micron geometries on 200mm wafers, said Thomas Hartung, vice president of marketing for X-Fab. “For analog and mixed-signal companies, we see 0.35-micron as the sweet spot,” Hartung said.

The shift towards 0.35-micron processes is expected to lower the manufacturing and product costs for systems. But the real problem has been evident for some time: How does the industry reduce or tame standby power?

In the home, for example, power supplies take AC power from a wall outlet and convert it into DC. Conventional power supplies based on older linear technology are cheap but inefficient. Appliances plugged into the wall still consume energy, or standby power, even when the product is not in use. Linear-based cell-phone chargers, for example, can consume between 0.8 to 2 Watts even when they are not connected to the phone, according to chipmaker Power Integrations Inc.

Some 5% to 15% of household electricity consumption worldwide is wasted in standby mode, according to the International Energy Agency. In the U.S. alone, standby power costs households over $5 billion in electricity a year, according to Lawrence Berkeley National Lab.

One solution to the problem is the advent of switch-mode power supplies, which are generally more efficient and expensive. For switching power supplies, the goal is to reduce costs through IC integration and finer geometries. The concept is similar for fly-back converters in LED lighting systems.

In these segments, power management chips are specified to withstand breakdown voltages at 600 volts in the event of a power surge or spike. Some vendors sell integrated power management devices at 725 volts. “You want your transistors (with ratings of at least) 600 volts to operate in the 220 AC range,” said Steve Ohr, an analyst with Gartner Inc. “You want to have tolerances at 600 volts to prevent the system from failing.”

The prevalent switching technology in these types of systems is the power MOSFET. But there are big changes within the 600 volt segment, as several transistor types are emerging in the arena. “At 600 volts, you will see a clash of the titans between a range of technologies,” Ohr said. “You will see IGBTs, bipolar, power MOSFETs, gallium-nitride (GaN) FETs, and silicon-carbide transistors.”

Foundries push ultra-high voltage
On the foundry front, there are more subtle changes taking place in the arena. In digital, most integrated device manufacturers (IDMs) have outsourced a growing percentage of their production to the foundries. In contrast, the power management IDMs tend to keep their production in-house and the foundry business is relatively smaller for high-voltage devices right now, said Robert Lineback, an analyst with IC Insights.

Still, the foundries are seeing gradual growth from an emerging crop of fabless vendors in the higher voltage segments. “For TowerJazz, 700 volts makes up approximately 20% of new power designs,” said Todd Mahlen, vice president of APAC sales and power business development for specialty foundry TowerJazz Inc. “It is a limited set of customers, compared to lower voltages. In the short term, margin numbers are better for 700 volt technology.”

The foundries do not offer a 700 volt process alone. Instead, they tend to provide a complete modular, multi-volt process, which includes low- (3.3-, 5 and 6.5 volt), medium- (20 and 30 volt) and high- and ultra-high voltage (450 and 700 volt) technologies. “6.5-, 5- and 3.3-volt are used in logic and small signal analog functions. 20 and 30 volts are ideal for gate driver voltages for high-voltage MOSFETs,” Mahlen said.

Andy Brown, vice president of foundry sales for South Korea’s MagnaChip Semiconductor, added: “People may also want 500 volts, because that is the voltage that can directly interface with an AC line. 700 volts is designed for fly-back architectures” and other systems.

Meanwhile, getting a jump on the market, Dongbu HiTek late last year claimed to offer the foundry industry’s first 700 volt process at 0.35-micron. The initial process comes without an epitaxial layer. It supports a range of voltages and maintains low on-resistance (RDSon) by using a reduced surface field technique.

Then, in May, X-Fab rolled out XU035, an 200mm, 0.35-micron process for ultra-high-voltage applications. Using bulk wafers, the process supports 20 , 40 and 700 volts with low RDSon. The total mask count ranges from 13 to 18 steps. The 0.35-micron process is ideal for integrated power-management devices, where cost and functionality are key. “The integrated solutions are becoming more and more popular,” X-Fab’s Hartung said.

Previously, X-Fab offered a 1-micron process for 650 volt applications. “That was an SOI and trench isolation architecture,” Hartung said. “But for high-volume 700 volt applications, we need bulk and 0.35-micron. It’s a cost-effective solution.”

X-Fab is developing a new 0.18-micron high-voltage process based on SOI. The applications for this process are 200 volts, which is ideal for power-over-Ethernet and ultrasound units, he said.

SOI also is getting traction in other analog and mixed-signal markets. STMicroelectronics, for example, recently rolled out a 0.16-micron, SOI-based version of its BCD process for use in medical equipment and hybrid vehicles. The process combines 1.8- and 3.3-volt logic CMOS circuits with power MOSFET transistors that can operate up to 300 volts.

“For RF, SOI is also cost-effective,” said Horacio Mendez, executive director of the SOI Industry Consortium, a group that is looking to accelerate the use of SOI in the market. In RF switch applications, SOI reduces noise and cross-talk while maintaining signal power, he said.

By Mark LaPedus
The French National Research Agency and the CEA signed an agreement forming the Grenoble Institute of Technological Research (IRT): NanoElec Program. The R&D activities will focus on 3D IC integration and integrated silicon-photonics, in which STMicroelectronics and Mentor Graphics are involved.

Mentor Graphics also struck five separate deals in three product areas. In one deal, Mentor announced the availability of a new DFM Analysis Service based on the Calibre platform for TSMC’s 40nm and 28nm foundry customers. Then, three foundries—GlobalFoundries, SMIC and TowerJazz—separately said they are using Mentor’s Calibre PERC tools for electrostatic discharge applications. And finally, AT&S (Austria Technologie & Systemtechnik), a manufacturer of printed circuit boards, is using Mentor’s PCB design-through-manufacturing flow.

United Microelectronics Corp. (UMC) broke ground on its new 300mm Fab 12A Phase 5 and 6 complex in Tainan, Taiwan. The fab is geared for 28nm and 20nm production.

Intel will invest more than $40 million over the next five years in a worldwide network of university research communities called the Intel Collaborative Research Institutes (ICRI). Researchers will explore body-area-networking, secure computing and other technologies.

Element Six, a supplier of synthetic diamonds, announced the opening of its first U.S. manufacturing facility in Silicon Valley. Synthetic diamonds provide thermal conductivity and electric insulator properties in semiconductor and other applications.

Advanced Micro Devices (AMD) this week rolled out its R-Series accelerated processing unit (APU) chips for the embedded market. The devices are based on the same architecture as its recently announced A-Series APUs for PCs. Like the A-Series, the R-Series APUs are based on a 32nm process as well as silicon-on-insulator (SOI) technology from Soitec. Both the A-Series and R-Series are manufactured by GlobalFoundries.

Two new smartphone lines from Samsung—the Galaxy Beam and Ace 2—are using ST-Ericsson’s integrated baseband/application processor solution, dubbed NovaThor ModAp. ST-Ericsson is also developing a new 28nm solution based on FD-SOI from Soitec.

By Mark LaPedus

IBM Corp., Samsung Electronics Co. Ltd., TowerJazz Inc. and an unlikely company, Powerchip Semiconductor Corp., gained ground in the foundry rankings in 2011, according to a new report from Gartner Inc.

Dongbu HiTek lost ground, according to the rankings. The worldwide semiconductor foundry market totaled $29.8 billion in 2011, a 5.1 percent increase from 2010, according to Gartner.

In the rankings, there were no changes among the top four suppliers from 2010 to 2011. In terms of sales in 2011, the top four vendors in order were Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC), United Microelectronics Corp. (UMC), GlobalFoundries Inc. and Semiconductor Manufacturing International Corp. (SMIC).

However, two vendors – UMC and SMIC – lost share. Another vendor, TowerJazz, moved up one spot into fifth place, according to Gartner. IBM jumped from eighth to sixth place, while Vanguard International Semiconductor Corp. (VISC) remained in seventh.

Dongbu fell from fifth to eighth place, but Samsung went from 10th to ninth. Gartner did not include Samsung’s business with Apple, of which it considers ASICs. Samsung’s foundry, with $470 million in revenue, ranked No. 9.

“However, Samsung Electronics had been very aggressively expanding its LSI business in 2011. Had the estimated $1 billion Apple wafer business been included in its foundry revenue, Samsung would rank as high as No. 4 in the foundry ranking,” according to Gartner. According to IC Insights Inc., however, Samsung jumped one place to 4th in the foundry rankings in 2011.

Powerchip was 10th in Gartner’s rankings. “Powerchip had a nearly threefold increase in foundry revenue in one year due to the strategic decision to shift from the commodity DRAM business to foundry in early 2011,” according to the firm. Powerchip makes DRAM for Elpida and analog chips for Maxim.

“Thanks to stable media tablet and mobile phone sales, a slide of the semiconductor and foundry revenue in 2011 was prevented,” said Samuel Tuan Wang, research director at Gartner. “After 40.5 percent growth from 2009 to 2010, the foundry market maintained relatively flat business in 2011 due to the weakness in PC production and an overall consumer demand hit, as well as a leaner inventory practice by customers that started in mid-2011.”