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March 2010

iPad: The iPhone on Steroids?

The Apple iPad will be shipping April 3, 2010. If you have already pre-ordered, you will get it at that time. If you still need to order the iPad, you will be waiting until after April 12. According to recent news items, the pre-order levels may have exceeded Apple’s initial expectations.

Apple experienced a huge surge in orders the first day pre-orders were available. Pre-orders have fallen to a slow but steady pace ever since. After two weeks of orders it appears that approximately 240K pre-orders are on the books. Now the question is not so much whether Apple can deliver the product on time, but can it deliver on the hype?

There are high expectations for the iPad, but is the hype just Apple’s loyal following? What will Apple offer to make the iPad attractive to the mass market? How will the iPad compete with e-readers and netbooks? What is the market potential for tablet PCs? What are some of the issues for the semiconductor industry and what are the business opportunities for chip vendors?

Semico Research has prepared a market brief, “Apple iPad: A New Computing Paradigm or the iPhone on Steroids?” Semico examines various questions and issues around the iPad and tablet PCs in general. The market segment of tablet PCs has yet to truly emerge. This market brief will address some of the competitive factors that are likely to influence its development.

iPad: The iPhone on Steroids?

Phoenix, Arizona March 30, 2010 - The Apple iPad will be shipping April 3, 2010. If you have already pre-ordered, you will get it at that time. If you still need to order the iPad, you will be waiting until after April 12. According to recent news items, the pre-order levels may have exceeded Apple’s initial expectations.

IP Availability for SOI Designs to Boost SOI Production

On March 23rd, 2010, the Silicon-On-Insulator Consortium (SOIC) announced a new program geared towards creating an ecosystem for Semiconductor Intellectual Property (SIP) around SOI wafers. The initial members of the IP ecosystem are IBM, ARM, Ltd., and Cadence Design Systems, Inc. additional members include Synopsys, Inc. and Boeing, Corp. The idea behind this announcement is to establish an IP ecosystem to provide the building blocks essential to crafting System-on-a-Chip (SoC) designs and to establish a list of EDA vendors that have tool sets to facilitate these designs on SOI wafers. Currently, the IP is only for IBM’s 45nm SOI foundry process, but will broaden out to include 65nm and 28nm process geometries and presumably other foundries’ processes as well.

The addition of other process geometries and other foundries’ processes will further increase interest in doing designs on SOI wafers. The entire process of having major players in the semiconductor, IP and EDA markets come together to collaborate on developing this ecosystem validates the proposition that SOI can bring greater long term benefits than by just continuing to use bulk CMOS

DRAM Reversal of Fortune, Now What?

Phoenix, Arizona March 25, 2010 - Semico forecasts 2010 DRAM revenue increases of greater than 70%, as compared to revenues in 2009. This comes on the heels of 33% and 40% sequential revenue increases in 3Q’09 and 4Q’09 respectively. DRAM ASPs have increased 108% since the industry reached its bottom in December of 2008. The DRAM industry began recovering from that point on, and from October of 2009 to January of 2010 DRAM ASPs have increased another 18%. Industry indications show no signs of ASP deterioration, which will contribute to robust DRAM revenues in 2010.

SoC Design Starts with Mixed Signal Functionality to Grow 22% in 2010.

Phoenix, Arizona March 24, 2010 - The rise in applications demanding increased connectivity and portability have converged to offer new opportunities for mixed signal ASICs. This has come primarily in the form of adding mixed signal functionality to what had been all-digital System-on-a-Chip (SoC) designs. This trend has also impacted the programmable logic market, most notably Field Programmable Gate Arrays (FPGAs) where high speed Serializer-Deserializer (SerDes) channels have been added to facilitate high speed communications channels.

Higher Margins For Foundries and Fabs

On March 17th, 2010, SEMI released its 2009 semiconductor material market statistics.  While the headline pegged worldwide semiconductor material sales at $34.6 billion, that was reportedly a 19% decline in sales compared to 2008.

Although SEMI stated that was not as bad as the 26% decline suffered by material suppliers in the devastating 2001 down cycle, the numbers aren’t easy to swallow.

Table 1:  Semiconductor Revenues, Units, Wafers, Materials


Source:  SEMI, SIA/WSTS and Semico Research Corp. SIA/WSTS reports that total semiconductor units dropped by 5.6%.  Semico Research's analysis determined wafer demand only dropped by 2.7%.  How did the materials going into the making of these chips and wafers decline by 19%?  Even total semiconductor revenues only declined by 9%. Here are some possible reasons.

Wafer Demand Summary and Assumptions 1Q10

The Wafer Demand Summary and Assumptions is a quarterly publication. It includes an excel spreadsheet with annual wafer demand by product by technology from 2002-2013. Product categories include DRAM, SRAM, NAND, NOR, Other Non-volatile, MPU, MCU, DSP, Computing Micro Logic, Communications, Other Micro Logic, Programmable Logic, Standard Cell, Gate Array, Analog, Discrete, Optoelectronics, Digital Bipolar. In addition, there is a five-page summary write-up providing the major assumptions behind the forecast and changes from the previous quarter.

Table of Contents: 

Getting Your Head Around Petabytes

I can always count on my children to inspire and inform me on matters of technology.  Usually this is about the latest thing in social networking or consumer electronics.  Sometimes I can blow them away with my knowledge.  “Wow, Dad knows stuff!”

It is spring break in Arizona.  My son, a college sophomore, was home from Northern Arizona University.  He wanted to get back to NAU early so he could have fun with classmates.  We stopped at Costco on the way out of Phoenix for a few things.  As we walked by the electronics section I chuckled and said “Can you believe you can now get a terabyte of HDD for about 100 bucks these days?”  We got him a 1.5 TB external HDD for Christmas for about $150.

He pondered that comment a bit and then asked me “What’s the next thing after terabyte?” I answered that it was petabyte – 1,000 times more or 1024 in binary.  He shook his head in amazement.  “I just cannot get my head around the concept of petabyte, Dad.”

Third Party Semiconductor Intellectual Property (SIP)

Summary of Semico Outlook 2010 Presentation by
Alex Shubat, President and CEO, Virage Logic

One of the great stories of the early 21st Century in the semiconductor industry is the rise of the 3rd Party Semiconductor Intellectual Property (SIP) market and the vendors that populate it. This market has been created and driven in turn by the rise of the System-on-a-Chip (SoC) market and the need to provide higher levels of performance to meet changing market needs while at the same time allowing for increased integration of functions. All this has been against a backdrop of continuing technological evolution towards smaller process geometries and customer expectations of ever-lower silicon price points.

The over-riding reason behind all of these separate trends has been the disaggregation of the semiconductor industry starting all the way back in the 1970’s when semiconductor companies decided they could no longer build their own silicon production equipment. The trend continued with the creation of Electronic Design Automation (EDA) companies and tool sets and evolved further with the rise of independent silicon foundries and now with the rise of the 3rd Party SIP industry. At each juncture, as what had been ‘traditional’ semiconductor manufacturer functions were outsourced, the semiconductor market has itself grown in revenues, unit volumes and impact on the daily lives of people around the world.

The Semiconductor Industry and Green Power

Echoing the general theme of the day at the Semico 2010 Outlook conference; namely the growing importance of controlling, manipulating, generating, conserving and transmitting power, eSilicon CEO Jack Harding addressed the issue in his keynote speech, summarized as follows. 

Developing counties such as India and China have ever-increasing appetites for the kind of inexpensive, plentiful and reliable sources of energy already available in the developed world. More energy resources are needed in developing countries to provide clean water, electric lighting, heating and cooling and other aspects of a comfortable life the developed world takes for granted. Increased energy resources are also required to provide the computing power and all-pervasive connectivity becoming available to billions of people around the world.

Although the growing markets for electronic products benefit many companies, the environmental impact of generating the power required by those devices is beginning to be a concern. Many are beginning to question whether or not sales of ever larger numbers of electronic devices, requiring ever larger amounts of power, is necessarily a good thing. Those questions are leading to demands for “Green” processes and initiatives.


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