IOT, Priming The Market

No matter who you talk to, from material vendors to OEMs, semiconductor equipment suppliers, designers, fabless companies, IDMs, or foundries, IoT is a popular subject. Every industry publication you may read or conference you attend, IOT is at the forefront of every discussion. This was certainly true at DAC last week. I was on a breakfast panel session sponsored by GLOBALFOUNDRIES and Synopsys on Tuesday morning. The big question is, will IoT be the next driver that will take the industry to its next growth phase? There was a lively discussion of the opportunities for IoT. Semico believes that IoT devices will exceed mobile connections by 2018. However, there are some significant caveats that should be pointed out. The main inhibitors that were discussed were:

• Security and privacy
• Interoperability and ease-of-use
• Low cost solutions

Panelists agreed that these key issues need to be solved in order for IoT to take-off but the importance and priority of each issue differs between panelists.  Security and privacy seems to be a substantial challenge and many of the players within the ecosystem are avoiding this issue and passing the solution up the food chain to the next eco-player. Since the announcement of Heartbleed and the Target hack, privacy and security has become a front and center issue. There truly is an opportunity for an innovator to stand out above the crowd with a new solution.  It will only take one serious security failure to potentially stall IOT. 

Functionality and application needs were listed as a top priority for Dr. Terrance J. O’Shea, Ph.D., O.E., Distinguished Technologist, HP.   If it’s not useful and doesn’t fulfill the consumers’ expectations, there won’t be any need for security because it won’t be installed anywhere. 

Interoperability and ease-of-use is a must.  But currently most players are trying to repurpose old solutions to a new opportunity. Barriers to entry into the emerging IOT marketplace are currently very low. We would expect to see innovative solutions being stitched together to provide a cohesive secure and interoperable solution, thus creating a barrier to entry.  There is a flood of new startups entering the market to address this burgeoning market. Don’t be surprised when we see a shakeout as innovative solutions excel in the market.   Low cost solutions are critical, it is Semico’s position that a configurable SOC that can address hundreds of IoT applications would provide an exceptional solution allowing for amortization over larger volumes and therefore provide a lower cost.

The major take away from this panel session was the winning strategy will be collaboration. Synopsys and GLOBAFOUNDRIES are working together to extend their collaborative efforts in creating intellectual property and manufacturing resources that will help make IoT a reality.  Today, IoT implementations are  fragmented into many markets.  Collaboration will help mitigate risk and allow for designs to be amortized over multiple solutions.   Clearly, this is the wave of the future.