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  Date: 27/10/2013

System design trend: OEMs expanding in to SOC design

There are multiple market factors suggesting smart phone/tablet computer or any such mass consumed system OEMs to look at options of having more control over semiconductor IC chip design part of their product. There are three important factors driving this trend.

If you have a look at the tear down analysis of latest iPhone 5S, there are fewer chips. One set for application processing and another set for wireless front-end. Much of the product differentiators of smart phone are supported either in the chip or in the software. So the first clear trend is, application processor chip offers much of the product differentiating features for smart phone OEMs. To be successful in the market, the smartphone vendors need to work very closely with the VLSI design team. So there is an option for OEMs to work closely with fabless design companies such as Qualcomm or have internal VLSI design team or use outside VLSI design services from place like India.

Also one more important trend is the availability of proven silicon IPs from companies such as ARM, Synopsys, Cadence, Imagination, and dozens of such quality Silicon intellectual property vendors. ARM is a clear driver of this trend. Billions of ICs are shipped every quarter, which are designed using ARM processor core.

The third trend is increased availability of foundry services. There are four big fabs offering 32/28 nm foundry services, which are TSMC, global foundries, SMIC, and UMC.

Though having own chip design team is beneficial, but is not everyone's option due to the cost and risks involved. The system on chip design for the advanced smart phone involves handling close to a billion gates, multiple voltage domains (>20), multiple cores (nothing less than quad core), and lot of interface protocols. The cost for such a SOC design is anything in the range of US$ 50 million to 100 million. But for a bigger OEMs the risk is worth. Apple is a good example and is a trend creator of having own chip design team. There are atleast a half a dozen more system OEMs establishing own VLSI teams.


So does this trend also means the big chip vendors turning into system companies! Though there is no such move, it's possible. What is happening is some of the merchant semiconductor companies offering foundry services, and some started selling IP. The number one chipmaker Intel is also offering foundry services. Nvidia has started selling its processor IP core.

Powering this trend is the availability of software tools to automate chip design process. EDA vendors continuously innovating in increasing software power of VLSI design. SOC design is more of a software now, 25% of the value of today’s SoC is in the software, much higher than 10 years back.

SoC, as the name suggests it is a 'system on a chip', so more of system-design goes inside the chip rather than outside the chip, this makes the system design increasingly more of SOC design.
Author: Srinivasa Reddy N
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