A New Foundry Business Model

As we hit the half way mark of 2012, it’s been an eventful year so far.  Conversations swirl around:

  • The need for more 28nm capacity
  • Is 450mm wafer manufacturing really going to happen?
  •  When will FinFET transistors become standard?
  •  Will the foundry/fabless industry continue to thrive? 

There’s no doubt we’re at a crossroads at the most advanced process technology nodes. In order to take positive steps forward, significant monetary and collaborative investments and resources are required from both the manufacturing and design sides of the equation.

The foundry/fabless semiconductor industry is not going to collapse or disappear as some have recently predicted. See the recent report from SEMI.org on equipment spending. But, a new approach to doing business is in order to stay competitive with pure IDMs. The foundry industry has taken huge strides on the ecosystem side to ensure that physical IP, libraries and design flows are all in place as a new process node comes online. That tight working relationship needs to be pushed beyond the partner ecosystem to include the customer’s design teams.

There is a lot to be said for mimicking a more IDM-like relationship between a foundry and its fabless customers. For faster product rollout and ramp to high-volume manufacturing at the most advanced process nodes, integrated relationships between the foundry and its strategic customers where quasi-IDM operating procedures are established is key to the health and growth of the foundry industry. Fabless companies and foundries need to collaborate on the factors that allow products to be manufacturable, crossing traditional customer and vendor barriers. This is already happening as leading fabless companies learn from experience that closer integration with foundry design flows and kits, starting very early in the development cycle, enables faster feedback and improvement to both the product design and the manufacturing process. 

The industry is at an inflection point and the model is changing. A more simulated IDM environment will allow fabless semiconductor companies to be more competitive at the advanced process nodes. As an IDM foundry, Samsung is keenly aware of the advantages that can be gained by this approach. We strive to deliver these benefits to our foundry customers.

What’s your opinion on this topic?  I’d like to hear from you.  Post your comments here.