Archive for February, 2008

KLA-Tencor invests in EDA firm

Monday, February 18th, 2008

KT Venture Group LLC, the investment arm of KLA-Tencor Corp has invested in the latest round of funding of Pyxis Technology, an EDA company selling IC routing software and service solutions. The new funds will be used to accelerate deployment of the Pyxis NexusRoute yield-aware, auto-router, which was announced last September.

This is yet another example of the trend where different players are “crossing over” or getting the various adjacencies into the fold, in their pursuit of a better and integrated solution for the market; and thus increasing their share of the pie.

We saw this with Cadence acquiring Clear Shape Technologies and also with Verigy’s acquisition of Inovys.

Denali software moves to become fabless IC IP provider

Friday, February 8th, 2008

Denali Software is on the trend of IP providers morphing to provide a complete solution/platform instead of standalone IP blocks. Starting with an offering of memory modules, then adding on semiconductor-related memory IPs to its portfolio, it has now introduced FlashPoint -  a full PCI Express interface platform. The platform includes a complete hardware design ready for fabrication plus a complete software stack and all necessary drivers.

From offering all the separate IP components and related software & firmware needed, a platform for PCI Express seems a natural progression - all the more logical and practical to survive the wave of consolidation.

SMIC’s virtual fab strategy

Thursday, February 7th, 2008

SMIC’s CEO, Dr. Richard Chang announced late last month of the starting of a new IC production project in Shenzhen. Unlike its predecessors, in this project SMIC will register an independent legal entity, the Semiconductor Manufacturing International (Shenzhen) Corporation Ltd., which will set up an IC technology research and development center, an 8-inch wafer production line and a 12-inch fab.” SMIC will use the 300mm facility for 45nm bulk CMOS fabrication in relation to the recent process licensing deal it has struck with IBM.  

SMIC has been successful in gaining significant financial support and services from Chinese regional governments in establishing semiconductor manufacturing facilities in specific regions in the last 18 months. A number of such facilities have been termed as “virtual fabs” - Under this approach, a municipality owns the facility and SMIC manages it, garnering fees and a share of the profit for its troubles. (Though it may receive some government funding for the fabs announced last month, SMIC apparently will own them.)

Now while pure play foundries like TSMC, UMC and Chartered have reduced their capital spending plans keeping in mind a probable recession, SMIC plans to buck the trend and boost its capacity by 31% by year end – prompting fears of a capacity glut which may kick off a price war.

SMIC’s virtual fab strategy has drawn its share of critics who claim that it does not give a level playing field from the financial point of view. However, it’s to be noted that government investment in semicon industry is not new. The point is whether this has given SMIC the initial boost to catch up with the top players. Also with the Shenzhen deal with SMIC owned fabs, SMIC may be re evaluating its virtual fab strategy. 

With China’s semiconductor market, driven by computing & consumer electronics demand predicted by IDC to top  $28 B in 2008 & coupled with the fact that SMIC has distanced itself from it’s initial focus on DRAMs, this expansion may not be such a bad idea for SMIC.