The Alchemy of Semiconductors

There was a time when handsets were used only for saving phone numbers and
receiving messages. This is not so anymore. Today, cellphones can be compared to
laptops with huge storage capacities. Thanks to semiconductors that have made
some breakthrough changes in hand-held devices. In fact, the mobile segment has
been one of the biggest beneficiaries of the semiconductor industry.

India is now the second largest mobile market in the world. As per a report
by Cellular Operators Association of India (COAI), the mobile subscriber base in
the country is expected to be 893 mn by 2012. This is a 150 mn increase of what
was projected earlier. The main reason behind this is the increasing adoption of
mobile services in rural areas. There is also an untapped and vast opportunity
for locally made products in this market. This will, in turn, boost the growth
of the semiconductor industry.

According to ISA-F&S 2008 study on the semiconductor market, wireless handset
segment held the second largest share (31.2%) of the total available market
revenues. It's evident that MNCs are leveraging their Indian R&D capabilities to
not only develop products for the local market, but also to identify newer
avenues for business globally. In fact, Nokia's Chennai factory is now the
company's largest cellphone manufacturing facility in the world.

One interesting aspect is that even at the time of recession, the mobile
segment has faired better in the Indian semiconductor industry.

The 'Electronics Industry Market Research and Knowledge Network' predicts a
13-15% decline in mobile chipset market growth worldwide through 2009, with
recovery not gaining traction until 2010. However, the mobile segment in the
Indian semiconductor industry is expected to outperform the overall market.

Innovation in applications, processors, and memory; and convergence
technologies in mobiles is expected to drive the growth of the segment. Enabling
broadband on handsets and the adoption of 3G technology will act as a catalyst
in this growth. Growing consumer demand, time-to-market pressures, and short
product lifecycles mean that the product has to be out in the market within a
very tight window, for it to be cost-effective and profitable.

Today, mobiles are not just looked upon as mere communication devices.
End-users want feature-rich handsets-with in-built cameras, GPS capabilities,
and Internet access-without compromising on the form factor. With increasing
demand for sophisticated handsets and advanced features, chip design for mobile
phones is increasingly getting complex and convergence is taking place. This has
taken the semiconductor market to the next level.

Converging Ways

Today, single-core processors are enabling high-end computing and data
intensive applications. Multi-core processors are also gaining popularity, due
to their scalability and performance capabilities.

Next generation technologies, like 3G, will play a big role in enabling
converged devices. There is a demand for multi-core processor chips in India and
the global market, as they deliver greater computing power and consume lesser
energy.

"Semiconductor chips are the heart of converged, futuristic devices and there
will always remain a requirement for chips for newer devices in the future,"
says Ganesh Guruswamy, VP and country manager, Freescale.

Rakesh Agarwal, country manager, Lattice Semiconductor opines, "Convergence
only presents opportunities in the long-run, since it fuels further innovation
of technology and generation of new products."

With the advent of advanced mobile devices and smartphones, the semiconductor
industry is faced with demand for powerful processors, huge memory space, large
screens, and open operating systems. Chip design that enables a user-friendly
graphic user interface is also a requirement.

The launch of mobile computing devices like-smart books that are similar to
smartphones in terms of the form factor, but with higher computing power-have
also given a thrust to the convergence between mobile and computer space.

Says Rahul Arya, MD, Cadence Design Systems, "The kind of convergence that is
taking place is also causing a lot of niche semiconductor players that
traditionally focused on one segment, such as the mobile space, to explore the
potential of chip design for market adjacencies, say for smart books or netbooks."

Mobiles have for sure become hand-held computers themselves, almost a
minicomputer, with-Windows or Android or Symbion OS, 32 bit microprocessor,
great audio/video and connectivity of WIFI, USB, Bluetooth, 4-8 GB memory slots,
email, Internet browsing , NFC, etc.

In-Stat says that the mobile market for mobile/smartphone processor based
solutions is expected to grow at a 22.3% CAGR through 2013, with the highest
total unit growth resulting from hand-held applications like smartphones and
mobile Internet devices (MIDs). By 2013, the market is projected to grow to
about 775 mn units.

As Vadiraj R, head, mobile applications, MindTree puts, "The trend what we
notice is that the mobile and computer space is converging through the emergence
of netbooks, tablet PCs, etc. These technologies will get deployed in the
enterprise space depending on the nature of the requirements and complexity."

3G spectrum has just addressed what was much needed-the support of higher
bandwidth on mobile devices. Now to be able to realize the potential of all the
sophisticated gadgets available around, what remains is the challenge of
providing safe tunnel for mobile based financial transactions. Which means, the
IP providers have a much larger role to play in this segment now.

Next Generation Services

Next gen applications and associated services will involve rich media,
streaming, base band connectivity, etc. So, on one hand, they will leverage 3G,
4G, etc, while on the device side, devices will need to get powerful and
functionality rich. Hence, the dependence on semiconductors is likely to
increase.

According to Vadiraj R, "We could possibly see advancements where e-books can
be integrated and then smartphones being utilized in that context. This
obviously would require the necessary functionality from the chipset vendors."

The use of semiconductor is allowing hand-held devices to be able to support
more and more applications, which clubbed with higher bandwidths are presenting
greater opportunities for services providers to develop HD content, mobile based
financial transactions, entertainment, etc.

"Availability of broadband data rates (due to the use of next generation
semiconductors) will allow many interesting content/services for all categories
of users," says Rajat Gupta, MD, Beceem Communications.

Applications will have multi-dimension advantages like-students could get
access to online libraries including books, journals, and live video lectures;
professionals, such as lawyers, could similarly access court judgments, and
finance experts could access and transact stock markets while on the move with
near-zero latencies.

"Over-the-air upgradation of features by software downloads (pushed by the
operators) along with auto-installation will make it easier for operators to
start new customers at a base functional level and then incrementally grow the
support without a large increase in their support staff," explains Gupta.

Xilinx, a major player in the digital programmable logic device (PLD) market,
is high on hopes with the Indian market. Says Fai Yeung, vice president, sales
and marketing, Asia Pacific, Xilinx, "Since India still has to develop its
indigenous market in designing, so perhaps the market can look at this niche
segment and then an overhaul of products can take place."

Power Impact

Most of the vendors are trying to address the key issue of power
consumption. Some inroads are being discovered to meet the needs of the
situation. Power consumption is a relevant issue in the current scenario.
Shortage of electricity and increasing concern for the environment has made
customers of semiconductor companies demand energy efficient chips that support
green mandates for a range of applications-from the latest automobiles, to
telecom and networking.

According to Guruswamy, "Ultimately,, energy efficiency is measured against
customer needs. Whether the application requires a longer battery life or needs
to reduce heat dissipation, the system designers have to rely on semiconductors
that meet their performance requirements without exceeding a limited energy
budget."

Energy efficient products are the need of the hour. Processors like MPC8548/E
offer a wide range of high-speed connectivity options. Support for these
high-speed interfaces enables scalable connectivity to network processors and/or
ASICs in the data plane while the MPC8548/E handles complex, computationally
demanding control plane processing tasks.

Larger scale of integration into smaller geometries is allowing the reduction
in overall power consumption of semiconductor devices. Thus, reducing the system
level power consumptions.

Battery life has been an important consideration for a long time. Chip
designers need to design circuits that consume less power not only when the
device is active but also during standby mode.

"As complex semiconductor designs migrate to sub-90nm process nodes, power
management becomes a serious concern across the entire design and manufacturing
chain. Existing chip design techniques must be upgraded holistically to automate
design techniques," suggests Arya of Cadence Design Systems.

Across the design and manufacturing chain, an urgent need has emerged for an
automated, power-aware design infrastructure.

Ashok Kumar Chandak, senior director, NXP says, " The power saving and
increased efficiency of power use is very important. In addition, most of the
semiconductor parts used in the phone are specifically designed for the lower
power consumption."

Requirements

The major requirements of mobile segments are low power and multi-mode
access. The multi-mode access is a requirement that has begun to surface over
the last year. Several operators with 3G (or equivalent) spectrum want to be
able to offer seamless mobility across WiMax and previous generation
technologies to offer customers a graceful degradation to 3G or 2.5G in
locations where WiMax is still not deployed.

As the multimedia and NFC enabled handsets are increasingly being sought
after, the semiconductor industry is looking to cash these opportunities. The
need to support multi-mode functionality in very compact form factors, and to
sustain high data rates while even at building basements or other low signal
locations are another set of challenges that companies are facing.

Design at these advanced process nodes poses its own challenges such as
verification, analog mixed signal integration, and DFM (design for
manufacturing). Says Arya, "The graphic user interface (GUI) needs to gives
access to all features of the mobile phone, and yet be user-friendly. These
complex SoCs (system on a chip) are designed at advanced process nodes to enable
designers pack more functionality."

"Enterprises are now warming up for the mobile applications. They are seeing
value from using mobile as a channel," observes Vadiraj R. Development of
application store related applications is showing traction.

Chandak of NXP says, "Most of the handsets use ARM processors. More functions
are being integrated in the baseband chip, including the integration of RF and
power management."

Asserts Agarwal of Lattice Semiconductor, " Smartphones are in vogue. This
requires supporting chipsets to be of higher processing capability, more storage
capacity, etc. Hence, the semiconductor devices that run smartphones are
complicated high ASP devices as against the standard ASIC's typically used for
mobile phones."

Smartphone is another category that has caught the attention of the
semiconductor industry. The class of the phones needs to allow better
integration of the hardware and software components. Hence the chip needs to
take care of power optimization.

The value can come from productivity improvements, efficiency benefits, ease
of use, and greater collaboration opportunities. As communication is
transforming the country's future, the semiconductor industry is helping it to
have a major leap in the coming times, to make the telecom industry remain in
the best of times.

Archana Singh

archanasi@cybermedia.co.in