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300mm is the new 200mm!

August 14, 2013 Comments off

300mm fabs.

Buyers of 300mm fabs.

300mm is the new 200mm, said GlobalFoundries’ David Duke, during a presentation titled ‘Used Equipment Market’ at the recently held Semicon West 2013 in San Francisco, USA. Used semiconductor equipment sourcing and sales is a very interesting challenge.

Qimonda, Spansion, Powerchip and ProMOS had jumpstarted the market. Now, there is a broadening user base. There is an unexpected uptake by analog and power device producers to achieve economies of scale. There has been legacy logic scaling. Also, the 200mm fabs are being upgraded to 300mm with used equipment. Many 300mm tools can “bridge” to 200mm easily.

Parts tools are seeding the ecosystem. Third parties are also able to support refurb as well as tool moves. However, we need more! Software licensing is becoming a smaller hurdle. There has been no over-supply yet!

So, what are the ‘rough’ rules of thumb for 300mm? First, there are approximately 1,500 individual tools in the open market. Few sellers know the values as the market is still developing. Twenty percent of the transactions drive 80 percent of sales. Today, the number of 300mm buyers is around  1/10th the number of 200mm buyers!

Lithography has been the biggest difference. Leading edge DRAM is far more expensive in lithography. Lithography has seen the most dramatic financial effects with explosive pricing in technology (immersion) and the need for capacity (two-three critical passes vs. one with dual/triple gate patterning. As of now, financial shocks and bankruptcies are the main drivers for used 300mm.

Next, 200mm is now the new 150mm! The 200mm OEM support is starting to dry up. It is nearly impossible to compete in productivity vs. 300mm. Oversupply is causing values to stay suppressed. The only bright spot being: there is still strong demand for complete fabs. The 200mm market split is roughly by 40 percent Asia and 60 percent rest of the world.

So, what are the likely alternative markets for 200mm and 300mm fabs? These are said to be MEMs and TSV, LEDs and solar PV.

That brings me to India! What are they doing about fabs over here? This article has enough pointers as to what should be done. Otherwise, the world is already moving to 450mm fabs! Am I right?

Critical success factors for MEMS commercialization


MEMS

MEMS

MEMS still has a long way to go to meet the challenges of commercialization! Critical success factors include efficient process transfer from breadboard to production. There is a need to pay attention to customers’ needs. More resources need to be adopted from the semiconductor industry, said Roger Grace, president, Roger Grace Associates.

There is a need to create significant awareness as to the unique solution benefits of MEMS based systems and establish defensible product differentiation. Firms need to better understand customer/market needs.

Emerging opportunities include single MEMS based system solutions, especially in analytical instruments, double magnetic MEMS, triple point-of-care bio, energy harvesting/storage, etc. There are barriers to commercialization of MEMS. Until recently, it is plagued by lack of high-volume apps. There is lack of well-defined direction from roadmaps, industry standards and associations. Packaging and testing costs are typically at 70 percent of total value. There is also a lack of focus on customer needs and lack of capital formation opportunities, risk averse investors.

Besides, successive bubble busts, i.e., biomems, optical telecom, have seen wary investors. There are very fragmented markets, many small companies and few large players. Also, there are limited ‘success stories’ of MEMS/MST companies, eg., Invensense. There are new market opportunities for large volume apps, eg. in automotive, CE, etc.

Downturn hit research hard! R&D remains a novelty for most firms. Now, there is an increase in university and R&D labs for MEMS development. There is still plenty of R&D available from DARPA, SBIR and STTRs. Now, we are seeing a healthy amount of activity in new devices and systems research.

As for DfM (design for manufacturing), Invensense’s ‘shuttle’ process may finally become a usable standard. New approaches are also changing the paradigm of cost structure. Examples are Invensense gyros, Freescale chip-stacking accelerometers, ST, etc.

While there seems to be strong MEMS infrastructure, there is some fraying at the ends. The industry needs to remain competitive and lean. As for profitability, while the margins don’t seem great for high volume MEMS devices, they are holding on somewhat. The general consensus of the VC community has been that MEMS has lot of growth potential, but it doesn’t have a good track record of producing profitable firms, as yet.

The lack of DfM emphasis and the absence of a coherent package and test capability is the lack of management insight. As for standards, the creation of the first Standardized Sensor Performance Parameter Definitions is a huge step in the right direction.

Strong impact of recession on top 30 MEMS makers

March 23, 2009 Comments off

Presenting: The top 30 MEMS (microelectromechanical Systems) suppliers of 2008, thanks to Yole Développement (www.yole.fr), in Lyon, France.

“For the first time, STM is the third MEMS manufacturer worldwide. Overall sales of the top 30 MEMS manufacturers decreased by 2 percent compared to previous year, reaching $5.5 billion,” says Jean-Christophe Eloy, CEO of Yole Développement. The current economic crisis strongly impacts the 2009 edition of the top 30 MEMS manufacturers.

The preliminary top 30 MEMS manufacturers is based on Yole’s market research and expertise covering the MEMS field with more than 2,500 contacts per year. Yole Développement continues to analyze in detail the MEMS market and to follow the Top 30 MEMS manufacturers to deliver the most accurate information available, specifically in these times of big changes.

Major facts in 2008
In 2008, the MEMS market has seen significant changes in the ranking of the top 30 MEMS companies:

* STM has become, for the first time, the 3rd MEMS manufacturer by $ revenue in 2008.
* Delphi and Sanyo are moving out of the TOP 30 MEMS ranking.
* Kionix and IMT are entering the Top 30 MEMS ranking for the first time.
* IMT is again the world leader in the independent MEMS foundry business.
* HP and Texas Instruments, despite decreases in sales, are still numbers 1 and 2 of the top 30 MEMS ranking.

2008 has been a year of unusual movement in the industry:

* The winners: Eighteen (18) companies have shown growth ($ revenue) in 2008 compared to 2007, with Kionix leading the way with 70 percent, and also Measurement Specialties, STM, Panasonic and Murata, to name a few.

* The loosers: Twelve (12) companies have shown a decrease in sales ($ revenue) in 2008 compared to 2007 (in addition to Sanyo and Delphi exiting the top 30 ranking), with FormFactor, Silicon Sensing Systems and Lexmark showing the largest decrease in sales.

Note: The top 30 MEMS Manufacturers graph only considers companies designing and/or processing Si MEMS chips. So, for example, although Sensata is an important sensor manufacturer, its ceramic technology excludes it from the Top 30 ranking.

Economic crisis, specific impact on each MEMS sector
The economic crisis has definitively had an impact on MEMS companies’ financial results, specifically during Q4 2008. However, this impact is very different according to the various MEMS players’ markets. The automotive business is probably the most dramatically impacted by the downturn. In terms of units, it is in the range of -10 percent to -20 percent less compared to previous years.

However, some companies suffer less than others (as is the case for Robert Bosch for example) but all of them are impacted. The impact is also different according to the maturity of MEMS products. Established devices such as airbag accelerometers are suffering more than emerging devices (e.g. TPMS).

The consequences in consumer markets are also different, depending on the MEMS products. Manufacturers of inkjet heads are suffering a lot, with a decrease of about 15 percent IJH production for 2008. On the other hand, inertial MEMS products for the consumer market are still growing (in the range of a several percent) with some players (e.g., STMicroelectronics and ADI) showing pretty good results.

Major MEMS facts to be highlighted in 2008 are:
* Systron Donner Automotive had a very strong decrease because of its automotive business (- 14 percent in US$). This moves it from 10th position in 2007 to 13th in 2008.
* IJH players are dramatically impacted with a decrease in both sales and units (this is the case for HP and Lexmark, the latter undergoing the strongest decrease for IJH). However, HP is still the number one MEMS company for 2008.
* Texas Instruments has seen decrease in its DLP chip sales by about 13 percent (in US$).
* Thanks to its growth of the consumer market, STMicroelectronics’ MEMS business had a profitable 2008 with US$200M for its accelerometer business (twice 2007 sales). This is + 42 percent in euros. STMicroelectronics moves from 4th position in 2007 to 3rd in 2008.

Although it is probably the automotive MEMS player performing the best in 2008, Robert Bosch underwent a -10 percent decrease in euros compared to 2007. Its 8’’ fab is now ready, but production will start only when the economic conditions improve. So, Bosch is moving from 3rd position in 2007 to 4th in 2008.

* Avago has bought the BAW activity of Infineon in Q4 2008, however this sales volume (Yole Développement estimates to be $38 million) has been consolidated into Infineon’s 2008 financial results.
* VTI is suffering because of the automotive market slowdown (- 10 percent in euro).
* Boeringher Ingelheim microParts showed good performance (+ 9 percent in euro), showing that the biomedical market was not impacted by the crisis.
* Panasonic had a very good 2008 with a 10 percent increase in yen compared to 2007.
* Yole believes Panasonic has taken market shares in gyroscopes from Murata and SSS, which show – 4 percent and – 12 percent decreases in yen respectively. Panasonic is now in 16th position (19th in 2007).
* MEAS’s good performance (+ 57 percent in US $) is explained by the integration of Intersema’s sales results. MEAS is now in 19th position (24th in 2007).
* FormFactor underwent the strongest decrease (- 51 percent in US$). This moves it to 27th position (20th in 2007).
* IMT did quite well (+ 15 percent in US $), while Colibrys was affected (-19 percent in US $ and closing of its US activity).

This year, Sanyo and Delphi have disappeared from the 2008 ranking; Sanyo has stopped its foundry activity and Delphi has dramatically reduced its MEMS staff. We believe that only development/assembly will be kept.

How will the future be? Such a crisis will come to an end only when device stock levels fall. Some information from Taiwanese players seems to indicate a restart of semiconductor production. Although it could also be the case for MEMS, Yole believes that 2009 will be a flat year for the MEMS market.

Consumer MEMS shine amid gloom: iSuppli

January 28, 2009 Comments off

I was fortunate enough to attend a webinar on MEMS organized recently by iSuppli. The webinar looked at the growth potential of this segment, especially during the downturn, as well as some top MEMS suppliers.

According to Jeremie Bouchaud, director & principal analyst, both consumer and mobile MEMS supply has been exploding. The overall MEMS market is likely to grow from $1 billion in 2006 to $2.5 billion in 2012! There will be strong acceleration due to growth of cell phones — a hotbed for MEMS, he said.

However, the share of MEMS for rear projection TV is vanishing. A market worth $300 million in 2006 is slowly disappearing, and will, in fact, disappear by 2012. Among other growth areas, personal navigation devices (PNDs) and remote controllers will also see growth.

Consumer and mobile market by MEMS device
The main segments include accelerometers, as well as gyroscopes, RF MEMS switches and capacitors, microphones, etc. The penetration of MEMS devices in CE products is said to increase quite fast.

MEMS growth in cell phones will be faster. It will grow from 3 percent in 2007 to 10 percent in 2008. All of the new, best selling smartphones, such as the iPhone, Nokia N95 and N96, Samsung Omnia, HTC Diamond, Google G1, Blackberry Storm, new Palm OS, etc., have accelerometers. A number of mid range phones also have accelerometers, eg. Sony Ericsson’s models.

MEMS usage is also growing in gaming. From 1998-2005, there was technology push with limited success. However, in 2006, Nintendo showed the way with its Wii, as did the Sony PS3. Microsoft did not enter this field back then!

Interestingly, 2006-08, motion sensing unveiled new, untapped target groups for gaming — the so called casual gamers. In Xmas 2008, Microsoft also embraced motion sensors with accessories. Hence, the penetration of motion sensors has really improved. The next third generation platform will include accelerometers and gyroscopes.

Top 15 MEMS suppliers
The key question: who all are shipping these products? According to iSuppli,The top 15 MEMS suppleirs for CE and mobile phones are: STMicroelectronics, Texas Instruments, Avago Technologies, Knowles, Analog Devices, Murata, Kionix, Epson Toyocom, Invensense, Panasonic, Bosch Sensortec, Freescale, Hokoriku, VTI and Memsic.

Some other companies to watch are:
Accelerometers and gyroscopes: Qualtre, Oki, Wacon, Alps, Virtus, Ricoh.
Pressure sensors: Intersema (MEAS), Metrodyne.
Microphones: Infineon, Wolfson, Memstech, Yamaha, Omron, Panasonic, MEMSensing, AAC, Goertek.
Pico-projectors and other MEMS displays: Microvision, Nippon Signal, Samsung, Konica Minolta, Scanlight, Qualcomm, Pixtronix, Unipixel
RF MEMS switches and capacitors: Wispry, Epcos, RFMD, Baolab.
MEMS oscillators: SiTime, Discera, NXP, Seiko, Intel.
BAW filters: Triquint, Skyworks, MEMS Solutions.
MEMS actuators for autofocus and zoom: Simpel, Sony.
Micro-fuel cells: Angstrom, Tekion, Medis.

It is understood well that not all of these companies will be successful. However, they all need to be monitored carefully.

Commenting on cell phones as a hotbed for inertial and magnetic sensors, Dr. Richard Dixon, senior analyst MEMS, iSuppli, said that the market for accelerometers, gyroscopes and magnetometers is in cell phones. This market will reach $730 million in 2012. Gyroscopes are not in the market yet, and are likely to enter by 2010. The total growth rate is very fast. In units, the annual growth rate is said to be 97 percent.

Interestingly, Apple has contributed significantly to growth of MEMS. The iPhone had a great application. Other vendors followed suite with a ‘me too” strategy. Apple also had sustainable business model with downloads on the Apple Store. The chicken and egg issue of price was solved. Also, with the iPhone, there was a free field test of motion sensing based applications.

Major suppliers of accelerometers for cell phones today, include STMicroelectronics, Bosch Sensortec, Analog Devices, Hokuriku, Kionix, MEMSIC, Freescale, Oki. Of these, ST has really been very impressive, while Bosch saw impressive growth in 2008. MEMSIC dropped share in 2008.

Navigation in cell phones next big thing
According to Dixon, navigation in mobile phones is the next big thing. Leading navigation markets by platform are: mobile phone navigation, smartphone navigation, PNDs, car aftermarket and car OEM in-dash, respectively. By 2010, the mobile phone/smartphone navigation segment will account for over 60 percent of the market.

Similarly, magnetic sensors will take off in 2009 for e-Compass. There has been penetration of magnetometers in GPS phones. They have been around since 2003 in Japanese phones. These rather esoteric applications and also had technical issues.

There were successful implementations in 2008 for navigation. Eg., the G1 Street View, and the Nokia 6210. Also, 3D compass in combination with 3D accelerometers.

The leading suppliers in this space today, include AKM, Honeywell, Yamaha, Aichi Steel. In the R&D segment, the leading players are said to be Alps, Omron, Memsic, Oki, ST, Freescale, Demodulation. Growth will be steep from 2009 onward, and take off from 2010 up to 2012.

Another growth are is the multi-sensor packages and IMUs (Inertial Measurement Unit) for navigation. Today, we have six-axis e-compass combining magnetic sensors and accelerometers. In future, there will be IMU for LBS and indoor navigation also using gyroscopes.

The issue with gyroscopes is of: performance, price, size, power consumption and no availability of three-axis. Companies that need to be watched in this space are said to be Invensense, ST, Bosch Sensortec, Qualtre, Oki, Virtus.

Other opportunity areas
Later, Jeremie Bouchaud highlighted two other opportunity areas.

MEMS microphone market presents a major opportunity. It will reach close to $400 million by 2012. In 2008, already 325 million units were selling in cell phones and laptops. Leading players in this segment are said to be Knowles, Akustica, Infineon, Sonion, Memstech, AAC. Knowles has over 90 percent of the market share.

MEMS pico projectors is another growth area. Companies have made lot of progress in this segment. The pico projectors come in various varieties.

In the MEMS scanner based segment, the R&D is led by firms such as Microvison, Konica, Minolta, Scanlight, Nippon, Signal, Symbol. These solutions came first as stand alone projectors. Later, it will come on cell phones. The best opportunity is said to be at the module level.

Another sub-segnent is the DLP based projectors. First it will be in form of a pico-projector, later, followed by usage in cell phones.

Bouchaud advised watching out for non-MEMS alternatives, such as Light Blue Optics,
3M and Logic Wireless.

Coping with commoditization and price erosion
The ASP of MEMS devices for CE and mobile phones is dropping at -13 percent per year. So, what are the ways to get profitable?

To be profitable, there is a need to achieve economies of scale by combining consumer and automotive. Also, there is a need to move wafer size to 8-inch. Next, there is a need for externalizing to foundries. ADI and TSMC have already showed the way. Now, USMC, Tower, Dongbu, Magnachip, Omron, etc., are following.

Innovation, in terms of packaging and 3D integration, test, multi-sensor packages, is another way for making profits. There is an opportunity for the equipment suppliers as well.

Consumer MEMS is currently glowing as a light in today’s dark times! It is said to grow from $1 billiom in 2006 to $2.5 billion in 2012, with 19 percent CAGR. This optimistic forecast has already started. Accelerometers are present in 10 percent of cell phones in 2008 as against 3 percent in 2007.

There exist a number of opportunities. Small companies can be successful, eg. Kionix and Invensense. There are still opportunities for newcomers. These can be large companies, fabless startups, foundries, software companies, equipment suppliers, etc. Consumer MEMS is an extremely dynamic market, having fast design cycles.

Motion sensors driving MEMS growth

September 8, 2008 Comments off

In a recent report, iSuppli predicted that driven by new demand from consumer electronics (CE) and wireless applications, the global market for microelectromechanical systems (MEMS) will expand to $8.8 billion in 2012, up from $6.1 billion in 2006.

I caught up with Jérémie Bouchaud, Director and Principal Analyst, MEMS, iSuppli Corp., to find out more about the dip in the fortunes of the mainstay products and the latest trends in the MEMS market, especially, the significance of consumer electronics applications such as motion sensors for gaming, laptops and DSCs, and mobile handsets.

Will the mainstay products for MEMS actuators, inkjet heads and DLP chips, will lose market share? Or, is it a slight dip?

Jérémie Bouchaud says that MEMS actuators, include inkjet and DLP, and also RF MEMS switches. While selling prices stay constant, MEMS inkjet heads are losing shipments at a rate of 6 percent per year over the forecast period, so the market grows only slightly at 0.4 percent CAGR from 2006-2012.

DLP shipments continue to grow, but price erosion is running at 10 percent CAGR, which means that the market is shrinking at close to 5 percent per year to 2012. RF MEMS switches are the one bright spot that helps the market for this type of MEMS device to recover slightly in 2012. RF MEMS switches will grow at 100 percent CAGR over this time to top $260 million in 2012.

The new wave is partly founded in the rapid rise of consumer electronics applications such as motion sensors for gaming, laptops and DSCs, and mobile handsets. How much share are these segments likely to garner?

According to the analyst, all types of sensors in wireless communications and consumer electronics (inertial, pressure, microphones, filters, oscillators etc) exceed $1,5 billion: or 17 percent of the total MEMS market.

“Specifically, the motion sensing opportunity, including accelerometers and gyroscopes, for consumer applications like MEMS accelerometers for mobile phones (e.g., image rotation such as in iPhone and Nokia phones), gaming (Nintendo Wii, Playstation 3), etc., and gyros (mostly digital still cameras and camcorders, gaming like Playstation 3) will grow at over 20 percent CAGR from 2006 to 2012 to exceed $680 million, about 8 percent of the total market,” he said.

iSuppli has also mentioned automotive as a key area for MEMS. What kind of growth does it see for automotive?

Bouchaud adds that automotive will grow at 8 percent CAGR to reach $2.1 billion in 2012, up from 1,3 billion in 2006. The market is largely driven by mandates for tire pressure monitoring, electronic stability control systems and reduced emissions, accelerating growth for pressure and inertial sensors.

So, will “new players have a chance to address a relatively open market”, and if yes, what would those markets be?

Bouchaud indicates that the consumer electronics market is more open than the automotive sector, which features established, long-term supply arrangements, and production cycles lasting five or more years.

CE applications are characterized by fast time-to-market and short product lifetimes. For example, mobile phones that change yearly or even more frequently, and supply agreements satisfied by fast manufacturing ramp-up and ability to meet seasonal demand spikes, and often several suppliers in the same product, (e.g. ST and ADI in Wii). As sensor specifications are more relaxed than automotive, price and footprint are most decisive.

Will there be a growth in dedicated mass production facilities then?

According to him, several large MEMS players, e.g., STMicroelectronics, Freescale and Bosch Sensortec, have or are now invested in upgrading to 8″ production facilities to meet the higher demand from the consumer sector. By 2011, at least 12 companies will operate at this larger wafer size.

“Some companies like Analog Devices are at the limit of their current capacity, due to its strong automotive sensor offering, and has recently decided to work with non-MEMS CMOS foundries like TSMC, a first in the industry. UMC will also join the MEMS community, partnering with Asian Pacific Microsystems,” he says.

And, how would the new entrants be investing in R&D? Will they be doing enough?

The analyst says that R&D rates run high in automotive (12-15 percent of MEMS revenues) and even higher in consumer (can be 15-20 percent). The high R&D rate is needed to sustain leading edge products in fast moving markets. Deep R&D pockets are needed, a luxury that is not available to all.

Elaborating a bit more on the market consolidation, he says: ” Today, the share of the MEM revenues in the hands of the top 30 MEMS companies grew at about the same rate as the market. The markets that drive growth in MEMS are consumer electronics and automotive sensors.

“The sensors will be increasingly commoditized due to extreme price pressure in both sectors, and iSuppli expects the production of MEMS devices for these two markets to be concentrated among fewer companies in the future. One facet is manufacturers attempting economies of scale by combining sales in automotive and consumer areas, e.g. at Bosch, and in future with Freescale and ST.

“Other companies are pioneers and hold a strong market position for a relatively long time. Examples are TI with DLP chips and Knowles with MEMS microphones. We also expect more M&As in the near future to exacerbate the consolidation.”

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