SARS, AIDS and the design industry

While China's SARS (Severe Acute Reluctance to Speak) has drawn a lot of flak, the electronic design industry's affliction with SARS has hardly been noted.

At the recent Annual Electronics Forum (AEF) organized by the analyst firm Future Horizons, Ray Bingham, president and CEO of Cadence Design Systems, said, 'I don't think anyone remembers a more difficult time. Everyone has been surprised at how difficult 130nm has proved to be.'

Yet 130nm has been around for three years. So why is it only now that the industry has started speaking about the difficulties at 130nm node and below, when products at 90nm have already been introduced, and 65nm nodes are within R&D horizons?

I believe that all the leading players were so obsessed with their eagerness to announce their lead in 130nm technology that they did not want to take the lead in speaking out the problems in implementing this node. However, the magnitude of the problems was too great to remain hidden for long. EDA companies were the first to speak out. Now follows a spate of horror stories from design houses. Some statements made at AEF sum up the immensity of the problems: 'Neither the IDM nor the fabless model is working,' said Susumu Kohyama, corporate senior VP, Toshiba. 'Projects are failing not because of Physics but because of complexity,' said Chris Hamlin, CTO, LSI Logic. 'Moore's Law has almost run aground,' said Roger Blethen, chairman and CEO of chip test system company, LTX. And so on.

If SARS had not hindered the industry from speaking out these problems when they first arose, I think joint efforts in semiconductor designing-a rapidly enlarging recent phenomenon to cut down R&D costsÑwould have come about earlier. Bluetooth is another area afflicted with SARS. Bluetooth was supposed to interconnect all portable gadgets. The technology has made some progress in products such as hands-free headsets and cell phones, but the wirelessly connected utopia it is supposed to be is still under construction. Or under re-consideration? Nobody speaks out. Meanwhile, makers of portable devices are turning to an old-fashioned approach to connectivity: wires. They are throwing their support behind USB On The Go (USB OTG), a variation of the USB standard. While the Bluetooth Web site boasts of 2,000 members, and time and again some glamorous reports appear about Bluetooth, all doesn't seem to be well with it. The growing support to USB OTG speaks indirectly of the situation, though nobody wants to speak out anything directly.

Yet another area afflicted with SARS is AI. The race for AI started 50 years ago. The race still goes on, consuming billions of dollars, but players have started wondering why they are running, and when will the race end? Nobody, however, speaks out. The fact that for the last few years the industry has stopped speaking as enthusiastically as before about fifth/sixth-generation computers speaks volumes about what it does not want to speak.

While SARS is thankfully receding, the industry has a more serious affliction: AIDS (Acquired IC Deficiency Syndrome). This syndrome, acquired in the heady days when IC supply chased demand, makes the industry always anticipate deficient supply and an overwhelming demand for ICs. This anticipation invariably leads to huge investment in capacities to increase volumes. When did the industry first test HIV+ (High Immunity to Volumes)? I think it was in second half of 1990s. Now the industry has become so highly immune to production volumes that even after operating at capacities as low as 20 to 30 percent in the current downturn, it anticipates a deficient supply of ICs and is ramping up its volumes rapidly. Next year should see a 50 percent rise in semi-conductor production volume.

It remains to be seen how this rise in production volume translates into rise in backlog volumes of manufacturers and distributors. The forward-looking statements of market researchers will contribute a lot to this backlog, as in the past.

You can reach Kirtimaya Varma at kirti.varma@rbi-asia.com