Professor Hyuk-Jae Lee, SNU, Department of Electrical and Computer Engineering
The measurement of the competitiveness of a founder is “securing IPs”
To develop the system semiconductor industry,
the same environment must be created for IPs and fabless manufacturing,
which would reduce costs and the test period duration and lead to an increase in competitiveness.
Professor Hyuk-Jae Lee, professor at SNU, Department of Electrical and Computer Engineering
There were efforts by the government and the civilian sector to develop our system semiconductor industry, but unfortunately, the competitiveness is falling. The market for APs (Application Processors), which takes up a large portion of the system semiconductor industry, once lead the global market in terms of market share, but the ranking is dropping. When smartphones were first introduced, products from Apple and Samsung all used APs manufactured in Korea, but currently, even Samsung designed their products in such a way that only a portion of their products use Korean APs. Thus, a plan to overcome this crisis in the system semiconductor industry is critical.
The semiconductor industry can be divided into the fabless industry, which designs circuits, and the foundry industry, which manufactures the designed circuits. As the complexities of the designed circuits are getting increasingly demanding, the companies that provide a connection between the fabless manufacturers and the foundries are on the rise, as it is difficult for the fabless companies to design all the circuits by themselves. Thus the current trend is for them to only design by themselves circuits that would differentiate them from competitors, and utilize circuits made by other companies to finish up the rest of the circuit. For example, since the function that allows for connection to a USB can be utilized commonly by many semiconductors, there are companies that specialize in designing this commonly utilized technology. The circuits made by these companies are called IPs (Intellectual Properties).
Competitiveness in IPs also has a large effect on the foundry industry; a good measurement of a foundry’s competitiveness is how much they were able to secure IPs. It is not easy for Samsung Electronics to quickly catch up to TSMC, which secured IP over a long period of time. Companies from the US and the UK are dominating the IP industry, whose importance is increasing, and the competitiveness of Korean companies is weak. One solution to overcome the current system semiconductor industry is through a focused support for the IP industry.
There were ideas for government projects to support our IP industries, but they were not hugely successful. The reason was that the support was focused on the development of IPs, and there was little support for the test trials on those developed IPs. This led to low confidence in the IPs and fabless industries shunned them. For the IP support project to be successful, there have to be plans that would secure the confidence of the developed IPs.
The reason that the confidence in the IPs is low is that the environment that the IP developers use and the environment that fabless industries that make use of the IPs are different. The result is IPs that worked well during development sometimes not operating as designed in other environments. One effective solution that would eliminate this difference in the environment is by having the IP industries and the fabless industries use the same platform. The platform will be designed to allow for the design and utilization of the IPs, and the companies will both use the platform. However, having different companies use a common platform is difficult as each company has put in tremendous effort in designing its own platforms.
Successful system semiconductor companies are mostly large global businesses. It is difficult for our companies to compete with each other and compete against those large companies and still manage to thrive. The Korean system semiconductor industry will get a chance in overcoming the crisis only the IP companies, fabless manufacturers, and foundries all work in hand. A shared semiconductor platform, coined as the “K-Platform”, that all companies can utilize could be an effective solution. By utilizing IPs developed on the platform, the time taken, and the costs of testing the developed IPs can be reduced. The IP company would also benefit if the testing was successful. On the other hand, if the number of tested IPs increases, the competitiveness of the foundries that secured those IPs will also increase. The result is the development of fabless manufacturers, foundries, and IP companies, which in turn develops the system semiconductor industry. However, since switching to the “K-Platform” could be expensive from the companies’ point of view, there has to be aggressive incentives from the government. It is expected for the Korean system semiconductor industry to develop through the usage of the said platform.
Translated by: Do-Hyung Kim, English Editor of the Department of Electrical and Computer Engineering, email@example.com