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Outsourcing can boost IC quality

Posted: 16 Jun 2006 ?? ?Print Version ?Bookmark and Share

Keywords:Jim Lipman? Cain Communications? ic quality? outsource? chip quality?

Face it: Like it or not, design outsourcing is becoming more popular in the semiconductor industry. Those who favor outsourcing chip design outside the United States point to the advantages of lower cost for overhead and labor. If design operations are spread among different geographical regions in different time zones, another plus is the acceleration of time-to-market for the finished product because design is not limited to one working period per 24 hours.

Those who oppose design outsourcing bring up the loss of U.S. jobs and the difficulty of managing remote design operations. However, lost in those arguments is an answer to the question of whether design outsourcing affects chip quality. I think it canand in a positive way.

As chip development and manufacturing complexities grow, so do verifying the chip's design and assuring its quality in the target system. This has resulted in a growth of chip design teams, often with several team members functioning as "experts" in one phase of the design and verification operations, such as timing simulation, physical layout or functional verification.

Consider outsourcing all or part of a chip's design. Assume the engineering cost for chip development outside the U.S. is substantially lower than what it is within the United States. If chip-development companies add manpower to a design team for such tasks as verification and quality assurance, this should result in a higher-quality chip.

Using another body to concentrate on design reuse would result in the additional benefit of enhanced IP reuse for other chips, which would lower the cost and development time of derivative products. Will all this happen? Maybe.

If chip vendors outsourcing design are too greedy, they will look at the immediate bottom line and trim outside design teams to mirror the ones they would have had in the United States. On the other hand, if they increase design team strength abroad to enhance verification, quality and maybe even design reuse, they produce a better product and still reap the benefits of much higher profit margins.

Finally, can outsourcing design really lead to better chip quality? I believe that it can.

The rest of the world is catching up with (and sometimes surpassing) the United States in engineering education and skill sets. Consider the location of major silicon foundries in Taiwan, Malaysia, China and elsewhere, along with chip assembly operations all over the world.

Chip quality on the manufacturing-chain side has not suffered from being located outside the United States. In fact, silicon processing has seen a dramatic quality improvement due to economies of scale and other factors at foundries such as TSMC and UMC.

Design quality can follow the same path if chip vendors have the foresight to enhance outsourced design operations to create better chips. Whether this will really happen on a large-scale basis remains to be seen.

- Jim Lipman
VP of Client Services, Cain Communications Inc.

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