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Old-fashioned models work for analog IDMs

Posted: 03 Dec 2007 ?? ?Print Version ?Bookmark and Share

Keywords:fab-lite? analog IDM? fabless?

Schweber: When you use an outside foundry, you are in effect renting expensive time at a multibillion-dollar facility.

It may be trendy to be fab-lite or even fabless, but for the top-tier analog IDMs, being trendy has never been an objective. Instead, they thrive largely because they prefer to win design-ins by being old-fashioned. And there are good reasons for analog vendors to keep much of their capacity in-house.

A winning analog IC doesn't make money by selling hundreds of thousands of units a month in a spurt, then fading away quickly. The real money-makers sell in modest numbers year after year, a production flow that works for an internal fab but not at an expensive foundry. Further, the deep catalog of leading vendors, with literally thousands of parts is hostile to foundry flow.

Many analog ICs have relatively small die sizes, despite using larger process geometries than digital ICs. As a result, a lot of analog ICs fit on a single wafer. A good analog part has a viable life of five to 10 years or even longer. What outside foundry will want to run your old parts and process, especially if the run is only for a few wafers?

When you use an outside foundry, you are in effect renting expensive time at a multibillion-dollar facility. If, instead, you can own a much cheaper facility and run it at reasonably high utilization, you'll do very well in out-of-pocket cost. Even better, you can pick up used, previous-generation equipment cheaply. To economize further, you can use the facility for many years, without it becoming obsolete. So, you invest less initially, and you keep it going longer. Why abandon that model?

Process is 'secret sauce'
Then there's the IC process itself. Analog ICs generally don't use the latest digital IC processes; instead, they work on the edges of highly optimized, internally developed processes. Along with topology and test, the processes are part of the "secret sauce" of high-performance analog ICs, and they're not available elsewhere.

Many outside foundries can't, or won't, run these analog-only processes. And if they do run your process, your competitors may have access to it. This doesn't mean foundries have no role in the analog IC world. Foundries can effectively support fabless vendors of ICs that have considerable digital content but only modest analog content and that don't push the envelope of analog performance.

There are even analog-only parts that do well at outside foundries. These are midrange commodity parts that run high volumes, don't need the leading-edge performance and are often replaceable with alternate sources.

But the real money for top-tier vendors is not in that niche. It's in parts that push one or more performance parameters to the edge, often on the strength of the underlying process.

Customers will pay a little more for a superlow-noise instrumentation or RF-front end amplifier, since they absolutely must have that performance. And they'll do it for a long time, rather than having to change and reevaluate their circuit design.

- Bill Schweber
Site Editor, Planet Analog

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