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ADI holds on to manufacturing amid IoT rise

Posted: 09 Jun 2014 ?? ?Print Version ?Bookmark and Share

Keywords:Analog Devices? IoT? manufacturing? fab-lite? Moore's Law?

"If we can get a process externally we could probably use it. So something like 90nm CMOS we would use the scale of an external foundry. The runs we do internally are often small runs that are not suitable for foundry or they are highly specialised. High-precision op amps we make in-house but we also make CMOS op amps in foundries. A lot of our high-speed ADCs and DACs can be done externally and anything with a large digital content would tend to be done out of house," said Doyle.

So does that mean the outsourcing is increasing or decreasing as a per centage of ADI's production?

Doyle explained that manufacturing decisions are made on a case-by-case basis. "It's not a question of a target. It is what it is. We will continue to develop processes and features that are not available elsewhere. For example in the MEMS space, More-than-Moore, sensors. That's where we see renewed demand to make use of our fabs." Doyle added: "We would add capacity and we have added manufacturing capacity in the past."

ADI announced about $31 million manufacturing expansion for Limerick in 2010 and a roughly $70 million R&D spending program there in 2011. In both cases it received support from the Irish government's development agency. But compared with digital investments these are small amounts and are more about adding capability than adding capacity.

"Well MEMS are tiny and you don't need a lot of wafers to serve this market," said Doyle. For the same reasons ADI is not expecting to change to larger wafers any time soon as 150mm and 200mm are the right wafer diameters for many products.

But if ADI hit the jackpot with a particular circuit would it invest? "Yes, if economics justify it. But it needn't be all or nothing," Doyle said indicating that if a circuit was needed in sufficiently high volume a way to outsource its manufacturing could also be found.

But it is also the case that Analog Devices sold its MEMS microphone business to InvenSense Inc. for $100 million in 2013. It was a case of the MEMS microphones becoming too consumer-oriented and ADI chose to focus on high-performance inertial sensors to serve automotive, industrial and healthcare applications.

At ADI's Limerick site about 1,100 people are employed with slightly less than half that number in manufacturing. "We are busy working on new technology and materials such as non-transistor type processes at the wafer level. So that might be adding electroplating of materials, the addition of polyimide and gold to make transformers. We wouldn't put gold in a regular CMOS line."

Clearly manufacturing still matters to ADI and possibly more than ever as the opportunities to bring wireless, sensing and conversion together increase in the IoT era. But don't expect a sudden leap to manufacturing on 300mm diameter wafers. ADI's business model is focused away from consumer electronics on the higher value, relatively lower volume parts of the market but it will continue to invest with discretion in special processes and capabilities while letting foundries take care of its standard process and higher volume requirements.

- Peter Clarke
??EE Times Europe


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