It's interesting to note that none of the merged companies are fabless.
Analog and low-to-mid complexity digital designs don't usually use the smallest, newest, most expensive silicon processes that you need for processors, GPUs, and FPGAs. You generally need capacitors, precision resistors, and wider voltage ranges more than you do billions of transistors.
Maybe now that these older fabs are being forced to run as actual businesses rather than as bleeding-edge science projects, semiconductor design companies are able to bring them back into the fold to avoid dealing with the headaches of being fabless.
It's too bad though, because this adds a huge capital cost to what would otherwise be a really ripe opportunity for a new competitor. This consolidation has definitely brought higher prices and reduced the diversity of available parts.
The unit economics of analog ICs should be very good -- a product that needs 1/100th the silicon surface area and sells for 1/10th the price, using a much cheaper node than a modern digital IC. There should be plenty of room for a company to compete with Analog Devices on price while still making a killing.
None of these companies are pushing the process side and are able to run on old, well-depreciated fabs. Their business is uninteresting to the fabless giants. Why? After all they have old fabs too. But most of the embedded suppliers are forced to be low margin providers (often commodity or quasi-commodity parts only a couple of steps up the food chain from passives). They don’t have any margin to give away to the fabless guys.
Analog is a bit different in that “node” doesn’t really apply, but they are also not in the high value part of the value chain for the most part.
The design cycle time is longer. Every prototype requires a formal agreement with one of the fabs you work with, and usually involves a few million dollars changing hands. A few months is usually the minimum.
Even if it's expensive, owning a fab means you have the option to make prototypes of a design, or of parts of a design. You will never, ever do this if you're fabless.
We're good at simulating digital logic, but simulating analog designs is more difficult, and each process tends to have unique quirks. You want your designers to be familiar with these quirks, which is easier to do when everybody designing and using a process is under the same roof.
If you're making a chip that has exotic needs (voltage ranges, threshold voltages, RF performance, noise, thermal properties, bipolar + cmos, etc.) you will have more ability to tweak the process. Foundry type fabs typically offer a smaller "menu" of options that they're comfortable they can support. For example, I think you might have a hard time competing with some of AD's more expensive ADCs as a fabless semiconductor company.
Don't get me wrong... there are plenty of headaches to owning and operating a fab too.
Did everyone with an interest here see the post here [0] a week ago about free fabbing for 130nm open-source chips?
There's certainly the possibility to do analog chips here, but it would take a big team effort.
(have only dabbled a bit with FPGAs with soft-cores, last project I used one for was ~2009: running Linux on an Altera NIOS core, where we sampled at 100 Msps from an input until we filled up the RAM, then more slowly dumped it over Ethernet to a PC)
Being fabless has quite a few advantages too, the cost of building / running a fab is huge, so can only be afforded by major player, or folks who can live on very old process nodes. Most startups, and even ADI themselves use the later nodes like 16nm with external fabs like TSMC.
The early age of the semiconductor industry was definitely much more interesting than today's world of oligopolies and company consolidation. It's quite disappointing to see the big names in the industry have all vanished.
> today's world of oligopolies and company consolidation
How long until we have to sign a license agreement before we can use an OpAmp? Oh, and the license is only valid for consumer applications. Want to use the OpAmp for enterprise applications? That'll cost you more.
That's if we're lucky. In a darker scenario, all OpAmp designs have been bought by Apple, and you can't even use one if you opened your iPhone because the function has been integrated into the CPU.
Fortunately so far we don't need to sign a license agreement to use an Intel CPU, yet. OpAmp EULA doesn't look like something currently on the horizon. But if an EULAed CPU ever became true, so will an EULAed OpAmp...
> In a darker scenario, all OpAmp designs have been bought by Apple, and you can't even use one if you opened your iPhone because the function has been integrated into the CPU.
Scary, because many microcontrollers already have OpAmps built into them...
Making hardware hasn't gotten any easier except at the edges where open source has taken a hold, but it seems like the only reason you'd want to design hardware anymore is to have more vertical control. Tesla, Apple, Google are all prime examples.
The margins on an OK product just aren't worth it, and to be competitive you have to build the whole thing and provide a reference design that's within 20% of the best out there to even break even. No surprise the market is all oligopolies. If there wasn't open source and affordable fab services coming up, there would really be no hope.
+1. This can be terrible. When Avago acquired Broadcom (and kept Broadcom's name), initially they continued selling existing components for a while, then suddenly discontinued hundreds of discrete RF/microwave parts (some were inherited from Agilent and even Hewlett-Packard's days) because they are "legacy parts". No! It was a huge pain. Many of those, despite their old age, are still good and useful, it's just because the demand and profit from discrete parts are low, and the new management decided it's not worth keeping them.
On the other hand, after Analog purchased Linear, many of the high-performance Linear parts are still sold side-by-side with competing Analog parts today, Analog even created a "Powered by Linear" product line for selling Linear power converter chips. It was a wise decision, apparently the management knew those parts from Linear are of great value. I hope Analog will adopt a similar solution for these Maxim parts.
Yeah, I was using a 30 dBm, L-band part that they discontinued, and had to redesign a PA section. Didn't HP acquire Avantek back in the 90's? I used to use a bunch of ATF-xxx parts.
Discontinued parts also included passive parts originally made by the HP Components subsidiary from the 1980s, such as special Schottky diodes and PIN diodes for RF/microwave applications, up to 10 GHz, still perfectly working today. For example, HP's jelly-bean HSMS‑282x series 6 GHz Schottky diodes was the go-to choice in RF circuits (even at lower frequencies like VHF and UHF) for three decades and still in production as of 2016 - you can find their datasheets with an HP logo, another with an Agilent logo, another with an Avago logo, and the last one with a Broadcom logo - and they eventually came to an end when Broadcom killed them in 2017 after Avago's acquisition.
I was hit by this. On a recent weekend I was tinkering with a DIY software-defined amateur radio receiver design and needed some RF diodes, only to find all of them have been killed, and similar parts from NXP were not stocked by the local distributor, 10-day shipping... A friend told me that they have switched to Skyworks diodes since then. The legendary life and unfortunate death of HP diodes.
That being said, I was disappointed with EE Times’s vacuous take on this merger this morning. They have changed hands, and managed to survive, but like most of the vertical literature are a shadow of their former selves.
Analog and low-to-mid complexity digital designs don't usually use the smallest, newest, most expensive silicon processes that you need for processors, GPUs, and FPGAs. You generally need capacitors, precision resistors, and wider voltage ranges more than you do billions of transistors.
Maybe now that these older fabs are being forced to run as actual businesses rather than as bleeding-edge science projects, semiconductor design companies are able to bring them back into the fold to avoid dealing with the headaches of being fabless.
It's too bad though, because this adds a huge capital cost to what would otherwise be a really ripe opportunity for a new competitor. This consolidation has definitely brought higher prices and reduced the diversity of available parts.
The unit economics of analog ICs should be very good -- a product that needs 1/100th the silicon surface area and sells for 1/10th the price, using a much cheaper node than a modern digital IC. There should be plenty of room for a company to compete with Analog Devices on price while still making a killing.