SEMICONDUCTOR INDUSTRY
UPDATE
July 2012
McIlvaine Company
TABLE OF CONTENTS
Maxim Upgrades U.S. Semiconductor Fabs
XP Power Opens Green Fab in Vietnam
Marvell Plans to Become Chip Leader in China
Linde to Boost Ultra-High Purity Bulk Gases Supply
IQE Acquires Cleanroom in the U.S.
Semiconductor maker Maxim Integrated Products Inc. is spending $200 million to upgrade and expand its US semiconductor manufacturing facilities in San Antonio and Dallas, TX; Beaverton, OR; and San Jose, CA. Maxim manufactures about 50% of its products in the U.S.
Maxim will invest approximately $65 million to expand its 380,000 sq.ft. semiconductor fab in San Antonio, purchased from Philips Semiconductors Inc. in 2003. Maxim employs approximately 540 manufacturing and engineering staff in San Antonio. Manufacturing staff will be added over time as the expansion is completed and production ramps to capacity.
The fab makes ICs for mobile electronics -- smart phones, tablet computers, automobile infotainment systems -- and industrial equipment. The new wafer fab equipment (WFE) at San Antonio is needed to keep pace with the complexities and performance demands of new electronics, said Chris Michael, Managing Director of Maxim's San Antonio fab.
Maxim was recently recognized by the San Antonio Water System with a "Refreshing Ideas Award," acknowledging its effective methods to reduce water consumption. Maxim's quadruple dividends project helped the company save 55 million gallons of water annually through changes such as condensation harvesting, third-stage reverse osmosis, and analytical reclaim.
The company will also invest $75 million of the funds to upgrade its 226,000 sq.ft. fab in Beaverton, OR, purchased from Tektronix, Inc. in 1994. The fab makes ICs for electronic devices such as factory automation equipment, GPS and navigation units for cars and planes, satellite systems, and communications devices.
Maxim will upgrade manufacturing equipment, improve process technologies, and convert to newer technology nodes. Maxim employs approximately 540 manufacturing and engineering staff in the Beaverton facility. Manufacturing staff will be added over time as the expansion is completed and production ramps to capacity.
With the aid of the Energy Trust of Oregon, Maxim's Beaverton facility recently initiated an energy conservation program that has saved annually over 3.7 million kilowatt hours of electricity and reduced carbon dioxide emissions by over 1400 tons. The site is actively looking at additional energy-efficiency opportunities in solar-electric power, lighting automation, and boiler plant upgrades.
Maxim also employs approximately 300 workers at its Hillsboro, OR site, which is focused on engineering and administrative functions.
Maxim has approximately 9,300 employees worldwide. This investment is consistent with previously disclosed estimates for capital expenditures in Maxim's fiscal years 2012 and 2013.
Maxim makes highly integrated analog and mixed-signal semiconductors.
XP Power has opened a new manufacturing facility in Ho Chi Minh City, Vietnam, that the company claims is the world's most environmentally advanced power supply manufacturing facility. The fab is the first building in Vietnam to meet the Building Construction Authority's Green Mark Gold Plus certification, which attests that a building meets high environmental standards applicable to buildings in tropical climates.
The facility is said to incorporate the use of sustainable power and energy efficiency, with highly insulated construction, a solar PV array, eco-friendly glass to prevent solar heat gain, low energy lighting, ultra-efficient air conditioning. The facility also collects rainwater for use in the building and for irrigation systems. All the environmental features are managed by a fully integrated building management system.
According to XP Power, their commitment to the environment is also demonstrated across the full range of their products. Comprising highly efficient power supplies rated up to 95 percent energy efficiency and having a low standby power to reduce energy loss when the customer system is idle.
XP Power is the only power supply power supply manufacturer that is a member of the Electronic Industry Citizen Coalition, an organization whose Code of Conduct upholds the highest standards for not only environmental and sustainability issues but also treatment of labor, health and safety and business ethics, the company noted.
Marvell Semiconductor Inc. has declared its goal of becoming the largest semiconductor company in China. With 1,900 people already employed in China and the number climbing, the California-based company is showing its commitment to its China aspirations, and already sees some of its goals within reach.
In an interview with EE Times, Marvell's Shanghai-born co-founder Weili Dai stated the importance of Marvell staying in Silicon Valley, where the entire eco-system of great talent and technologies reside. Yet, Marvell is bent on expanding its interests across the pacific.
In addition to the company's main design/engineering site in Shanghai, Marvell is in the process of establishing a second campus in Nanjing. Although the company is keeping details under wraps, it acknowledges that it's working with the local government and the new site is intended to be of a substantial size.
Marvell's Chinese investments require little explanation. Technology has been rapidly moving and China possesses a highly dynamic market. Marvell's choice of making investments in China is a no brainer. In order to seize these abundant opportunities, the company has to establish its presence in China.
That includes Marvell getting engaged with leading telecom and TV operators and strategic partners in the system and service businesses in the local market. The ecosystem the chip company needs to work with is becoming increasingly local, moving very fast, and integrated with services.
Marvell looks to hedge its bets on its best advantages: being a Silicon Valley-company, where U.S. technology still leads, while being a local semiconductor company in China, responding to Chinese needs quickly.
In China, Marvell is working on a number of different product segments. They include smart TVs, set-tops; Universal Passive Optical Network (UPON) technology, which Marvell claims is the world's only single-chip solution that supports all three fiber media protocols, including EPON, Gigabit Passive Optical Network (GPON) and Active Ethernet; and mobile chips.
Of all its product lines, the mobile group commands the biggest presence in Marvell's China operation, with 800 engineers now devoted to R&D in mobile products.
Although Marvell's mobile chip business has had a great run and a slew of design-wins with Research In Motion's Blackberry products, the chip company's mobile momentum seems to have fizzled a little as RIM began getting squeezed out of the global smartphone market. However, the company claims that the company has enough ammunition in reserve to regain its share. Driving the company's renewed commitment in the mobile business are 800 engineers in China, 200 in the United States and 500 in Israel.
Following is an excerpt from a one-on-one interview EE Times conducted with Ivan Lee, vice president of mobile products at Marvell. He oversees development work both in China and in the United States.
EE Times: Why is Marvell's mobile product team so spread out? And what's the division of labor among those teams in different locations?
Ivan Lee: It's largely for historical reasons. Our 500 people in Israel are largely coming from an Intel X-scale team that Marvell acquired in 2006. Their focus is on 3G, WCDMA development. Marvell's success at getting design wins in RIM's Blackberry was the work of our Israel team.
EE Times: What roles do your China and U.S. mobile teams play, then?
Lee: In China, our focus has been more on the TD-SCDMA work we started four years ago; and now more on TD-LTE development. Our mobile products team in China consists of: silicon designers; DSP designers; those who develop protocol stacks; software developers working on Android and other upper layers. Our 200 people in the U.S. include a SoC design team in Calif.; software engineers and Android development in Mass.; and a silicon validation team in Chandler, Arizona.
EE Times: You said Marvell's 800 people responsible for mobile products in China are engaged in R&D. I find some people use the term very loosely. How do you define R&D?
Lee: The team here did everything from conceptualization of TD-SCDMA to its architectural development and production. I describe 99.9 percent of these 800 people as engaged in R&D.
Marvell bets on LTE for mobile strategy
EE Times: With all due respect, Marvell didn't get into the mobile business in China until 2008. Why did you decide not to buy a company who had already developed TD-SCDMA or acquire anyone who had IPs?
Lee: We actually did look at all the IP options and potential acquisition targets. And we decided that we can do better if we do it ourselves.
Of course, at that time, many people told us that we were already too late to the market. They also advised us that we should purchase some IPs, and we should be using protocol stacks that have matured.
EE Times: Who already had TD-SCDMA solutions on the market in 2008—when you decided to join the baseband fray?
Lee: Spreadtrum, Leadcore, MediaTek (after their acquisition of ADI's modem team), etc. The cost for these solutions was high; and we found them integrated poorly. As we were coming from nowhere, we thought we should develop an architecture that scales for the future.
EE Times: Speaking of architecture that scales for the future, are you referring to TD-LTE?
Lee: We are currently working on a TD-LTE modem. The TD-LTE, as it turns out, needs to be not only multimode but also it must respond to multifrequency bands.
China Mobile recently announced the requirement for their TD-LTE. While it needs to be able to operate on TD-SCDMA and GSM inside China, it requires TD-LTE modem to offer roaming capability on 4G and FDD, not to mention 3G, WCDMA. We'll have a TD-LTE modem by the end of 2012, which meets all the requirements set forth by China Mobile.
EE Times: My understanding is that to design a truly multimode, multifrequency LTE with every baseband flavor in it – including TD-SCDMA – is not easy to do, even for Qulacomm. Is that right?
Lee: True, because not everyone has a complete solution. But at Marvell, we do. Our coming LTE solution will be universal – not only applicable for China Mobile but for the worldwide market.
EE Times: I see Marvell betting on LTE for the company's mobile strategy. But what about the growing mid- to entry-level smart phone market? Some say Marvell took its eyes off on that segment. Meanwhile, companies like MediaTek are eating your lunch.
Lee: I wouldn't call it us taking our eyes off. We've done very well with our PSX920, dominating China's TD-SCDMA-based smartphone market. But we do understand that the multicore solutions are becoming very important, and our competitors have done very well. Our plan is to roll out over the next two to three quarters a family of TD-SCDMA-based chips – integrated with dual core, quad core and GPU.
EE Times: You say your group is not about "light product development" focused more on customer support – which a lot of multinationals have been doing.
Lee: Ye. We have quite a bit of autonomy here. We execute R&D, product development here in China.
EE Times: Are you at all concerned at all about IP theft or employee retention?
Lee: I understand that IP theft happened in the past. But at Marvell, I must say we've been lucky. We take IP protection very seriously, and we have put our IP policies in place. I think a lot of problems can be alleviated if we check our IP mechanism carefully, train our employees right.
EE Times: What about employee retention?
Lee: Our employees in China are young, and young people tend to move more often. But our work force has been pretty stable. Part of the reason is that we are one of the very few companies doing hardcore development work. That's not very common in China. Our engineering team is well-trained and very specialized.
Linde North America is expanding its capacity to supply ultra-high purity (UHP) gases to one of the world's largest semiconductor manufacturers located in the Pacific Northwest.
Linde North America is a member of The Linde Group, a world-leading global gases and engineering company and a major supplier of products and services to the semiconductor, electronics and solar manufacturing industries.
Linde will expand its facility, located in Hillsboro, Oregon, by adding an additional plant to manufacture ultra-high purity nitrogen and oxygen. These products will be delivered by pipeline to the customer. The new plant is in addition to the two existing ultra-high purity nitrogen and oxygen plants already operating at the Linde site. In addition, Linde will supply all bulk electronic gases, such as hydrogen, helium and argon, to the customer from its reliable infrastructure of production facilities across North America.
Mark Quinn, vice president of Bulk Electronic Gases and Onsites for Linde Electronics and Specialty Gases, said, "Linde is delighted to have the opportunity to supply this long-term customer with their high purity bulk gas needs as they expand their operations. Our facilities and personnel in Hillsboro are world class professionals who understand the needs of our most demanding semiconductor customers and this expansion is testimony to Linde's commitment to the Pacific Northwest and Linde's commitment to the success of this customer."
Cliff Caldwell, vice president and general manager of Electronics and Specialty Gases stated, "Linde's line of Spectra® high purity nitrogen plants are designed to provide the highest purity of nitrogen and oxygen at the lowest total cost of supply. We have engineered these plants to produce high volume gases with less than 1 part per billion impurities and with extraordinary power efficiencies. The supply scheme will support the world's most advanced technology and high volume semiconductor manufacturing site in the world. We are very proud of the team effort that went into this design solution to support our customer."
Linde has been supplying high-purity gaseous to several semiconductor and solar manufacturers in the Hillsboro area since the early 1990s.
The Linde Group is a world-leading gases and engineering company with around 50,500 employees in more than 100 countries worldwide. In the 2011 financial year, it achieved sales of EUR 13.787 bn (USD 18.1 billion). The strategy of The Linde Group is geared towards long-term profitable growth and focuses on the expansion of its international business with forward-looking products and services. Linde acts responsibly towards its shareholders, business partners, employees, society and the environment – in every one of its business areas, regions and locations across the globe. The Group is committed to technologies and products that unite the goals of customer value and sustainable development.
IQE, a supplier of advanced semiconductor wafer products and services, is to acquire the in-house MBE epi-wafer manufacturing unit of RF Micro Devices, Inc (RFMD) headquartered in the U.S. The deal provides Cardiff-based IQE with a fully furnished epi manufacturing plant, including 16 operational MBE tools.
The assets being transferred to IQE include a fully-fitted cleanroom of over 90,000 sq. ft., 16 MBE manufacturing systems and equipment, all housed in a 135,000 sq. ft. stand-alone building in Greensboro, North Carolina.
The value of the transferred assets is approximately US$27 million. The local management and employees for the unit (consisting of 70 people) will also transfer directly to IQE.
There will be no upfront cash outlay for the transfer of the assets. In exchange for the assets, the parties have agreed to a long term wafer supply agreement with a minimum purchase commitment of $55 million over the first two years, whereby IQE will supply all MBE wafer requirements and a majority of RFMD’s MOCVD wafer requirements under a discounted pricing arrangement.
IQE intends to use unallocated capacity from this facility to rapidly accelerate its wafer supply to meet the growing demand for CPV Solar products.
In the UK, meanwhile, the company has enhanced wafer inspection capabilities at its Cardiff facility with the acquisition of a new automated wafer inspection tool supplied by Ohio based Nanotronics Imaging.
The nSPEC tool enhances existing manual microscopy inspection by allowing automated loading and scanning of III-V semiconductor wafer products. The tool has built in intelligence to enable repeatable and quantifiable object recognition to identify, categorize and record wafer features in real-time.
Eliot Parkinson, general manager of IQE’s III-V manufacturing facility in Cardiff said: “The new automated inspection system offers a compelling alternative to manual microscope inspection, with greater repeatability and significantly reduced chance of human error.”
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