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By Zvi Or-Bach, President & CEO, MonolithIC 3D Inc.

As we have predicted two and a half years back, the industry is bifurcating, and just a few products pursue scaling to 7nm while the majority of designs stay on 28nm or older nodes.

Our March 2014 blog Moore’s Law has stopped at 28nm has recently been re-confirmed. At the time we wrote: “From this point on we will still be able to double the amount of transistors in a single device but not at lower cost. And, for most applications, the cost will actually go up.” This reconfirmation can be found in the following IBS cost analysis table slide, presented at the early Sept FD-SOI event in Shanghai.

Gate costs continue to rise each generation for FinFETs, IBS predicts.

Gate costs continue to rise each generation for FinFETs, IBS predicts.

As reported by EE Times – Chip Process War Heats Up, and quoting Handel Jones of IBS “28nm node is likely to be the biggest process of all through 2025”.

IBS prediction was seconded by “Samsung executive showed a foil saying it believes 28nm will have the lowest cost per transistor of any node.” The following chart was presented by Samsung at the recent SEMICON West (2016).

Zvi 2

And even Intel has given up on its “every two years” but still claims it can keep reducing transistor cost. Yet Intel’s underwhelming successes as a foundry suggests otherwise. We have discussed it in a blog titled Intel — The Litmus Test, and it was essentially repeated by SemiWiki’s Apple will NEVER use Intel Custom Foundry!

This discussion seems academic now, as the actual engineering costs of devices in advanced nodes have shown themselves to be too expensive for much of the industry. Consequently, and as predicted, the industry is bifurcating, with a few products pursuing scaling to 7nm while the majority of designs use 28nm or older nodes.

The following chart derived from TSMC quarterly earnings reports was published last week by Ed Sperling in the blog Stepping Back From Scaling:

Zvi 3

Yes, the 50-year march of Moore’s Law has ended, and the industry is now facing a new reality.

This is good news for innovation, as a diversity of choices helps support new ideas and new technologies such as 3D NAND, FDSOI, MEMS and others. These technologies will enable new markets and products such as the emerging market of IoT.

A good opportunity to learn more about these new scaling technologies is the IEEE S3S ’16, to be held in the Hyatt Regency San Francisco Airport, October 10th thru 13th, 2016. It starts with 3D and FDSOI tutorials, the emerging technologies for the IC future. CEA Leti is scheduled to give an update on their CoolCube program, Qualcomm will present some of their work on monolithic 3D, and three leading researchers from an imec, MIT, and Korea university collaboration will present their work on advanced monolithic 3D integration technologies. Many other authors will discuss their work on monolithic 3DIC and its ecosystem, in addition to tracks focused on SOI, sub-VT and dedicated sessions on IoT.

GLOBALFOUNDRIES today unveiled a new 12nm FD-SOI semiconductor technology, extending its leadership position by offering the industry’s first multi-node FD-SOI roadmap. Building on the success of its 22FDX offering, the company’s next-generation 12FDX platform is designed to enable the intelligent systems of tomorrow across a range of applications, from mobile computing and 5G connectivity to artificial intelligence and autonomous vehicles.

As the world becomes more and more integrated through billions of connected devices, many emerging applications demand a new approach to semiconductor innovation. The chips that make these applications possible are evolving into mini-systems, with increased integration of intelligent components including wireless connectivity, non-volatile memory, and power management—all while driving ultra-low power consumption. GLOBALFOUNDRIES’ new 12FDX technology is specifically architected to deliver these unprecedented levels of system integration, design flexibility, and power scaling.

12FDX sets a new standard for system integration, providing an optimized platform for combining radio frequency (RF), analog, embedded memory, and advanced logic onto a single chip. The technology also provides the industry’s widest range of dynamic voltage scaling and unmatched design flexibility via software-controlled transistors—capable of delivering peak performance when and where it is needed, while balancing static and dynamic power for the ultimate energy efficiency.

“Some applications require the unsurpassed performance of FinFET transistors, but the vast majority of connected devices need high levels of integration and more flexibility for performance and power consumption, at costs FinFET cannot achieve,” said GLOBALFOUNDRIES CEO Sanjay Jha. “Our 22FDX and 12FDX technologies fill a gap in the industry’s roadmap by providing an alternative path for the next generation of connected intelligent systems. And with our FDX platforms, the cost of design is significantly lower, reopening the door for advanced node migration and spurring increased innovation across the ecosystem.”

GLOBALFOUNDRIES’ new 12FDX technology is built on a 12nm fully-depleted silicon-on-insulator (FD-SOI) platform, enabling the performance of 10nm FinFET with better power consumption and lower cost than 16nm FinFET. The platform offers a full node of scaling benefit, delivering a 15 percent performance boost over today’s FinFET technologies and as much as 50 percent lower power consumption.

“Chip manufacturing is no longer one-shrink-fits-all. While FinFET is the technology of choice for the highest-performance products, the industry roadmap is less clear for many cost-sensitive mobile and IoT products, which require the lowest possible power while still delivering adequate clock speeds,” said Linley Gwennap, founder and principal analyst of the Linley Group. “GLOBALFOUNDRIES’ 22FDX and 12FDX technologies are well positioned to fill this gap by offering an alternative migration path for advanced node designs, particularly those seeking to reduce power without increasing die cost. Today, GLOBALFOUNDRIES is the only purveyor of FD-SOI at 22nm and below, giving it a clear differentiation.”

“When 22FDX first came out from GLOBALFOUNDRIES, I saw some game-changing features. The real-time tradeoffs in power and performance could not be ignored by those needing to differentiate their designs,” said G. Dan Hutcheson, chairman and CEO of VLSI Research. “Now with its new 12FDX offering, GLOBALFOUNDRIES is showing a clear commitment to delivering a roadmap for this technology — especially for IoT and Automotive, which are the most disruptive forces in the market today. GLOBALFOUNDRIES’ FD-SOI technologies will be a critical enabler of this disruption.”

“FD-SOI technology can provide real-time trade-offs in power, performance and cost for those needing to differentiate their designs,” said Handel Jones, founder and CEO, IBS, Inc. “GLOBALFOUNDRIES’ new 12FDX offering delivers the industry’s first FD-SOI roadmap that brings the lowest cost migration path for advanced node design, enabling tomorrow’s connected systems for Intelligent Clients, 5G, AR/VR, Automotive markets.”

GLOBALFOUNDRIES Fab 1 in Dresden, Germany is currently putting the conditions in place to enable the site’s 12FDX development activities and subsequent manufacturing. Customer product tape-outs are expected to begin in the first half of 2019.

“We are excited about the GLOBALFOUNDRIES 12FDX offering and the value it can provide to customers in China,” said Dr. Xi Wang, Director General, Academician of Chinese Academy of Sciences, Shanghai Institute of Microsystem and Information Technology. “Extending the FD-SOI roadmap will enable customers in markets such as mobile, IoT, and automotive to leverage the power efficiency and performance benefits of the FDX technologies to create competitive products.”

“NXP’s next generation of i.MX multimedia applications processors are leveraging the benefits of FD-SOI to achieve both leadership in power efficiency and scaling performance-on-demand for automotive, industrial and consumer applications,” said Ron Martino, vice president, i.MX applications processor product line at NXP Semiconductors. “GLOBALFOUNDRIES’ 12FDX technology is a great addition to the industry because it provides a next generation node for FD-SOI that will further extend planar device capability to deliver lower risk, wider dynamic range, and compelling cost-performance for smart, connected and secure systems of tomorrow.”

“As one of the first movers of design for FD-SOI, VeriSilicon leverages its Silicon Platform as a Service (SiPaaS) together with experience in delivering best-in-class IPs and design services for SoCs,” said Wayne Dai, president and CEO of VeriSilicon. “The unique benefits of FD-SOI technologies enable us to differentiate in the automotive, IoT, mobility, and consumer market segments. We look forward to extending our collaboration with GLOBALFOUNDRIES on their 12FDX offering and providing high-quality, low-power and cost-effective solutions to our customers for the China market.”

“12FDX development will deliver another breakthrough in power, performance, and intelligent scaling as 12nm is best for double patterning and delivers best system performance and power at the lowest process complexity,” said Marie Semeria, CEO of Leti, an institute of CEA Tech. “We are pleased to see the results of the collaboration between the Leti teams and GLOBALFOUNDRIES in the U.S. and Germany extending the roadmap for FD-SOI technology, which will become the best platform for full system on chip integration of connected devices.”

“We are very pleased to see a strong momentum and a very solid adoption from fabless customers in 22FDX offering. Now this new 12FDX offering will further expand FD-SOI market adoption,” said Paul Boudre, Soitec CEO. “At Soitec, we are fully prepared to support GLOBALFOUNDRIES with high volumes, high quality FD-SOI substrates from 22nm to 12nm. This is an amazing opportunity for our industry just in time to support a big wave of new mobile and connected applications.”

By Christian G. Dieseldorff, Industry Research & Statistics Group at SEMI (September 6, 2016)

SEMI’s Industry Research and Statistics group has published its August update of the World Fab Forecast report. The report has served the industry for 24 years, observing and analyzing spending, capacity, and technology changes for all front-end facilities worldwide, from high-volume to R&D fabs.  SEMI’s latest data show increasing equipment spending, reaching 4.1 percent YOY in 2016 and 10.6 percent in 2017. Figure 1 (below) shows a forecast of  -2 percent decline from 2H2015 to 1H2016 and an 18 percent increase from 1H2016 to. 2H2016.

Figure 1: Fab Equipment Spending by Quarter

Figure 1: Fab Equipment Spending by Quarter

The largest growth drivers for the industry are mobile devices (including devices using SSDs), automotive, and soon anticipated to be IoT, with these applications, in many cases, requiring 3D NAND and Logic 10nm/7nm.

The SEMI report indicates that the two industry segments leading to the biggest increase in 2H16 are Foundry (29 percent) and Memory (21 percent).  Growth in Memory is driven by a significant increase in 3D NAND spending in 2016. Comparing 2016 to 2017, Foundry growth remains quite steady, with a 14 percent increase in 2016 and 13 percent in 2017.

Companies like Samsung, Micron, Flash Alliance, Intel, and SK Hynix drive Memory growth with 3D NAND to an astounding 152 percent increase in 2016 and 29 percent in 2017. However, utilization of all this equipment is still low in 2016 but is expected to increase in 2017.

Looking at other product segments, DRAM equipment spending is expected to decline by 31 percent in 2016 and then recover slightly with 2 percent growth in 2017. Power devices also show strong growth with 25 percent in 2016 and 16 percent in 2017. The Analog segment will slump by -15 percent in 2016 but increase by 20 percent in 2017. Similarly, MPU will drop -20 percent in 2016 and then is expected to increase by 48 percent in 2017.

Comparing spending by region in 2016, SE Asia shows the largest growth, with 157 percent in 2016, driven mainly by 3D NAND (see Figure 2).

China, in third place for overall spending, shows 64 percent growth for 2016 primarily due to 3D NAND by non-Chinese companies, closely followed by Foundry companies. Although the largest spenders in China currently are overseas device companies, China-based chipmakers are starting to pick up investment activity.

Figure 2: Fab Equipment Spending by Region

Figure 2: Fab Equipment Spending by Region

By contrast, the largest growth rate in 2017 is in Europe/Mideast with about 60 percent which is mainly due to ramping of 10nm facilities. Korea is in second place for total spending, mainly driven by Samsung’s investment in DRAM and Flash. Japan in third place driven by Flash Alliance (3D NAND).

The World Fab Forecast report provides more detailed information by company and fab for construction spending, equipment spending and capacities by region and product type.  Since the last publication in May 2016, the SEMI research team has made over 330 changes to 300 facilities/lines. This includes 27 new records and 18 records closed.

For information about semiconductor manufacturing for the remainder of 2016 and in 2017, and for details about capex for construction projects, fab equipping, technology levels, and products, order the SEMI World Fab Forecast Report. The report, in Excel format, tracks spending and capacities for over 1,100 facilities including over 82 future facilities, across industry segments from Analog, Power, Logic, MPU, Memory, and Foundry to MEMS and LEDs facilities.  Using a bottoms-up approach methodology, the SEMI Fab Forecast provides high-level summaries and graphs, and in-depth analyses of capital expenditures, capacities, technology and products by fab.

The SEMI Worldwide Semiconductor Equipment Market Subscription (WWSEMS) data tracks only new equipment for fabs and test and assembly and packaging houses.  The SEMI World Fab Forecast and its related Fab Database reports track any equipment needed to ramp fabs, upgrade technology nodes, and expand or change wafer size, including new equipment, used equipment, or in-house equipment. Also check out the Opto/LED Fab Forecast. Learn more about the SEMI fab databases at: www.semi.org/MarketInfo/FabDatabase and www.youtube.com/user/SEMImktstats

The IC industry’s original system-on-chip (SoC) product category—microcontrollers—is expected to steadily reach record-high annual revenues through the second half of this decade despite an overall slowdown in unit growth during the next five years. Microcontroller sales barely increased in 2015, rising less than a half percent, to set a new record high of slightly more than $15.9 billion, thanks to a 15% increase in MCU shipments that lifted worldwide unit volumes to an all-time peak of 22.1 billion last year (Figure 1). Strong unit growth—driven by smartcard MCUs and 32-bit designs—enabled the MCU market to overcome a 13% drop in the average selling price (ASP) of microcontrollers to a record-low $0.72 in 2015. Price erosion—especially in 32-bit MCUs—has weighed down MCU sales growth in three of the last four years, but ASPs are now expected to stabilize and increase slightly in the 2015-2020 forecast period, rising by a CAGR of 1.6% compared to a -7.7% annual rate of decline between 2010 and 2015.

Fig 1

Fig 1

While ASP erosion is expected to end, MCU unit shipments are forecast to rise at a much lower rate than in the first half of this decade, primarily because of a slowdown in the growth of smartcard microcontrollers and tighter reins on IC inventories for the “next big thing”—the Internet of Things (IoT). IC Insights’ forecasts MCU sales will rise in 2016 to nearly $16.6 billion, which is a 4% increase from $15.9 billion in 2015. MCU unit volumes are expected to grow by 2% in 2016 to 22.4 billion, and the ASP for total microcontrollers is forecast to rise 2% this year to $0.74. Between 2015 and 2020, microcontroller sales are projected to grow by a CAGR of 5.5% to nearly $20.9 billion in the final year of the forecast. Since the middle 1990s, worldwide MCU sales have grown by a CAGR of 2.9%.

As shown in Figure 1, no downturns are anticipated in MCU sales through 2020. Total MCU revenue growth is expected to gradually strengthen between 2016 and 2019 (when sales are forecast to grow 9%) before easing back to a 4% increase in 2020. MCU unit shipments are now projected to grow by a CAGR of 3.9%.

A major factor in slower MCU unit growth through 2020 is the maturing of the smartcard market, which in recent years has accounted for nearly half of microcontroller shipments and about 15-16% of total revenue. By 2020, smartcard MCUs are expected to represent 38% of total microcontroller unit shipments and about 12% of sales.

2016 is a turning point for the Fan-Out market since both leaders, Apple and TSMC, changed the game and may create a trend of acceptance of Fan-Out packages. Yole Développement (Yole) is analyzing the current market and technologies trends and offers you to discover these results within a new report entitled Fan-Out: Technologies & Market Trends 2016.

fowlp_history_yole_aug2016_280x433

TSMC investment in FO WLP and development of InFO changed the WLP landscape. Following high volume adoption of InFO and further development of eWLB technology, a wave of new players and FO WLP technologies may enter the market. TSMC’s FO WLP solution called InFO will be used to package the Apple A10 application processor, implemented in the new iPhone 7 series. The success of FO packaging platforms is so undeniable today. What will be the status of the market tomorrow? What are the next steps of the leading FO players? Which technology will be the winning solutions? Yole’s analysts tell the story.

“Production starts in 2016 and represents a big change in the Fan-Out industry for several reasons”, confirms Jérôme Azémar, Market & Technology Analyst, Advanced Packaging & Manufacturing at Yole. And he explains:

  • First of all, in terms of volume, capturing the Apple processor market is a big asset for Fan-Out technology. iPhone 7 phones are expected to be sold in more than 200 million units.
  • In terms of technology capability it is also a major turn: processors require thousands of connections while the FO market was essentially focused on limited IO count applications so far.
  • Eventually, the potential for market spread is very high: the Apple brand brings more interest to the FO platform.

According to Yole’s advanced packaging & semiconductor manufacturing team, the market will actually be split in two types:

  • The “core” market of FO, including single die applications such as Baseband, Power management, RF transceivers, etc. This is the main pool for FO WLP solutions and will keep growing.
  • The “high-density” FO market, started by Apple APE that will include larger IO count applications such as processors, memories, etc. This market is more uncertain and will require new integration solutions and high performing FO packages but has a very high potential.

Apart from TSMC, STATS ChipPAC is willing to make further investments powered by JCET, ASE extends its partnership with Deca Technologies while Amkor, SPIL and Powertech are in development phase eyeing future production. Samsung is seemingly lagging behind and is considering its options to raise competitiveness. “With such a high potential for the high-density FO and solid growth of the core FO, the supply chain is also expected to evolve with a considerable amount of investment in Fan-Out packaging capabilities,” said Jérôme Azemar from Yole. Several players are already offering FO WLP while many others are developing their competitive Fan-Out platforms to enter the Fan-Out landscape and enlarge their portfolio.

What are the next steps of the leading Fan-Out players? Yole’s FO report analyzes in detail the strategies and offers of main players involved. It describes potential success scenarios for all of them. It also helps to define what FO Packaging is and what are the different products and platforms, player per player.

IC Insights released its August Update to the 2016 McClean Report earlier this month.  This Update included an update of the semiconductor industry capital spending forecast, a look at the top-25 semiconductor suppliers for 1H16, including a forecast for the full year ranking, and Part 1 of an extensive analysis of the IC foundry industry (the ranking of the top-10 pure-play foundries is covered in this research bulletin).

In 2014, the pure-play IC foundry market registered a strong 17% increase, the largest increase since 2010 and eight points greater than the 9% increase in the worldwide IC market.  In 2015, the pure-play foundry market showed a 6% increase, about one-third the rate of growth in the previous year, but seven points higher than the total IC market growth rate of -1%.  For 2016, the pure-play foundry market is expected to increase by 9% and greatly outperform the growth rate of total IC market, which is forecast to drop by 2% this year.

Figure 1 shows that the top 10 pure-play foundries are expected to hold 95% of the total pure-play foundry market this year.  This year, the “Big 4” pure-play foundries (i.e., TSMC, GlobalFoundries, UMC, and SMIC) are forecast to hold an imposing 84% share of the total worldwide pure-play IC foundry market.  As shown, TSMC is expected to hold a 58% marketshare in 2016, down one point from 2015, as its sales are forecast to increase by $2.1 billion this year, up from a $1.5 billion increase in 2015.  GlobalFoundries, UMC, and SMIC’s combined share is expected to be 26% this year, the same as in 2015.

The two top-10 pure-play foundry companies that are forecast to display the highest growth rates this year are Israel-based TowerJazz, which is expected to edge-out Powerchip for the 5th spot in the pure-play foundry ranking in 2016, and China-based SMIC, with 30% and 27% sales increases, respectively. TowerJazz and SMIC have been on a very strong growth curve over the past few years.  TowerJazz is expected to grow from $505 million in sales in 2013 to $1,245 million in 2016 (a 35% CAGR) while SMIC is forecast to more than double its revenue from 2011 ($1,220 million) to 2016 ($2,850 million) and register a 19% CAGR over this five-year timeperiod.

Figure 1

Figure 1

Eight of the top-10 pure-play foundries listed in Figure 1 are based in the Asia-Pacific region.  Israel-based TowerJazz, and U.S.-headquartered GlobalFoundries are the only non-Asia-Pacific companies in the top-10 group.  While LFoundry is currently headquartered in Avezzano, Italy, China-based SMIC agreed in 2Q16 to purchase 70% of the company for approximately $55 million.  Since LFoundry has an installed capacity of 40K 200mm wafers/month, the acquisition of a controlling interest in the company essentially serves to immediately expand SMIC’s capacity by 13% this year.

Although SMIC is forecast to register strong sales growth of 27% this year, Chinese foundries, in total, are expected to hold only 8.2% of the pure-play foundry market in 2016, down 5.1 points from the peak share of 13.3% reached in 2006 and 2007.  IC Insights believes that the total Chinese company share of the pure-play foundry market will increase through 2020, as the China-based foundries take advantage of the huge amount of government and private investment that will be flowing into the Chinese semiconductor market infrastructure over the next five years.

New wafer processing technologies overcome FOWLP’s technical hurdles, paving the way for a new generation of ultra compact, high I/O electronic devices.

BY DAVID BUTLER, SPTS Technologies, an Orbotech company, Hereford, UK

Our ability to create ever-smaller electronic devices that maintain or surpass the performance of their physically larger predecessors – exemplified by today’s wearables, smartphones and tablets – is dictated by many factors that extend well beyond Moore’s Law, from the underlying embedded components to the ways in which they’re packaged together. With regard to the latter, fan-out wafer level packaging (FOWLP) is quickly emerging as the new die and wafer level packaging technique of choice, and is widely antici- pated to underpin the next generation of compact, high performance electronic devices.

Whereas with conventional flip-chip WLP schemes the I/O terminals are spread over the chip surface area, limiting the number of I/O connections, FOWLP embeds individual die in an epoxy mold compound (EMC) with space allocated between each die for additional I/O connection points, avoiding the use of more expensive silicon real estate to accommodate a higher I/O count. Redistribution layers (RDLs) are formed using physical vapor deposition (PVD) and subsequent electroplating and patterning to re-route I/O connections on the die to the mold compound regions on the periphery (FIGURE 1).

FIGURE 1. FOWLP process flow.

FIGURE 1. FOWLP process flow.

Leveraging FOWLP, semiconductor devices with thousands of I/O points can be seamlessly connected via finely-spaced lines as thin as two to five microns, maximizing interconnect density while enabling high bandwidth data transfer. Significant height and cost savings are achieved via the elimination of the substrate.

With FOWLP today we have the ability to embed heterogeneous devices including baseband processors, RF transceivers and power management ICs in these mold wafers, thereby enabling the latest gener- ation of ultra-thin wearables and mobile wireless devices. With continued line and space reductions, FOWLP has the potential to accommodate higher performing devices including memory and application processors, positioning FOWLP to extend into new markets including automotive and medical applications and beyond.

Leading vendors implementing FOWLP today include Amkor, ASE, Freescale, NANIUM, STATS ChipPAC, and TSMC, with TSMC being the most high-profile vendor given its widely-reported contract win to produce A10 processors for Apple’s iPhone 7 – a deal said to be attrib- utable in part to TSMC’s mature FOWLP-based InFO technology.

According to a report entitled “FO WLP Forecast update 09/2015” published by research firm Yole Développement in September 2015, the launch of TSMC’s InFO format is expected to increase industry packaging revenues for FOWLP from $240M in 2015 to $2.4B in 2020. With a projected 54% CAGR, Yole expects FOWLP to be the fastest growing advanced packaging technology in the semiconductor industry.

Low heat, high speed processing

All fan-out wafers feature singulated die embedded in the EMC, with spin-on dielectrics surrounding the RDL. These materials present some unique challenges, including moisture absorption, excessive outgassing and a limited tolerance to elevated temperatures. If not dealt with properly, contamination at the metal deposition stage can compromise contact resistance.

Whereas conventional circuits built on silicon can withstand heat up to 400oC and can be degassed in under one minute, the EMC and dielectrics used in FOWLP have a heat tolerance closer to 120oC. Temperatures exceeding this low threshold can cause decompo- sition and excessive wafer warping. Degassing wafers at such low temperatures naturally takes a longer amount of time, and can drastically reduce the throughput of a conventional sputter system.

Multi-wafer degas (MWD) technology has emerged as a compelling solution to this problem, enabling up to 75 wafers to be degassed at 120oC in parallel before being individually transferred to subsequent pre-clean and sputter deposition, without breaking vacuum.

With this approach, wafers are dynamically pumped under clean, high vacuum conditions, with radiation heat transfer warming wafers directly to temperatures within the operating budget for packaging applications.

Each wafer can spend up to 30 minutes inside the MWD, but because they’re processed in parallel, a “dry” wafer is outputted for metal deposition every 60 to 90 seconds, at a rate of between 30 to 50 wafers per hour. This approach increases PVD system throughput by 2-3 times compared to a single wafer degas processing technology, and as materials emerge with even lower thermal budgets based on increased passivation thickness, longer degas times can be accommodated with no impact on throughput (FIGURE 2).

FIGURE 2. The Sigma fxP PVD system with multi-wafer degas module from Orbotech-SPTS.

FIGURE 2. The Sigma fxP PVD system with multi-wafer degas module from Orbotech-SPTS.

These benefits are not readily attainable, however, unless we can overcome the attendant warping challenges. Epoxy mold wafers can be warped after curing, and the size and shape of the warpage hinge on the different shapes, densities and placement of the embedded die. A FOWLP PVD system must therefore be able to minimize temperature-induced shape shifting, and accommodate wafers with up to a 10mm bow. The acceptable industry threshold for bowing is probably lower than 6mm, however, as it’s not easy to make uniformly thick conductors on a substrate exhibiting 6mm+ warpage.

Utmost integrity

After successful degas, but prior to metal deposition, the FO wafer is pre-cleaned in a plasma etch module. This facilitates the removal of trace oxide layers from the contacts, but due to the composition of the organic dielectric surrounding the contacts, will result in carbon build-upon the chamberwalls.This carbon does not adhere well to ceramic chamber surfaces, and if not carefully managed, can result in early particle failure.

New in-situ paste technologies allow these carbon deposits to better adhere to chamber surfaces during the pre-cleaning process, enabling preventative maintenance intervals that exceed 6,000 wafers. This approach can significantly improve productivity by reducing the frequency of dedicated wafer pastes, which typically require production to be paused every 10 to 20 wafers for chamber pasting when using conventional techniques.

The myriad benefits that FOWLP promises for the production of ultra compact, high I/O electronic devices far outweigh the aforementioned technical barriers to mainstream FOWLP adoption. With the ability to overcome the degassing, warping, and integrity challenges that can impede FOWLP implementations, electronics manufacturers can unlock the full potential of FOWLP while eliminating frictions affecting production speeds and yields.

IC Insights will release its August Update to the 2016 McClean Report later this month. This Update includes an update of the semiconductor industry capital spending forecast, an analysis of the IC foundry industry, and a look at the top-25 semiconductor suppliers for 1H16, including a forecast for the full year ranking (the top 20 1H16 semiconductor suppliers are covered in this research bulletin).

The top-20 worldwide semiconductor (IC and O-S-D—optoelectronic, sensor, and discrete) sales ranking for 1H16 is shown in Figure 1. It includes eight suppliers headquartered in the U.S., three in Japan, three in Taiwan, three in Europe, two in South Korea, and one in Singapore, a relatively broad representation of geographic regions.

The top-20 ranking includes three pure-play foundries (TSMC, GlobalFoundries, and UMC) and six fabless companies. If the three pure-play foundries were excluded from the top-20 ranking, China-based fabless supplier HiSilicon ($1,710 million), U.S.-based IDM ON Semiconductor ($1,695 million), and U.S.-based IDM Analog Devices ($1,583 million) would have been ranked in the 18th, 19th, and 20th positions, respectively.

IC Insights includes foundries in the top-20 semiconductor supplier ranking since it has always viewed the ranking as a top supplier list, not a marketshare ranking, and realizes that in some cases the semiconductor sales are double counted. With many of our clients being vendors to the semiconductor industry (supplying equipment, chemicals, gases, etc.), excluding large IC manufacturers like the foundries would leave significant “holes” in the list of top semiconductor suppliers. As shown in the listing, the foundries and fabless companies are identified. In the April Update to The McClean Report, marketshare rankings of IC suppliers by product type were presented and foundries were excluded from these listings.

Overall, the top-20 list shown in Figure 1 is provided as a guideline to identify which companies are the leading semiconductor suppliers, whether they are IDMs, fabless companies, or foundries.

Figure 1

Figure 1

Thirteen of the top-20 companies had sales of at least $3.0 billion in 1H16.  As shown, it took $1.86 billion in sales just to make it into the 1H16 top-20 semiconductor supplier list.  There was one new entrant into the top-20 ranking in 1H16 as compared to the 2015 ranking—AMD, which replaced Japan-based Sharp.  In 2Q16, AMD registered a strong 23% increase in sales while Sharp was moving in the opposite direction logging a 13% decline in its 2Q16/1Q16 revenue.

Intel remained firmly in control of the number one spot in the top-20 ranking in 1H16.  In fact, it increased its lead over Samsung’s semiconductor sales from only 20% in 2015 to 33% in 1H16.  The biggest upward move in the ranking was made by Apple, which jumped up three positions in the 1H16 ranking as compared to 2015. Other companies that made noticeable moves up the ranking include MediaTek and the new Broadcom Ltd. (the merger of Avago and Broadcom), with each company moving up two positions.

Apple is an anomaly in the top-20 ranking with regards to major semiconductor suppliers. The company designs and uses its processors only in its own products—there are no sales of the company’s MPUs to other system makers.  IC Insights estimates that Apple’s custom ARM-based SoC processors had a “sales value” of $2.9 billion in 1H16, which placed them in the 14th position in the top-20 ranking.

In total, the top-20 semiconductor companies’ sales increased by 7% in 2Q16/1Q16.  Although, in total, the top-20 2Q16 semiconductor companies registered a 7% increase, there were seven companies that displayed a double-digit 2Q16/1Q16 jump in sales and only two that registered a decline (Intel and Renesas).

The fastest growing top-20 company in 2Q16 was Taiwan-based MediaTek, which posted a huge 32% increase in sales over 1Q16.  Although worldwide smartphone unit volume sales are forecast to increase by only 5% this year, MediaTek’s application processor shipments to the fast-growing China-based smartphone suppliers (e.g., Oppo and Vivo), helped drive its stellar 2Q16/1Q16 increase.  Overall, IC Insights expects MediaTek to register about $8.8 billion in sales in 2016, which would represent a 31% surge over the $6.7 billion in sales the company had last year.

As expected, given the possible acquisitions and mergers that could/will occur over the next few years, the top-20 ranking is likely to undergo a significant amount of upheaval as the semiconductor industry continues along its path to maturity.

The year 2016 is not expected to be a good one for the total memory market and the main culprit is DRAM. Declining shipments of desktop and notebook computers, the biggest users of DRAM, as well as declining tablet PC shipments and slowing growth of smartphone units have created excess inventory and suppliers have been forced to greatly reduce average selling prices in order to move parts. A DRAM ASP decline of 16% coupled with a forecast 3% decline in DRAM unit shipments is expected to result in the DRAM market declining 19% in 2016 (Figure 1), lowest among the 33 IC product categories IC Insights tracks in detail. This steep decline will be a drag on growth for the total memory market (-11%) and for the total IC market (-2%) in 2016.

Figure 1

Figure 1

Big swings in average selling price are not new to the DRAM market. Annual DRAM average selling price increases of 48% and 26% in 2013 and 2014 propelled the DRAM market to more than 30% growth each year. In fact, the DRAM market was the strongest growing IC product segment in each of those years (Figure 2). Then, marketshare grabs and excess inventory started the cycle of steep price cuts in the second half of 2015 and that continued through the first half of 2016.

Figure 2

Figure 2

Figure 3 plots changes in annual DRAM average selling prices starting in 2007.  Looking more like the profile of an alpine mountain range, DRAM ASP growth has taken several dramatic upward and downward turns since 2007, confirming the volatility of this IC market segment. When coupled with strength or weakness in DRAM unit shipments, bit volume demand, and the amount of capacity and capital spending dedicated to DRAM production each year, this market can turn quickly up or down.

Figure 3

Figure 3

On a positive note, DRAM ASPs strengthened in late 2Q16 and are forecast to continue growing through the balance of 2016 and into 2017.  The boost to DRAM ASP is expected to come from demand for enterprise (server) systems, which have been selling well due to the need to process “big data” (e.g., the Cloud and the Internet of Things).  Also, low-voltage DRAM continues to enjoy solid demand for use in mobile platforms, particularly smartphones.  Demand from new smartphone models is expected to help contribute to increasing DRAM ASPs through the end of this year and into 2017.

The upward DRAM ASP trend may be short lived, however, as two China-based companies, Sino King Technology in Hefei, China, and Fujian Jin Hua IC Company, plan to enter the DRAM marketplace beginning in late 2017 or early 2018.  It remains to be seen what devices and what technology the two new entrants will offer but their presence in the market could signal that another round of price declines is around the corner.

Further trends and analysis relating to DRAM and the total memory market through 2020 are covered in the 250 plus-page Mid-Year Update to the 2016 edition of The McClean Report.

The Semiconductor Industry Association (SIA), representing U.S. leadership in semiconductor manufacturing, design, and research, today announced worldwide sales of semiconductors reached $79.1 billion during the second quarter of 2016, an increase of 1.0 percent over the previous quarter and a decrease of 5.8 percent compared to the second quarter of 2015. Global sales for the month of June 2016 reached $26.4 billion, an uptick of 1.1 percent over last month’s total of $26.1 billion, but down 5.8 percent from the June 2015 total of $28.0 billion. Cumulatively, year-to-date sales during the first half of 2016 were 5.8 percent lower than they were at the same point in 2015. All monthly sales numbers are compiled by the World Semiconductor Trade Statistics (WSTS) organization and represent a three-month moving average.

“Global semiconductor sales increased slightly from Q1 to Q2 but remain behind the pace from last year, due largely to global economic uncertainty and sluggish demand,” said John Neuffer, president and CEO, Semiconductor Industry Association. “Sales into Japan and China have been a bright spot midway through 2016, and a modest rebound in sales is projected during the second half of the year.”

Regionally, sales increased compared to June 2015 in China (1.7 percent), but fell in Asia Pacific/All Other (-11.0 percent), the Americas (-10.8 percent), Europe (-5.5 percent), and Japan (-1.3 percent). Sales were up slightly compared to last month in the Americas (3.0 percent), China (2.2 percent) and Europe (1.7 percent), but down somewhat in Japan (-1.0 percent) and Asia Pacific/All Other (-0.6 percent).

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