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Growth Signs Spur Optimism At SEMICON Europa

Global semiconductor companies met in Grenoble, France for SEMICON Europa 25-27 October in a bid to shake off the doldrums that had stymied growth for nearly two years. While positive reports encouraged attendees, most companies are looking to Internet of Things (IoT) products to move the needle most in 2017.

As industry-leading companies, start-ups and every-size company in between met in Grenoble, France for SEMICON Europa there was no escaping an essential question: were recent growth indicators the start of a trend, or will it take the IoT to drive real growth in 2017 and beyond?

To take a reading of the mood across industry in 4Q 2016, one needed only visit a major conference in late October. Positive growth indicators materialized shortly before the event, but few companies reported seeing strong evidence so soon afterward despite the SEMI organization's recent positive announcements. A glimmer of good news in October was followed in November and December by analysts in overall agreement: the market is starting to improve.

Silicon Semiconductor technical editor Mark Andrews and publisher Jackie Cannon met with companies across the supply chain including EV Group (EVG) director of communications Clemens Schutte who said that his company had seen an increase in orders, and that new process tools announced earlier in 2016 were catching the attention of customers across the supply chain.

EVG had previously announced significant additions to its metrology and wafer bonding tool line-ups, including the EVG50 automated metrology system and the new ComBond Activation Module (CAM) designed to support room temperature bonding of sensitive materials. MEMS applications were recurring themes for EVG as was a wide range of IoT device and process tool solutions.

Edwards Vacuum launched its new Smart Thermal Management System (TMS) at SEMICON Europa. The system adds feedback control to accurately maintain gas temperature in vacuum pump fore lines and exhaust lines. Unheated lines can be clogged by condensed process materials and by-products. In addition to semiconductor/IoT product manufacturing, the system is designed to improve performance for manufacturers of flat panel displays and solar cells using chemical vapour deposition, epitaxy and etches with the potential for condensation. Alain Astier, President of IoT Planet, remarked that the growth industry is expecting from an expanding universe of connected devices is indeed occurring. But like any major force impacting industrial expansion, IoT is still largely in its embryonic stages, which is good news for those with products still in development, but not the avalanche of good tidings many would like to see capturing headlines. Nevertheless, a reordering of business-as-usual takes time since, ""¦we are talking about a major shift in the way people interact not only with one another, but the devices they use: the internet and the products that they use today that are not yet connected "“ this is a revolution in the making," he said.

Stephane Allaire, president of Objenious, remarked that while it is easy to think of IoT as a "˜product' the concept of connecting devices to one another through the internet to expand their usefulness, enhance control features and enable whole new industries goes beyond any product class, type or category that the industry has so far created.

"IoT isn't just a product "“ it's a revolution. It is also an ecosystem. It is many, many things beyond a sensor or a battery that lasts 10 years to power that sensor. It is also an ecosystem because we use the internet and the cloud and "˜Big Data'"¦ And if you don't think that this will be big, you will be killed in the market," he elaborated.

The role that Europe already plays and can play in the evolution of the IoT was repeated almost everywhere throughout the Grenoble conference, emphasizing that IoT represents a new era in semiconductor manufacturing. Exhibitors and attendees seemed to share the sentiment that as an evolving marketplace without scores of IoT incumbents, and given the role European companies and researchers are already playing in IoT development, manufacturing opportunities for Europe are significant, especially for those who take a chance and seek them now.

Marie Semeria, CEO of CEA-Leti, one of Europe's largest research organizations, stressed the need for groups such as hers to continue their initiatives to strengthen public-private partnerships that are leading to more companies entering the business, bringing new ideas that lead to new products as well as solving the vexing challenges of industry. In an interview, Semeria said she noted that Leti's vision to anticipate the needs of industry and to "˜sense' where new markets might be found has never been more critical.

"I believe the message is to think differently and to provide differentiation and value to our industry partners. My goal is to add value including competitive advantages with differentiated technologies. We did that with FD-SOI, which was very different from what was offered at the time when FinFET was emerging. FD-SOI is the right technology for low cost/low energy consumption devices which will see growth as IoT grows."

Semeria said that the fully depleted-silicon on insulator (FD-SOI) technology Leti originated can have a substantial impact as designers and manufacturers create more IoT products for existing and new markets, reshaping the way people interact with each other and their mobile devices. She also foresees a greater role for integrating key intellectual property (IP) at the device level by co-engineering products with software that increases a device's worth before it ever reaches production "“ an example of the "˜value-added' approach she mentioned earlier.

"We have to think about the hardware and software together, whether that is finding better ways to use the FD-SOI technology such as lowering energy consumption, and embedding the IP right inside the package. Security is especially a concern for IoT devices, which is why we moved forward to add more designers such as (those in) the INRIA center "“ it is compelling research for the design centers to develop the software close to the hardware. We now have a dedicated team working on IoT security both at the device level and at other points along the value chain. Consumers need to have confidence that the new IoT-enabled devices they may consider purchasing will benefit their lives and not pose a security risk."

"The key is to consider security from the device level all the way up to the cloud. We at Leti are good at technology and communications at the hardware level, also we need to make sure that our partners are ensured of security and the most advanced technology no matter what they are looking to manufacture."

"An important initiative for us is to continue to expand the global portfolio including a high degree of integration and interconnection; with more interconnects we can gain time and speed as well as a smaller size. When interconnects go up we gain in many ways"¦We can be a low cost solution like we are now with FD-SOI in the Global Foundries plant in Dresden (Germany). This is still in Europe as well as at Samsung (in Korea). This is not yet in China, and if we want Europe to maintain a competitive advantage in developing IoT devices and other products we need to think about the best way to develop these technologies. The key is research to develop the technology. We have the tools and the expertise. We just need to execute on the plan," she remarked.

From the perspective of major research organizations such as Leti to supply chain vendors, OEMs and contract manufacturers, they believe sizeable growth across the semiconductor industry will resume when consumers "˜get excited' about new products including next-generation IoT and mobile devices. As Semeria and other leaders remarked at SEMICON Europa, the IoT isn't merely a portfolio of new products, it is the universe of technologies, wireless interfaces, networks and applications that empower the concept of connectedness that has the power to revolutionize society. Even though 70 percent of the $10 billion (USD) in revenue from IoT this year is tied to industrial applications, more visible consumer products are entering the market all the time, and this will continue to increase. The recent rising consumer awareness of connected devices like Amazon's "˜Echo' and its "˜Alexa' interface "“ and growing purchases of such technology "“ are steps towards new levels of connectivity that will impact public perception just as earlier products created a whole new industry as evidenced by Apple's iPhone and Samsung's Galaxy product lines.

Days before SEMICON Europa, trade organizations and analysts presented data suggesting 2016 could end on a positive note, a far better result than earlier when market watchers expected something between backsliding and modest growth. By November multiple industry trackers forecast small increases this year, with 2017 expected to outpace it by a significant margin. International Business Strategies (IBS) was amongst those forecasting a fractional uptick for now, with growth as high as 4.6 percent in 2017. Almost everyone agreed that a surprising surge in US PC sales combined with replacement smartphone sales was driving 2016 numbers positive. What's in store for 2017 will depend on legacy market growth and excitement around newer smartphone models replacing Samsung's failed Galaxy Note 7 and the prospect of Apple having new tricks in its iPhone bag. The wild card is how quickly the semiconductor market feels IoT's heft "“ the "˜800 pound gorilla' that so many expect to do so much for semiconductor makers. If the IoT starts significantly capturing consumer imagination in 2017 the Champagne corks will start popping.

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