Author Topic: CNBC: NXP and Freescale Announce $40 Billion Merger  (Read 25486 times)

0 Members and 1 Guest are viewing this topic.

Offline dannyf

  • Super Contributor
  • ***
  • Posts: 8221
  • Country: 00
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #25 on: March 02, 2015, 06:44:15 pm »
Quote
they made money with designs.

I'm sure that's the case. However, for the larger guys, the chips are the delivery vehicle for those value-add designs - ie. without selling those chips, they couldn't have sold their designs.

That's in sharp contrast to the small "fab-less" design houses who will design modules for others, or to license their chips for others to use, either in another chip or in their own designs. They don't typically sell into end users.

The bigger guys usually are not fab-less, and usually don't license designs to others - they market their own chips. This makes sense given their existing design base and their foot print into the end users.
================================
https://dannyelectronics.wordpress.com/
 

Offline Nauris

  • Regular Contributor
  • *
  • Posts: 188
  • Country: fi
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #26 on: March 02, 2015, 07:18:48 pm »
You bet more consolidation is coming. i left the semiconductor industry 6 months ago. The writing is on the wall. All the 'old boys' are hurting like hell. No investment , the new technologies are super expensive to implement and they get their lunch eaten by megafabs like TSMC and UMC and Chartered that have the technologies.

The time of the traditional design-fab semicon house if over. Nimble design houses can spin a design much faster than the big lumbering companies.

...

The only traditional players ( in the sense of being fab+design) are the niche players like Analog devices , Linear Tech. They don't have to deal with second-source , nor are they doing second-source.
Exactly, but on the other hand there are plenty of niche players. Things like wifi chips and ARM processors are one thing but there is much more to semiconductor business than that. Special processes is the key here and companies like Infineon, AMS, Bosch, Osram and ABB are doing quite well.

Then there are also some companies who can sell products made with older processes. For example look at Microchip they are certainly not doing badly. Thought in this case the "selling" part may be more important than the "making chips" part.

Quote
Look at the others. How much money can  you really still make of an LM324 if there are at least 5 companies making that thing. Why do you even keep that in your fab...
Well at least there is no fabless company designing LM324 and getting them made at TSMC, I suppose...

Then there is also the usual clausule from fabless chipmaker website:
Quote
During downturns in the semiconductor economic cycle, reduction in overall demand for semiconductor products could
financially stress certain of the company’s subcontractors. If
the financial resources of such subcontractors are stressed,
the company may experience future product shortages,
quality assurance problems, increased manufacturing costs
or other supply chain disruptions.
During upturns in the semiconductor cycle, it is not always
possible to respond adequately to unexpected increases in
customer demand due to capacity constraints. The company
may be unable to obtain adequate foundry, assembly or test
capacity from third-party subcontractors to meet customers’
delivery requirements even if the company adequately forecasts customer demand.
Quote from: Kjelt 
IC design is their core business the production could easily be outsourced. NXP earns a lot of money on patents like I2C that probably expired by now but the point is that they made money with designs.
For Freescale that is the case but NXP is more into jellybean parts - if you need BC847 NXP will sell you one.
« Last Edit: March 02, 2015, 07:33:43 pm by Nauris »
 

Offline nctnico

  • Super Contributor
  • ***
  • Posts: 28493
  • Country: nl
    • NCT Developments
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #27 on: March 02, 2015, 08:11:36 pm »
NXP's has many ARM microcontrollers and these work very well. I wouldn't be surprised if the Freescale Kinetis series gets dropped in the end.
There are small lies, big lies and then there is what is on the screen of your oscilloscope.
 

Offline Marco

  • Super Contributor
  • ***
  • Posts: 7083
  • Country: nl
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #28 on: March 02, 2015, 08:18:11 pm »
- the big semicon companies have outdated fabs, or fabs with some specialty technologies. if they can't monetize in the specialty techs their fabs are worthless. They cannot compete against the far east. they are two or three generations behind. Only the true big boys (Intel , Samsung , Toshiba )  can still do that. All the rest is obsolete tech.

ST is still hanging in there, 28nm is not obsolete (for logic any way, that's what Toshiba is at too). If they don't get some significant EU support I don't know if they'll be able to make the (glacial) transition to multi-patterning though (or maybe EUV ... hah).
 

Offline dannyf

  • Super Contributor
  • ***
  • Posts: 8221
  • Country: 00
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #29 on: March 02, 2015, 08:40:28 pm »
Quote
if the Freescale Kinetis series gets dropped in the end.

The Freescale chips are infinitely better than anything NXP has to offer. Not to mention software + field support.

If anything, I would bank on the opposite.
================================
https://dannyelectronics.wordpress.com/
 

Offline nctnico

  • Super Contributor
  • ***
  • Posts: 28493
  • Country: nl
    • NCT Developments
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #30 on: March 02, 2015, 08:56:54 pm »
Quote
if the Freescale Kinetis series gets dropped in the end.

The Freescale chips are infinitely better than anything NXP has to offer. Not to mention software + field support.
Yeah right :palm: NXP has been in the ARM business for about a decade longer than Freescale! It seems Freescale started to make the Kinetis range in 2010 in a me-too attempt to grab a bit of the ARM market because selling their pre-historic architectures is obviously not going to be a future proof strategy. The limited range of the supported cores by Freescale is a big sign on the wall.
There are small lies, big lies and then there is what is on the screen of your oscilloscope.
 

Offline Kjelt

  • Super Contributor
  • ***
  • Posts: 6590
  • Country: nl
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #31 on: March 02, 2015, 09:14:37 pm »
At the news this evening they said Freescale was interesting to NXP mainly for its automotive products.
 

Offline photon

  • Regular Contributor
  • *
  • Posts: 234
  • Country: us
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #32 on: March 02, 2015, 09:17:57 pm »
Today most of the R&D value and cost of a product is in the software. If your software is portable to a different platform then the product is basically future proof.
That is correct, software is currently a labor cost. But, if the Industrial Revolution has taught us anything, it's that labor can be replaced by machines at lesser cost. Until that happens for software, big advantage to India and China with their large, educated labor pool.
« Last Edit: March 02, 2015, 09:44:55 pm by photon »
 

Offline free_electron

  • Super Contributor
  • ***
  • Posts: 8550
  • Country: us
    • SiliconValleyGarage
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #33 on: March 03, 2015, 07:37:11 am »

the third alternative would be selling the fab , but nobody wants em as they are outdated.
I'll give 'em a few quid for teardowns.... ;D

They may give you money to take em ! 
Dirty secret number 2:

IBM offloaded their semiconductor fabs last october... to GlobalFoundries.
IBM PAID , yes PAID, you read that right : PAID !!! ,  1.5 billion dollar so Globalfoundries would take them !
Basically they offloaded the fabs and paid enough money so Globalfoundries could upgrade them to do processes the market wants.

The thing exploded lat week when the investors got wind of it ( IBM wrote it off as a 4.7 Billion $ charge. Split between value of the fabs and the money to take em )

Globalfoundries was after the technology patents , the fabs themselves, as they are are virtually worthless as they are outdated.

That pot is boiling over right now...

http://www.theregister.co.uk/2015/03/03/ibm_sued_for_talking_up_chip_business_it_couldnt_give_away/

And it ain't the only one.  The whole industry is going to come crashing down. I predict at least two or three more of these mergers.
« Last Edit: March 03, 2015, 07:41:36 am by free_electron »
Professional Electron Wrangler.
Any comments, or points of view expressed, are my own and not endorsed , induced or compensated by my employer(s).
 

Offline free_electron

  • Super Contributor
  • ***
  • Posts: 8550
  • Country: us
    • SiliconValleyGarage
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #34 on: March 03, 2015, 07:39:20 am »

That said I think the biggest problem for the whole industry are the low profit margins on all products, not only the end products
it is. i gave the example of the 1 square millimeter diode.

The race to the bottom is over. They have found it.
And now they are all standing there looking around where the exit hole is... Hint : it's above them , yet they still believe it is between their buttocks...
« Last Edit: March 03, 2015, 07:43:46 am by free_electron »
Professional Electron Wrangler.
Any comments, or points of view expressed, are my own and not endorsed , induced or compensated by my employer(s).
 

Offline dannyf

  • Super Contributor
  • ***
  • Posts: 8221
  • Country: 00
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #35 on: March 03, 2015, 02:14:03 pm »
Quote
Freescale was interesting to NXP mainly for its automotive products.

Yeah. Freescale and Renesas absolutely dominate that market. Infineon to a less extent.
================================
https://dannyelectronics.wordpress.com/
 

Offline zapta

  • Super Contributor
  • ***
  • Posts: 6314
  • Country: 00
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #36 on: March 03, 2015, 03:29:27 pm »
That is correct, software is currently a labor cost. But, if the Industrial Revolution has taught us anything, it's that labor can be replaced by machines at lesser cost. Until that happens for software, big advantage to India and China with their large, educated labor pool.

The cost of manufacturing software is virtually zero and it's already very automated.
 

Offline photon

  • Regular Contributor
  • *
  • Posts: 234
  • Country: us
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #37 on: March 03, 2015, 07:34:44 pm »
That is correct, software is currently a labor cost. But, if the Industrial Revolution has taught us anything, it's that labor can be replaced by machines at lesser cost. Until that happens for software, big advantage to India and China with their large, educated labor pool.
The cost of manufacturing software is virtually zero and it's already very automated.
Yes, the beauty of a software only company is that the end product is just a file of binary digits. The capital costs are only computers which are plentiful and inexpensive. However, that statements masks the true costs of software. It is very, very difficult to make such a file of just the right binary digits. So, to meet time to market, companies end up hiring lots of people mostly to verify and quality check the code written by the programmers. If you look at these labor costs they are high. Yes, software production is highly automated, but there is significant economic pressure to automate it more.
 

Offline coppice

  • Super Contributor
  • ***
  • Posts: 10125
  • Country: gb
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #38 on: March 04, 2015, 05:56:59 am »
The bigger guys usually are not fab-less, and usually don't license designs to others - they market their own chips.
Most fabless semiconductor companies market their own chips. If you look at who has risen to become big in the last few years, they are fabless companies. Qualcomm has become huge, and never made any of its silicon in house. nVidia and others aren't small, either. On the other hand many semiconductor companies with fabs, like Freescale, have shrunk considerably - 20 years ago only Intel was bigger than Motorola Semiconductors, as it was then. Most semiconductor companies with fabs now have their finest geometry parts fabricated by a foundry. For better or worse, they currently put most of their fresh investment into silicon design, not new state of the art fabs.
 

Offline free_electron

  • Super Contributor
  • ***
  • Posts: 8550
  • Country: us
    • SiliconValleyGarage
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #39 on: March 16, 2015, 05:56:28 pm »
Here's the next one : Cypress just announced they will merge with Spansion in a 5 Billion dollar merger...

so far we got
- ibm sold off ( gave away ) all their fabs to Chartered
- NXP merges with freescale
- Cypress merges with Spansion.

i predict two more ...
Professional Electron Wrangler.
Any comments, or points of view expressed, are my own and not endorsed , induced or compensated by my employer(s).
 

Offline JohnnyBerg

  • Frequent Contributor
  • **
  • Posts: 474
  • Country: de
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #40 on: March 16, 2015, 06:01:26 pm »
@free_electron: obviously being a insider in the chip business, how do you see the future?
Will prices of common stuff more erode?
Is there over capacity, and what will that do with prices?
 

Online ataradov

  • Super Contributor
  • ***
  • Posts: 11930
  • Country: us
    • Personal site
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #41 on: March 16, 2015, 06:50:30 pm »
i predict two more ...
The trick is to predict companies, not counts :)
Alex
 

Offline free_electron

  • Super Contributor
  • ***
  • Posts: 8550
  • Country: us
    • SiliconValleyGarage
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #42 on: October 15, 2015, 03:46:52 pm »
AD and Maxim ... 

and since i'm at it :

Fairchild with Infineon or On Semi ...


DUCK !
« Last Edit: October 15, 2015, 03:49:27 pm by free_electron »
Professional Electron Wrangler.
Any comments, or points of view expressed, are my own and not endorsed , induced or compensated by my employer(s).
 

Offline Richard Crowley

  • Super Contributor
  • ***
  • Posts: 4321
  • Country: us
  • KJ7YLK
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #43 on: October 15, 2015, 04:18:11 pm »
- the big semicon companies have outdated fabs, or fabs with some specialty technologies.
Over on an audio forum (GearSlutz) there is general moaning about a bunch of specialty products from TI that are being discontinued. A few with "replacements" of various suitability, but more of them with no replacement, from TI or anyone else.  The reason given is that TI is shutting down a 6-inch fab. I was rather surprised that there were still 6 inch fabs still running.  My employer shut down our 6-inch development fab 20 years ago.

https://www.gearslutz.com/board/geekslutz-forum/1035492-lme49710-lme49720-end-life.html
 

Offline free_electron

  • Super Contributor
  • ***
  • Posts: 8550
  • Country: us
    • SiliconValleyGarage
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #44 on: October 15, 2015, 04:30:40 pm »
oh yes, there's plenty of 6 inch stuff still running. most old school analog stuff that has been in production for 15+ years is still ran there.
the equipment has no residual value and is written off. spare parts are cheap. processes are mature and dialed in. those things are basically made at near zero cost. it is more costly to redesign the silicon and port it to new technologies. These products are so low cost they could never recuperate the porting costs.

The semiconductor business is going through a massive merger wave because it is untenable. a 5 million transistor chip sized 1mmx1mm costs as much as a 1n4007 which is also 1mmx1mm. just the development cost is a million times larger.

After the consolidaion wave i predict a lot of 'old product' will get the axe. simply because there will be overlap in production lines and they will shut down the bottom half of products. : take a look at what we now make after merging and chop of anything that makes less than X amount.

TI started with axing a bunch of old school NatSemi stuff. the rest will follow. after all , do we really need 7314 different opamps ? if we got a few good ones we're set.
« Last Edit: October 15, 2015, 04:35:02 pm by free_electron »
Professional Electron Wrangler.
Any comments, or points of view expressed, are my own and not endorsed , induced or compensated by my employer(s).
 

Offline kfnight

  • Regular Contributor
  • *
  • Posts: 71
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #45 on: October 15, 2015, 06:05:30 pm »
AD and Maxim ... 

and since i'm at it :

Fairchild with Infineon or On Semi ...


DUCK !

The story...

http://www.eetimes.com/document.asp?doc_id=1328023&
 

Offline zapta

  • Super Contributor
  • ***
  • Posts: 6314
  • Country: 00
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #46 on: October 15, 2015, 06:47:29 pm »
oh yes, there's plenty of 6 inch stuff still running. most old school analog stuff that has been in production for 15+ years is still ran there.


I used to write real-time software for those machines. The buzzword at the time was 'clusters' and one of the protocols was called SECS.  That's all I remember.
 

Offline Richard Crowley

  • Super Contributor
  • ***
  • Posts: 4321
  • Country: us
  • KJ7YLK
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #47 on: October 15, 2015, 07:57:08 pm »
SECS = SEMI Equipment Communication Standard - the protocol for communicating with fab tools.
SEMI = Semiconductor Equipment & Materials Institute

Presumably, "cluster" referred to groups of identical machines (like diffusion furnace tubes) grouped together for control purposes.

We now have AMHS (Automated Material Handling System) for moving boxes ("FOUPS") of wafers from one machine to the next on an automatic routing system.  Working towards a "lights-out" factory some day that won't require technicians to implement routine movement of product.
 

Offline zapta

  • Super Contributor
  • ***
  • Posts: 6314
  • Country: 00
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #48 on: October 15, 2015, 08:40:28 pm »
We now have AMHS (Automated Material Handling System) for moving boxes ("FOUPS") of wafers from one machine to the next on an automatic routing system.

I presume the software used fancy internet technology these days. SECS was originally a serial wire RPC protocol (so the term RPC) was not used and then we used OSI and then IP as transports.

Mechanic was very clever with special consideration to avoid friction between parts.
 

Offline free_electron

  • Super Contributor
  • ***
  • Posts: 8550
  • Country: us
    • SiliconValleyGarage
Re: CNBC: NXP and Freescale Announce $40 Billion Merger
« Reply #49 on: October 15, 2015, 08:57:16 pm »
SECS ... i remember that one.
i once made controllers for the wet etch line in our fab. i implemented SECS so we could hook em up to the VAX. We had a VAX cluster running the fab tracking software ( called COMETS) . you would type in the lot number on the wet etch controller and it woudl request from the VAX if the lot was supposed to be there, what recipe was supposed to be run and then do a move-in and move-out . Based on an 80528 cpu with membrane keypad an 2x24 char lcd display

those were the days ... 1991
Professional Electron Wrangler.
Any comments, or points of view expressed, are my own and not endorsed , induced or compensated by my employer(s).
 


Share me

Digg  Facebook  SlashDot  Delicious  Technorati  Twitter  Google  Yahoo
Smf