As semiconductor companies increasingly go fab-lite and fabless, the answer to their being able to deliver value to customers is their software, it was said at IEF2007 this morning.
“The value-added for the semiconductor industry has got greater as semiconductor companies have moved closer to customers,” said Chris Turner, a founder of Acorn Computer and Virata, and now business development manager at Cambridge Consultants.
“The chip is defining the application,” added Turner, “customers expect to have the definition of the product more or less delivered on a plate by the semiconductor manufacturer.”
This means that the software is the main competitive differentiator. “More and more chips are differentiated by the software that runs on them. The software defines the customer experience.”
The problem for big semiconductor companies is that so much of the innovative software thinking comes out of universities, entrepreneurs and engineers working at home away from the day job.
“Software projects often emerge from universities, entrepreneurs and academics,” said Turner, “the challenge for the large semiconductor companies and integrated device manufacturers (IDMs) is how to partake in this process.”
For entrepreneurs, Turner advised: “Getting the chip out is only a quarter of the battle, it’s finding customers, getting design wins, showing customers how to apply the chips which is important before you can get orders. And we see it’s often decided by availability of software, it’s often those companies with fully empowered software which get the design wins.”