My thanks to Dr Dwight Decker, chairman of Conexant and the Global Semiconductor Alliance for this one. Here are the ten best reasons not to be engaged in the semiconductor industry:
1 Chip industry growth has slowed from the 20s of per cent in the mid-90s to single figures now
2 Design and product costs are escalating.
3. Technology treadmill turning as fast as ever
4. VC funding is down
5 The stringency of the requirements for operational excellence is going up
6 Hitting market windows is more critical
7 Chips are so complex that IP has to be bought in accounting fro 20-30 per cent of the total cost of a chip.
8 R&D costs as a percentage of sales are going up.
9. Foundries are aiming to spend less on capex to increase their profitability
10 Assembly and test houses are cutting back on capex to become more profitable.
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