The key to transforming India into an ESDM manufacturing hub is to build an ecosystem that encourages entrepreneurs to create products. But that is fraught with challenges.

The “Make in India” mission is well on its way,  taking small but sure steps towards transforming India into an ESDM manufacturing hub. Of  critical importance is to build an ecosystem that encourages  entrepreneurs to create products. The challenge for an entrepreneur in electronics lies in not just building products but building products which can be commercialized and scaled up. The product may not necessarily be physical; it can be a  design tool or a blueprint for making a physical product, which should culminate in an the Intellectual Property (IP). In the ESDM space, the product can be the recipe to make a complete semiconductor chip or parts of the chip,  the  code fed into the semiconductor fab to fabricate the chip.

Why create IP?

The semiconductor design services is well established  in India. There are many companies operating in this space. They  generate revenue by helping MNCs create their  IPs. Not owning  IP entails long-term risks. Timing  is a very crucial element in the highly competitive semiconductor chip business, and hence chip makers look for ready solutions for blocks of  chip design where they don't have the resource or  expertise.

Pitfalls of IP creation

Creating IP  sounds like a very exciting business.

It is a tough game where any shortfall in performance viz-a-viz its promise/the expectations, is not only  unacceptable but is associated with   risks of huge losses. An IP company not only has to build a product, but it also needs to get it designed into a SoC. The SoC has to get designed into a system and the system has to achieve volume production.  We have seen instances of an entire chip  failing,  which explains  the phenomena of risk aversion in IP creation and adoption. Semiconductor IP needs to be fully aligned  to integrate into an industry’s constantly evolving hardware IP and software ecosystems. In Semiconductor  business, for instance,  VLSI designers need  EDA tools and test instruments, which are pretty expensive.

Miniaturization is the buzzword currently in the semiconductor IP space  and with advances in fab technologies, chipmakers are able to produce complex chips in shorter durations.

Advantage India

India is poised at a unique vantage point since the amount of outsourcing of IP functions is steadily increasing over the last few years. One reason for this is today’s system-on-chips have approximately 50 million instances, particularly in high-end applications processors, which are at the heart of today’s tablets and smartphones. The time-to-market pressure is intense and they require substantial innovation to manage  power. The solution thus is to use third-party IP for common functions such as USB, PCI Express and DDR. The continued drive for integration combined with aggressive schedules will require more and more outsourcing of IP, growing the market by almost 50% over the next few years.

The Way Forward

How do we meet this demand? How do we ensure that our new-gen engineers are geared toward IP creation and entrepreneurship? Here is where a strong and effective collaboration between the academia and industry comes into play.  The current curricula needs to undergo a sea change to become industry relevant, and this requires a major collaboration with  the industry. In addition, we need to evangelize  fresh graduates to become entrepreneurs and take risks. There must be incubation centres in college campuses where the students are  exposed to the latest research and development  happening in the field of ESDM.

The IP of tomorrow will be nothing like the IP of today. There will be a fundamental shift in methodology, architecture and the way we go about designing IP. IP vendors will need to be on the leading edge of technology as well as on the leading edge of integration, including software integration, to continue to provide value addition to the semiconductor industry.

Can we do it?

Yes, we most certainly can!

We only require a change in the  mind-set towards innovation and manufacturing and capitalise on the opportunities currently available.
There could’t be a better time to make a mark on the IP front and be a global player.
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The Writer is President, India Electronics and Semiconductor Association, IESA