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Friday, 08 October 2010 08:30

Real men still need fabs

Written by Nick Farell
y_wafer

We just have flabs here
Michael LeGoff, CEO at Plessey Semiconductors has hit out at the idea that chip companies do not need fabs. Writing in Electronics Weekly he quoted former AMD CEO Jerry Sanders as saying “Only real men have fabs”.

LeGoff said that since Sanders said his quote more businesses were emailing their chip designs to a foundry in Asia and get their chips back a couple of months later. The problem is that with everyone using the same process technology it is impossible to make your product appear different.

His outfit is making money by providing market opportunities for being able to provide products that are not standard. LeGoff said that Plessey Semiconductors built its reputation on having cutting edge technology.

To do that you have to be able to walk into your own fab and tweak a process to suit a customer need or develop something special like our radiation hard processes for military and aerospace applications. There is a bonus that you do not have to wait for slots in a foundry halfway round the world but can rush through and have chips exactly when you want them.

LeGoff said it was rubbish that the UK cannot compete in electronics manufacturing with the low labour costs in Asia. He said that labour only accounts for 20 per cent of his total costs of manufacture.

Chipmakers need to dare to be different, keep innovating to stay ahead of the game, and “real men still have fabs."

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+2 #1 Reavenk 2010-10-08 15:54
I'm lost on the quote. What's a "real" man, and was he referencing this because he likes the quote or because he was poking at AMD handing off their fabbing to the Global Foundries spin-off?

Maybe he meant just the most efficient companies in the world deserve to be profitable off owning a fab?
 
 
+9 #2 BernardP 2010-10-08 16:28
Of course, Jerry Sanders was right. It was a huge loss for AMD to divest itself from its fabs. But they had to choice: it was that or bankruptcy.
 
 
+2 #3 Sodomy 2010-10-08 18:33
Quoting BernardP:
Of course, Jerry Sanders was right. It was a huge loss for AMD to divest itself from its fabs. But they had to choice: it was that or bankruptcy.


well at lest they have Dubai making a profit for them now. Lets just hope they don't decide to sell off their remaining stake
 
 
+11 #4 Bl0bb3r 2010-10-08 18:34
It wouldn't have come to bankruptcy in AMD's case, just a really hard downsizing. But still, this all wouldn't have happened if major OEMs were led by real men with balls and released the EUC/FCC dogs on intel the first time they tried to blackmail.

Real men also have guts and brains not to get cornered and fight out of shitty situations.
 
 
0 #5 redisnidma 2010-10-08 22:08
Quote:
LeGoff said that since Sanders said his quote more businesses were emailing their chip designs to a foundry in Asia and get their chips back a couple of months later. The problem is that with everyone using the same process technology it is impossible to make your product appear different.

This is a lie. GloFo will be supplying SOI+HKMG only to AMD, and this is what I call their advantage.
 
 
+2 #6 Bl0bb3r 2010-10-08 22:34
Quoting redisnidma:
This is a lie. GloFo will be supplying SOI+HKMG only to AMD, and this is what I call their advantage.



Is anyone else needing SOI+HKMG? Nope!

That process is only on the expensive 32nm High Performance node, which by the price it has, not many beside AMD will use. Also, that process isn't available in Asia, only in Dresden, Germany.

The plant in Asia uses the old processes, which are pretty much made the same as anywhere else, probably different tools and libs, though.
 
 
+1 #7 nECrO 2010-10-09 07:23
@Bl0bb3r

My knee jerk reaction to your statement about balls was "Hell Yeah"! but in reality using ones balls to stand up to a company like Intel would only lead most of those companies to even thinner profit margins and in some cases like Dell, no profit at all. Dell and others depended on Intel's bribes... err incentives.. to stay profitable. So while it's nice to have balls and stand up to the bully, it's not always possible.
 
 
+2 #8 Bl0bb3r 2010-10-09 12:49
That's why I said they need to alert the authorities about it. Intel may be big and bad... but EUC and FCC can throw fines at them all day long.

And from what Demerjian reported, and the source site which I forgot what it was called, the execs all made verbal deals with Intel, except some of them write internal mails to their boards about the issue, but not even one of them though to ask some of their competition, and I don't believe for a second that they don't stay in touch with each-other, about the worrisome threats intel was "laying down" on the diner table. They just caved in... intel said fetch and they went after the "stick". Good bhoooy... such a good bhoy.
 
 
+1 #9 Bl0bb3r 2010-10-09 12:52
My first reaction would have been either to call some execs from a rival company or to wait and see the offering of the said rival company before contacting them about the threat intel made. If the rivals had the same deals as always, I could suspect that intel made threats against multiple companies, but if there would have been more offerings from AMD as expected, then something would be odd, as in my company would be targeted but not others.

The next move would be to make an agreement between the larger suppliers, harassed or not, to "protest" against bulling, threatening and blackmailing of any kind from intel.
 
 
+1 #10 Bl0bb3r 2010-10-09 12:58
While Demerjian said that in said scenario the problem would be the client, lets say one would be really pissed that he can't get the intel hardware requested and started threatening to go to a competitor, in a common case, where all parts agreed to stand up against intel, that said client would pretty much find itself out of options since not his supplier nor its rivals would serve him... where do you think the fingers would then be pointed at? One guess and a hint: it starts with i.

And intel would just as much suffer if they would be unreasonable since wafers ovens can't just be turned off and the started again. Turn them off for fear of overstocking and lots of batches would be ruined. Expensive mistake.
 

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