The Intel Foundry Ecosystem Explained

Exciting times for the semiconductor industry! Last week Intel announced a billion dollar fund to build a foundry ecosystem and today Intel announced they are acquiring foundry Tower Semiconductor for $5.6 billion dollars, WOW! Some people doubted Intel’s commitment to the foundry market this time. I think we can now put that to rest. Intel is in the foundry business, period.

First let’s talk about the billion dollar ecosystem investment:

How It Works: As a key part of its IDM 2.0 strategy, Intel recently established IFS to help meet the growing global demand for advanced semiconductor manufacturing. In addition to providing leading-edge packaging and process technology and committed capacity in the U.S. and Europe, IFS is positioned to offer the foundry industry’s broadest portfolio of differentiated IP, including all of the leading ISAs.

A robust ecosystem is critical to helping foundry customers bring their designs to life using IFS technologies. The new innovation fund was created to strengthen the ecosystem in three ways:

• Equity investments in disruptive startups.
• Strategic investments to accelerate partner scale-up.
• Ecosystem investments to develop disruptive capabilities supporting IFS customers.

Who’s Involved: The IFS Accelerator features innovative partner companies across each of the three pillars of the program:

• EDA Alliance: Ansys, Cadence, Siemens EDA, Synopsys
• IP Alliance: Alphawave, Analog Bits, Andes, Arm, Cadence, eMemory, M31, SiFive, Silicon Creations, Synopsys, Vidatronic
• Design Services Alliance: Capgemini, Tech Mahindra, Wipro

Richard  Wawrzyniak did a nice explanation of the RISC-V investment (Intel Embraces the RISC-V Ecosystem: Implications as the Other Shoe Drops) so let’s continue with the EDA, IP, and Design Services sections.

EDA is an easy one for Intel as they are the biggest consumer of EDA tools. In fact, Intel is one of Synopsys’ largest customers, if not THE largest. And since Synopsys is also the largest IP vendor this relationship is critical. So, EDA is important but not a big challenge since Intel is already tight with the EDA community.

IP is a similar situation for Intel. There are already relationships with the commercial IP vendors through the TSMC based business. Remember, Intel historically uses TSMC for 20% of their production soon to be increased to more than 50% with N3 so there is a lot of TSMC based commercial IP floating around Intel already. Opening that up to Intel specific processes should not be a hard thing to do and that is where the billion dollars is going, to get that IP silicon proven on Intel processes and packaged up for foundry customers. According to the IP ecosystem, they are already gearing up to port military grade IP to Intel processes.

The big weakness I saw in the announcement is the Design Services Partners. Design services plays an important role inside the foundry ecosystem. I had once suggested that Intel buy a big ASIC company to closely partner with like TSMC and GUC, UMC and Faraday, or SMIC and VeriSilicon.

Of course, now that Intel is buying Tower Semiconductor for $5.6B that disrupts the ecosystem quite a bit:

Tower’s expertise in specialty technologies, such as radio frequency (RF), power, silicon-germanium (SiGe) and industrial sensors, extensive IP and electronic design automation (EDA) partnerships, and established foundry footprint will provide broad coverage to both Intel and Tower’s customers globally. Tower serves high-growth markets such as mobile, automotive and power. Tower operates a geographically complementary foundry presence with facilities in the U.S. and Asia serving fabless companies as well as IDMs and offers more than 2 million wafer starts per year of capacity – including growth opportunities in Texas, Israel, Italy and Japan. Tower also brings a foundry-first customer approach with an industry-leading customer support portal and IP storefront, as well as design services and capabilities.

What isn’t mentioned is military embedded systems. Tower is perfectly positioned for US military aerospace and defense contracts and I can assure you that is part of the Intel strategy. Jazz Semiconductor, formerly Rockwell, is a key part of this transaction, More leverage for CHIPs Act money, absolutely.

Jazz Semiconductor Trusted Foundry (JSTF), a wholly owned subsidiary of Tower Semiconductor Newport Beach, Inc., was created and accredited as a Category 1A Trusted Supplier by the United States Department of Defense’s (DoD’s) Defense Microelectronics Activity (DMEA) as a manufacturer of semiconductors that may be used in trusted applications. In addition, as of October 2014, JSTF has been accredited with Category 1B.

JSTF joins a small list of companies accredited by the DoD Trusted Program, established to ensure the integrity of the people and processes used to deliver national security critical microelectronic components, and administered by the DoD’s Defense Microelectronics Activity (DMEA). JSTF is proud to join the DoD Trusted Program to enable trusted access to a broad range of on-shore technologies and manufacturing capabilities.

The Intel investor call is getting ready to start. I will add more thoughts in the comments section.

Also read:

Intel Discusses Scaling Innovations at IEDM

Intel Architecture Day – Part 1: CPUs

Intel Architecture Day – Part 2: GPUs, IPUs, XeSS, OpenAPI

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