ExtremeTech had a chance recently to sit down with Brian Halla, CEO of National Semiconductor to get an idea of how National is approaching the future. Since we conducted this interview, things have gotten dicey for the Silicon Valley chip company. The company announced that it was shedding its system-on-a-chip Geode business, and then late last week investor-activist Ralph Whitman announced that he wants two seats on the board.
Where is chip technology going: All the fab stuff is going to China. Intel and AMD will try to maintain the process control roadmap for CMOS, but its erroneous to think that this wont go to China too.
Since .5 Micron, the process technology roadmap has been dictated by the chip manufacturing equipment guys. The last major piece of equipment built in the US was when IBM microelectronics built a copper sputter.
Now its Applied Materials, Nikon and Canon who determine what everyones .13 micron process looks like. A big reason why Taiwan Semiconductor (TSMC) and other Taiwanese and Chinese foundry companies have been successful is because theres so much commonality that everyone uses. Its easy to move from one to the others fab.
The largest consumer of semiconductor equipment today is TSMC. Who is ASML (another major semiconductor equipment vendor) going to take its orders from? TSMC, thats who.
Now what do we know about Taiwan? Its virtually already unified with China. Over half of the fabs have moved to mainland China. TSMC will be moving to Mainland China. They are who AMAT and ASML listen to. TSMC will be in Bejing, and that means that the process roadmap for our industry will also be dictated out of Bejing.
So Chinas becoming a huge force in chip development? Every company needs a China strategy before its too late. Here are the three things they have to figure out:
- How do I take advantage of the explosive consumption that will happen in China. Its already a replacement market.
- How can I take advantage of the manufacturing opportunity in China?
- How do we deal with the China Brain Drain? They graduated more double Es (Electrical Engineers) than everywhere else in the world combined.
Were looking at China as a big opportunity.
So what will keep National competitive in a China dominated market? We are an analog company. Analog engineers are raised not born. All these guys train under gurus, the training goes on for 5 or 10 years. And all the best gurus are at National, Texas Instruments and companies like that.
Why is analog so important? In any cell-phone today, 3/4s of it is analog. Take the Sony Ericsson T66. Its done in four chips plus a power amplifier.. Three of those four are analog chips. Even with SPOT, analog has become a disproportionately large part of the circuits.
So if digital chips are going to China, what can Intel do? Intel wouldnt know how to build an analog circuit. They could always buy someone. But Intel is so focused on Pentiums, they dont have time for anything else. Plus an acquisition probably wouldnt work out. Analog companies and engineers like to be the hood ornament not the tail pipe.
How is it being a CEO these days? It is a bit of a stigma. My mom even called and said, "Are you embarrassed to be a CEO."