Over the past five years, the semiconductor industry has faced a number of complex challenges. These include increased development costs, eroded ASPs, market saturation and heightened, yet unsustainable M&A activity.
As 2018 begins, the semiconductor industry continues to seek a return to stability and organic growth within the parameters of a new business paradigm that is both viable and collaborative. Within this context, semiconductor companies are acknowledging the potential of new markets and downstream revenue opportunities as they explore a more comprehensive “silicon to services” model that spans the data center to the mobile edge.
This includes end-to-end IoT security solutions and PaaS-based services such as in-field feature configuration, advanced analytics, predictive maintenance alerts, self-learning algorithms and intelligent, proactive interaction with customers. In addition to services, the concept of open-source hardware and building silicon from disaggregated, pre-verified chiplets is beginning to gain traction as companies move to slash costs and reduce time-to-market for heterogeneous designs.
Specific strategies to unlocking the full potential of semiconductors will undoubtedly vary, which is why it is important for us to explore a future in which the industry, along with various research organizations and government offices, plays an open and collaborative role in helping to sustainably monetize both silicon and services.