October - 2011 issue > Technology

By Ash Patel

Overview – The semiconductor design services industry is a growing field, due to rising costs and shortage of engineers in countries, where IC companies are located. According to Garnter, the number of outsourced chip design stats, grew by 21.4 percent in 2010; compared to a decline of 9 percent in 2009, and a rise of 6.5 percent in 2008. The chip design services revenue, increased by 34 percent in 2010.

Chip design companies, are getting comfortable working, with service providers; resulting in complete projects to be outsourced, instead of just individual blocks. For supporting the current and future needs of their customers, the design service providers need to focus on building an ecosystem.

Ecosystem – The capital investment needed to start a design service company may restrict the growth of the company. If the company creates an ecosystem with vertical partners, it can grow faster and adapt better to changing market needs. The figure below shows the various components of a semiconductor design services ecosystem.

Talent Source – Engineering talent is scarce and especially well-trained engineers. Every service company should recognize and understand that, engineers are their key assets. Business growth will be proportional to the number of engineers they can hire and retain.

For a company to succeed, it needs to have access to students from good schools, and to do so it should build strong relationships with the school management.

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