A group of processor suppliers banded together a couple of months ago to make it easier to licence each others? "system on a chip" technology so they would not have to reinvent the wheel.
System on a chip (SoC) technology is intended to comprise all the functions of a PC, including modem, Internet access, audio, video and graphics, on a single piece of silicon, half an inch square. The processors do not include memory, however.
On 10 October, Motorola, Toshiba, Siemens and Cadence Design Systems founded the Virtual Component Exchange (VCX). VCX is based in Scotland as a result of that country's petitioning to boost its Silicon Glen hi-tech region, but the organisation will also receive marketing and support services from Silicon Valley and Japan.
Andy Travers, VCX?s interim director, said: "The VCX will, with industry backing, provide a self-regulated structure designed to simplify and standardise the cross-licensing process, thereby enabling VC creators and users to focus on the design and manufacture of cutting-edge products rather than contracts and negotiations."
The organisation is also cooperating with other technical and standards bodies such as the growing Virtual Socket Interface Alliance (VSI). The aim of the VSI is to establish technical standards that will enable vendors to mix and match virtual components and reuse blocks of electronic circuit functions, often called intellectual property (IP).
Susan Cain, VSI's marketing director said members had recognised they did not have the means to design larger and larger Integrated Circuits ( ICs) for more complex electric systems. As a result, the group intends to define and develop open specifications for data format, test methodologies and interfaces.
Phase II of the system-on-a-chip On-Chip Bus Attributes specification is expected by the end of 1998.
Early players in the SoC market include National Semiconductor, LSI Logic, Motorola, Texas Instruments and SGS Thomson, but market leader Intel is conspicuous by its absence from this space. While it recently hired one of IBM's leading SoC designers, the company would not comment on what he would be working on.
After years of Silicon Valley talk, the SoC movement started to become real late last year when Cadence Design Systems and Toshiba designed the Toshiba TX19. This is a 32-bit processor with a RISC core and its compliance with other Virtual Socket Interface (VSI)-based virtual components meant that SoC chips could be built for the first time.
Jack Harding, Cadence?s president and chief executive, said: "System-on-a-chip is a revolutionary idea. Taking IP blocks with multiple functions and combining them, painlessly, to create an entirely new device opens up vast new horizons for electronics."
Texas Instruments (TI), a VCX member, intends to build systems-on-a-chip with digital signal processing (DSP) technology at its core. DSP processors are fast, single-purpose chips that can reduce the distortion of audio signals in cell phones, for example. TI?s offering will combine audio, video and graphics on a single piece of silicon.
"It's a very competitive market, but the potential payoffs are also very big. There's room for lots of different people," said Tammy Gray, TI?s marketing manager.
SGS-Thomson also hopes to compete effectively in this market and is signing up OEMs to help it get there. It has a deal with Nokia to include the chips in its cell phones, Seagate in its hard disk drives, Alcatel in its telecoms equipment and Thomson Multimedia in its TV set-top boxes.
Jean-Philippe Dauvin, SGS's chief economist, said: "To build systems-on-a-chip you need system know-how. The only way to get that is through long-term strategic alliances with system companies."
National Semiconductor, meanwhile, underwent a corporate restructuring to move into the SoC market, when Brian Halla, current chief executive, took over the reigns in 1996, following the departure of Gil Amelio to Apple.
National paid roughly $550 million for Cyrix, which is chasing Intel at the low-end of the PC microprocessor market.
Halla said: "National has assembled, through acquisition and internal development, all the pieces it needs to integrate a PC on a single chip. We have all the intellectual property building blocks and the methodology to stitch them together onto a square of silicon less than half-an-inch wide."
He continued: "We will drive the cost of personal computing below $500 and ultimately allow the PC to disappear behind the flat panel display or inside the radio on your car."
The firm?s first SoC for PCs is due to ship by mid-1999, and is expected to incorporate digital cell phone circuitry within three years.
But another chip maker, Synopsys, has taken the unusual step of setting up a venture capital fund to invest in SoC start-ups.
It has committed an initial $20 million to the fund, with an additional $20 million due to follow.
"The purpose of the fund is to help realise systems on silicon. Our charter as a company is to solve this problem, but we realise we can't do it all ourselves," said Bob Dahlberg, Synopsys?vice president of business development.
The first two beneficiaries are Synchronicity, a Boston-based provider of Web-based project management software and The Silicon Group, an Austin, Texas-based IC design-services firm.
Synopsys has taken minority stakes in each, but other areas of interest include intellectual property, electronic data automation (EDA) and design service providers.
Separately, Synopsys is also partnering with IBM to develop SoC technology applications in data processing, communications, and consumer electronics.
LSI Logic, on the other hand, is using the technology to develop a Casio digital camera that shoots seven exposures per second. This will increase to 30 in a year?s time.
Wilfred Corrigan, the firm?s chairman and chief executive said the company was building "systems-to-order-on-a-chip" for high volume applications and was also looking at putting multiple systems on a chip.
It displayed several prototypes of the technology at the last shareholders annual meeting, but also plans to add global positioning system functions and Internet access in future.
However, it is not all rosy in the SoC garden. Tension is mounting between the chip companies and system builders that have traditionally mixed and matched different chips to develop PCs.
Ronald Collett, president of management consulting firm, Collett International, pointed out: "The battle is over system-level functionality and system-level IP. System-level IP is often regarded as the king of all IP because it commands high profit margins. System companies have it, chip makers desperately need it."
He added that system companies, particularly those in the computer industry, but also increasingly those in the communications industry, are far more experienced than most traditional semiconductor companies when it comes to developing large, complex chips.
But, he continued, systems companies must recognise that the so-called "system-on-a-chip revolution" is about semiconductor companies transforming themselves into a new breed of quasi-systems company. If they do not, they face extinction.
However, there is no doubt in the industry that the move to SoC will happen and the evolution of the semiconductor will continue.
National's Halla summed it up: "First the PC goes on a chip. Next the PC becomes a plug-in behind the dashboard of your car, behind a flat-panel display in your kitchen or inside a set-top box. The PC disappears just the way electric motors are invisible in our lives. We use them all day long but we only think about the appliance, not the motor."
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