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EE|Times EUROPE 39

OPINION | CHIP MANUFACTURING

Seeing Moore’s Law

with 2020 Vision: Less

Is Now Moore

By Syed Alam

For more than five decades, companies have relied on technological
advancements from Moore’s Law to drive manufacturing profitabil-
ity. It was simple, yet brilliant, and it worked. Computers steadily
became smaller and more powerful as transistors on integrated advanced nodes — and whether there is a
circuits became more efficient. Semiconductor companies reaped the market opportunity on which to capitalize.
rewards because their chips, when manufactured on more advanced Semiconductor companies should also
technology nodes, actually cost less. make sure they are generating as much value
Now let’s fast-forward to 2020 and examine whether this same as they can out of their existing investments
principle still holds true. The market dynamics have changed in older nodes. Many of these older nodes are
substantially over the course of 50 years, prompting concerns that doubling the number of tran- so established that they still have many years
sistors every one to two years might not be the right approach anymore. of life left to offer growth and profitability.
Instead of jumping to the next node because
LET’S DO THE MATH that is what semiconductor companies always
As the industry has transitioned to newer nodes, design costs have grown exponentially. To put did, they need to step back and see if custom-
that in perspective, the annual design costs for 65-nm chips were well below US$50 million back ers are even asking for it or will need it in the
in 2016. However, today, the design cost for a 5-nm device ranges from US$210 million to near future.
1
US$680 million, and for a 3-nm device the cost ranges from US$500 million to US$1.5 billion. 2 In summary, the end of Moore’s Law
That is a 3,000% increase as we go from 65 nm to 3 nm. With such skyrocketing costs, it now doesn’t mean that semiconductor compa-
makes “Moore” sense for semiconductor companies nies will innovate any less. In fact, they may
Companies have relied to realign their long-term goals to identify additional innovate more by doing less. This may not

on technological opportunities for older, more economical technologies. always mean an automatic jump to the new-
est, most advanced process node available.
While moving to advanced nodes may deliver growth in
advancements from certain sectors, it will not necessarily deliver profit. Instead, companies will look to new doors for
This current situation is in stark contrast to what
innovation that they may not have thought of
Moore’s Law for decades semiconductor companies have been used to. In the previously. The industry is going to be just as
to drive manufacturing past, they could justify high initial design investments exciting, just in a different way than what was
because the cost of designing and manufacturing newer
originally defined by Moore’s Law. ■
profitability. Does this nodes came down over time as yield and production REFERENCES
quality ramped up. Each successive generation of tech-
principle hold true nology took advantage of lower manufacturing costs 1 “Technology Quarterly: After Moore’s Law.”
today? than the previous generation. 3 The Economist, March 12, 2016. economist.com/
However, because nodes in the 28-nm to 14-nm
technology-quarterly/2016-03-12/after-moores-law
range are already so densely packed, it’s much harder 2 Mark LaPedus, “5 nm Vs. 3 nm.” Semiconduc-
and more complex to reduce the critical dimensions of transistor components any further. tor Engineering, June 24, 2019. semiengineering.
Creating the next generation of ultra-dense chips requires more manufacturing cycle time, addi- com/5nm-vs-3nm/
tional manufacturing steps, and additional headcount. In addition, there has been significant 3 “Moore...or Less?”Accenture, 2017. accenture.com/_
capital investment required through various stages in semiconductor history: transitioning from acnmedia/pdf-61/accenture-moore-less-pov.pdf
200-mm to 300-mm wafers, automating material-handling systems, and upgrading equipment, 4 “Latest Thinking: Moore...or Less?” Accenture,
particularly in photolithography. 2020. accenture.com/us-en/insight-manufactur-
Today, there is no guarantee that the rewards associated with advanced chip development will ing-sourcing-strategy-competitiveness
outweigh the costs. Semiconductor companies must think carefully about where — and whether 5 “Moore...or Less?” Accenture, 2017. accenture.com/_
4
— to invest in advanced chip production. 5 acnmedia/pdf-61/accenture-moore-less-pov.pdf
IMAGE: SHUTTERSTOCK Clearly, semiconductor companies will continue to leverage their vast expertise to innovate and and consulting strategy at Accenture. As the
Syed Alam is managing director for strategy
IMPLICATIONS FOR 2020 AND BEYOND
drive new technological capabilities for a very long time. However, the decades-old mandate to
global lead for Accenture’s semiconductor
practice, he advises companies in the
double wafer capacity no longer carries the advantages it once did. As a result, chip companies
semiconductor, electronics, and high-tech
need to pursue opportunities that are aligned to a viable business strategy as well as to their
industries on operations transformation and
growth and profitability objectives. That means they need to make smart choices with their R&D
wherein they really think about the costs, benefits, and requirements of moving to the more
merger integration.
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