Author:Dink
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China may have around 400 design houses, but the major question should be, how competitive these design companies are. From our research we know that most of these design companies are much too small and have only very small technological and organizational capabilities to compete on a global scale, or even on a local one. The talk about a major shake-out in the Chinese IC-design industry is probably quite right.
The next question is whether wafer manufacturing capabilities are really essential for a dynamic development of IC design capabilities. As the vertical specialization moves on, I would doubt that.
The major argument for Indian IC design industry is twofold: FIRST, India has already major investments from multinationals like TI, STM and NXP. The design labs are working often on leading-edge products within very integrated projects, not only on IP or physical design issues. TI is probably the best example - the company is already more than 20 years in India and developed its operations from low-tech tools development to highly integrated operations. Through many spin-offs by former engineers from TI India something of a local analog/mixed-signal design ecosystem has already developed, with companies working on leading-edge products.
SECOND, major Indian service/outsourcing companies like Wipro or Tata have developed IC design service departments that have grown considerably in size. As these multinational companies have a long-standing tradition as service providers they have the organizational capabilities and the financial ressources to take a major position in the international division of labour, taking over increasingly leading-edge IC designs.
There is a major BUT in the Indian equation: as for the local companies, they are focused on design services which, as we all know, are not prone to high profit margins. As India lacks a local OEM electronics industry - there are no Indian Huaweis or Lenovos in place - the question of how much the Indian economy as a whole might profit from a big IC design service industry might have to be answered negatively in the future.
Peter Pawlicki
Institute for Social Research, Frankfurt am Main
http://www.ifs.uni-frankfurt.de/forschung/design_networks/index.htm |
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