Rewriting the Future Is India ready to compete in the global electronics ecosystem? Dr. Sandeep Muju Corporate Vice President Moser Baer Industry Associations Roundtable India Semiconductor Association (ISA) Vision Summit Hyderabad, February 5th-6th, 2007
Rewriting the Future Global Electronics Industry Profile in 2006 Applications Automotive, 6% Gov.Military, 8% Computer, 33% Examples of 2006 WW ProductionConsumer, 10% (Estimates in Unit) Mobile Phone 950M Set-Top Box 230MIndustrial, 15% PC 230M Color TV 160M Digital TV 25M Communications, 28% Total: $1200B est.
Rewriting the Future Global Market – Developments* Market Morphing Principle Market Segmentation Trend C C MOBILE MOBILITY use Computers C devices C C PORTABILITY use Consumer C C PORTABLE C C devices Communications STATIONAR STATIONARY use C C C Y devices 1990 1995 Storage Market Segments Video Computers MOBILITY Imaging use Consumer PORTABILITY Audio use Communication STATIONARY s Computers (IT) use • Stationary segment: mains powered, wired connectivity (examples: desktop, STB) • Portability segment: battery powered, wired/wireless connectivity (examples: notebook, game console) • Mobility segment: battery powered, wireless connectivity, wear-able (examples: cell phone, mobile terminals) *Web Feet Research
Rewriting the Future Mobility Memory – Evolution* x3 x3 x3 Storage Storage Storage Storage + 10% + 10% + 10% Work Memory Work Memory Work Memory Work Memory 1 Generation 1 Generation 1 Generation • WORK MEMORY vs. STORAGE – Capacity increase pace • WORK MEMORY – Approx. 10% p.a. x 2 by 2010 • STORAGE – Approx. X 3 p.a. x 2,000 by 2010 – Performance increase drivers • WORK MEMORY – CPU performance driven • STORAGE – Market / applications driven *Web Feet Research
Rewriting the Future Mobility Market – Functionality Evolution* Gen. “n” Gen. “n+1’ Gen. “n+2” Gen. “n+3” Gen. “n+4” Gen. “n+5” Gen. “n+6” Gen. “n+7” 400% Performance 300% + 50% Functionality + 30% 200% + 10% Price + 0% Power 100% – 2% Form factor 02 03 04 05 06 07 08 • Functionality evolution trend: Generation life span: – Approx. 9 months (trend – shorter over time) Functionality: – Needs to increase approx. 30% p.a. Performance: – Needs to improve approx. 50% p.a. Power consumption: – Needs to stay flat Form factor: – Cannot decrease much further (physiologics) Price: – Allowed to increase by max. 10% p.a. – (price/function has to decrease approx. 15% p.a.) *Web Feet Research – (cost/function has to decrease at a higher pace)
Rewriting the Future Indian Electronic Industry (2004-05) Total $11.6 BnIndian Production of Electronics has been very low by international standards. But thegrowth rates are high and the increased presence of EMS companies should stimulate localmanufacturing by encouraging the development of an “Electronics Eco-System” Components, $1.80 Consumer Strategic Electronics, $3.65 Electronics, $0.70 Industrial & Communication Others, $2.65 & Broadcasting Computer, $2 Equip, $1.00
Rewriting the Future Semiconductor/Electronics Market Patterns 45 40 35 30 US$ in millions 25 Americas Japan 20 Europe 15 Asia Pacific 10 5 0 1983 2003 Consumption has shifted towards Asia-Pacific. By 2010, Asia-Pacific is expected to be ~50% of World Market!
Rewriting the Future Global Electronics Hardware Production: India is 1/20th of China in global share! Country GDP 2004-05 Electronic Share of Share of Global ($Bn) Production GDP (%) Production (%) USA 11750.0 634.0 5.4 44.3 Japan 4900.0 220.0 4.5 15.3 Germany 2100.0 174.0 8.3 12.1 China 1650.0 210.0 12.7 14.6 South Korea 681.0 103.0 15.1 7.2 Taiwan 328.0 51.0 15.5 3.5 Israel 117.0 27.6 23.6 1.9 India 665.0 11.2 1.7 0.7 Sources: Instat website; ELCINA research
Rewriting the Future Essentials of an “Electronics/Semi-con Eco-System” Industry friendly regulatory framework Ready & capable Original Design/IP Indian Scenario Human Capital Capability Semicon policy on the anvil India emerging as the global Electronics/ design houseStandards Semi-con Semicon India beginning to be recognizedDevelopment Eco-System Fab as a manufacturing center for electronics Large investments in Backend and Front end to further encourage Component Test, Mark & development of Mfg – SME’s Packaging Semicon/Electronics Ecosystem Original (ATMP) product Mfg (OEMs)
National level Coordinated Effort required Rewriting the Future*Source: Plan-B
Rewriting the Future Need a Full-Lifecycle Ecosystem Approach for IndiaStrategic Market Technology Concept Chip/Productneeds understanding & Product Concept Prototyping Pilot/Initial Commercial scale Post sales Detailed& development Development (IP) & Testing Manufacturing manufacturing Service & FLCM Design $155B $58B Original Design for global market Technology Alliances Front End & Back End Manufacturing Capability in Original Design SME support structure Development $12B Made-in-India “Seal of Quality” – core Backend manufacturing product/IP in “high” quality/reliability Local market growth > global growth Indigenous IP development markets developed and made in India Backend “captive” Design hubs Entry into “high” quality/ Indian companies developing and reliability markets (Defense, leading industry standards bodies. Little/No manufacturing Aero-space, Medical) – both Lack of sufficient policy incentives design and manufacturing Further leverage core technology strengths in HW/SW design development; Develop core product and manufacturing strengths into full value chain participation; Create a place at the Global Standards development table.