Author Archives: Mike

About Mike

Mike Buetow is president of the Printed Circuit Engineering Association (pcea.net). He previously was editor-in-chief of Circuits Assembly magazine, the leading publication for electronics manufacturing, and PCD&F, the leading publication for printed circuit design and fabrication. He spent 21 years as vice president and editorial director of UP Media Group, for which he oversaw all editorial and production aspects. He has more than 30 years' experience in the electronics industry, including six years at IPC, an electronics trade association, at which he was a technical projects manager and communications director. He has also held editorial positions at SMT Magazine, community newspapers and in book publishing. He is a graduate of the University of Illinois. Follow Mike on Twitter: @mikebuetow

Would-Be Foxconn Beneficiaries: Always A Bridesmaid

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The University of Wisconsin this week became the latest would-be benefactor of Foxconn’s pretend largesse to acknowledge that it has been, in fact, jilted.

A UW-Madison response to a public records request by the Wisconsin State Journal on Monday shows the Taiwanese electronics company gave $700,000 in the first year of a five-year agreement and no money in the second or third year. The amount to date represents less than 1% of the original commitment.

“I am not at this point expecting to receive that gift,” Blank said in an interview with the State Journal editorial board last week. “It’d be nice. I think it’s unlikely.”

— UW Chancellor Rebecca Blank

UW should feel no embarrassment at falling for the Taiwanese ODM’s promises of riches — in this case, $100 million in grants. The list of brides left standing at the altar by Foxconn is long and global.

Perhaps one day, when Foxconn comes knocking, the prospective bride will demand the ring — and the cash — upfront.

Somehow, however, I tend to doubt it.

From Boards to Brews

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In case you were wondering whatever happened to IBM’s once sprawling campuses in Endicott, East Fishkill, and other western New York towns, where Big Blue made everything from semiconductors to laminates to circuit boards, the New York Times has the story.

Spoiler alert: Like so many other old mill buildings, breweries, among other businesses, are moving in.

All in on Altium?

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Autodesk’s bid — declined, so far — for Altium took me by surprise. In retrospect, it probably shouldn’t have.

As I’ve noted many times, I fully expect Altium to be acquired. It’s just I was looking more in the direction of Dassault and PTC, the big mechanical CAD (MCAD) players. I should kept Autodesk in my field of view, especially after it acquired Eagle five years ago. I think I was lulled to sleep, as that was a small acquisition and Autodesk hasn’t made much of a push since to burrow into the ECAD space.

The proposal was hefty, valuing Altium at $3.91 billion. That’s not much lower than Siemens paid for the considerably larger and more profitable Mentor Graphics in 2107. Yet Altium thinks it can do better.

It just might. Autodesk’s bid prices each Altium share at AU$38.50, a 41.5% premium over Altium’s closing price on Jun. 4 and a premium of over 47.4% to the one-month volume-weighted average price. Prior to the offering, however, Altium’s stock had peaked at a 52-week high of AU$39.34 in last October. So at $38.50, Autodesk was actually underbidding a bit.

An Autodesk-Altium merger wouldn’t change the face of the ECAD industry immediately. Altium would still run neck-and-neck with Zuken for third place in revenues behind Cadence and Mentor. But it would give Altium the backing of a industry leader in 3-D CAD, and accelerate the inevitable MCAD-ECAD merger.

New Semi Group Needs to Talk Bigger Goals than Just Subsidies

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“You never want a serious crisis to go to waste. And what I mean by that is an opportunity to do things that you think you could not do before.” ? Rahm Emanuel

Indeed.

In the wake of the latest components inventory crisis, the lobbyists are out in full-force trolling for subsidies for the semiconductor industry.

And if the usual suspects weren’t enough, many of the blue chip (no pun intended) companies that make up the Semiconductor Industry Association and SEMI this week launched yet another industry organization, the Semiconductors in America Coalition. the group supports the allocation of $50 billion by the US government (read: taxpayers) to fund advanced semiconductor manufacturing. The announcement came at almost the same time – coincidence? – IBM reported successful development of 2nm process using a 300mm wafer.

That prompted a longtime friend and industry observer to suggest, “rather than spending money directly, the US and state governments offer the same deal to the supply chain as a whole as do the South Korean, Chinese, and Taiwanese governments. A holistic response is needed. Maybe a carrot to keep 2nm tech onshore.

“We need to bring a number of critical technologies back; chips, packaging, HDI, transposers and even certain components,” he went on.

“Apple has been using black solder mask for decades now to prevent piracy and it has worked. Their keiritsu approach works. Keeping key technologies within the kimono, as the Japanese say, and bringing those key industrial components back, would help to reaffirm North American industrial security and protect our supply chain.”

I can see where he’s coming from, but Apple really doesn’t have the scale of the other communications and computing OEMs; it’s share of the worldwide smartphone market is about 15%, and it has only 8% of the PC market. It’s probably not the model to emulate in that regard. More interesting is its recent decision to go full bore with its own M1 processor, which is made by TMSC.

I know Samsung and TMSC are also working on (close to?) 2nm. I don’t think IBM alone has the scale anymore to be a difference-maker, which is where the other fabs need to step up. They all smell an opportunity, and it’s hard to blame them for trying to get their hands on “free” money.

What I haven’t seen is an overarching policy proposed by the various trade groups/lobbyists promoting onshore wafer production. It seems more piecemeal to me, with new associations stacked atop legacy ones, all promoting the same message (subsidies) but with no promise of tangible returns.

I’m not against government subsidies for critical tech – and semi is absolutely one of those – but it seems to me they should start with a goal and then fill in the rest (processes, funding, etc.).

Sans a clear objective, the game plan will not only be expensive and a hard sell, but doomed to break down.

US Semiconductor Independence Comes a Little Late for EI

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“Rebuilding the US packaging industry would not only insulate chip companies and their customers from political risk, it could also help them break free of the long cycles involved in creating new chips, said Tony Levi, a professor of electrical and computer engineering at the University of Southern California.”

Reading that, I can’t help but think of Endicott Interconnect Technology and what might have been.

It must have been 15 years ago when I toured EI, the one-time IBM campus where bare board fabrication, assembly and chip packaging all took place. So self-contained was the operation, in fact, they had their own laminate treater.

EI was where the HyperBGA and CoreEZ high-speed flip-chip BGA packages were invented, as well as custom laminates for semiconductor packages. The engineering talent was second to none. They really could do it all.

What they never mastered, however, was the right scale. Agreements to license their products went nowhere. The layout complicated process flow: I remember having to duck to avoid banging my head as I would my way through the partially subterranean assembly facility. Dwindling revenues coupled with the high cost of doing business in New York ultimately scuttled the company, and the assets were sold to TTM in 2019.

With today’s emphasis from President Biden on down on rebuilding the US semiconductor industry, however, one can’t help but wonder whether EI was the right idea, just 20 years ahead of its time.

The Labor Honeypot

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Plexus, annually among the highest-ranking performers in the CIRCUITS ASSEMBLY Top 50 EMS Companies list, yesterday announced a new plant to be built in Thailand.

In its press release, the company touted the facility as an example of “Plexus’ commitment to Environment, Social & Governance (ESG) best practices.” And on the surface, much of this sounds great: green building initiatives, an exterior green zone for employees, and other features.

But the Plexus Code of Conduct goes further than just green initiatives. There’s talk — lots of talk — about corporate and individual ethics, core values and leadership behaviors. And ESG criteria are more than green initiatives: the “social” component is tied to standards for managing relationships with employees, suppliers, customers, and the communities where a company operates.

From the Plexus website: plexus.com/en-us/corporate-social-responsibility

Plexus specifically cites its adherence to the Universal Declaration of Human Rights, a proclamation by the United Nations General Assembly in 1948, which in its preamble notes history’s uncomfortable past with free speech:

Whereas disregard and contempt for human rights have resulted in barbarous acts which have outraged the conscience of mankind, and the advent of a world in which human beings shall enjoy freedom of speech and belief and freedom from fear and want has been proclaimed as the highest aspiration of the common people

And commits its signers to the following:

Everyone has the right to freedom of thought, conscience and religion; this right includes freedom to change his religion or belief, and freedom, either alone or in community with others and in public or private, to manifest his religion or belief in teaching, practice, worship and observance.

– Universal Declaration of human rights, Article 18

And Thailand is complex. It routinely jails citizens, including minors, for speaking out. Defaming the monarchy is punishable by up to 15 years in prison per incident. God save the king, but don’t badmouth him.

This is going to sound like I’m picking on Plexus. In fact, this is a problem facing numerous multinationals. One thing they have in common is membership in an official sounding organization called the Responsible Business Alliance (RBA). Formerly the Electronics Industry Citizenship Coalition (EICC), RBA is a group of companies that “share a commitment to ensure working conditions in the electronics supply chain are safe, that workers are treated with respect and dignity, and that business operations are environmentally responsible.”

Fancy words aside, the RBA is a crock. The companies that make up its membership include Apple, Amazon, Foxconn, Pegatron, Wistron and other OEMs and ODMs that are routinely singled out by NGOs, in social media and the mainstream media for disregarding worker health and local labor laws. In my view, the RBA is used as a shield: listen to what we say, don’t look at what we do.

I can’t argue with Plexus’ decision to locate factories where the labor is skilled and generally cheap. But I can’t rationalize how Plexus’ lofty goals of good corporate citizenship fit with Thailand’s pattern of state-sponsored oppression.

Just as we thought the bloom was off the rose in China. Will the EMS industry trade one labor honeypot for another?

Passive Demand Anything But Passive

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The component distributor TTI has released its first quarter market report and the outlook is ominous: 28 passive electronic component types have increasing lead times, while 24 saw price increases. Tantalum molded chip cap lead times are now up to 32 weeks.

Lead times for most connectors remain stable, although prices are climbing. The exception is TE, whose lead times are climbing.

Memory supplies are also generally getting tighter.

With some component manufacturers now requesting 18 month forecasts, the risk for double-bookings is on the rise. Beware! Someone always gets stuck holding the bag of chips.

https://www.futureelectronics.com/resources/market-conditions-report/memory

‘We are Stronger by What Unites Us’: An Open Letter from PCEA and SMTA

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My name is Stephen V. Chavez CID+ and I serve as the President of the newly formed Printed Circuit Engineering Association (PCEA). PCEA is a trade association for professionals in the electronics industry. There are several other trade associations, some large or small, some old or new that currently exist. We seek to affiliate in a cooperative manner with each one. I have observed that we all attempt to serve the greater good in the electronics industry. Each group has evolved, grown and hopefully we all seek to coexist.

I know at the PCEA many individuals are involved and have historically been involved with IPC, SMT, IEEE, and many other associations. We have served and continue to serve in each other’s ranks. In particular I have the distinguished privilege to serve as an IPC-CID+ Master Instructor. I also serve as a volunteer on some of the IPC standard committees. I am honored for the privilege to serve in their ranks.

A recent column [Ed. note: Because the column was not in PCD&F/CIRCUITS ASSEMBLY, we are not linking to it here.] I read takes issue with the efforts of IPC in our industry, and while well-intended, I do not recognize the picture it paints. Among other things, the author suggests a lack of contact between IPC and the American educational system. In fact, IPC has a robust college outreach program across the US, and dedicated staff to support it. Keep in mind, the effects of the COVID-19 pandemic has slowed many good efforts to engage with engineers and future engineers worldwide, and this is no exception.

Moreover, in my opinion the best path to take is to volunteer our time – as we in the PCEA are doing – to educate our colleagues, the newer members of our industry, and the future
ones. Note the emphasis on the word “our.” IPC is a reflection of ourselves. Its staff, like
that of PCEA’s and many other associations and professional societies, comes from industry. We are all evolving and attempting to serve the industry at large in so many ways. It is a tribute to IPC that it has successfully navigated the changing industry so well over 60 years, and we all owe them a debt of gratitude and allegiance for so many of their great achievements. I once communicated a perspective about the IPC that bears repeating, “IPC is not a Them, rather, it is an Us!”

SMTA – Tanya Martin, Global Executive Director
SMTA has been fortunate to be serving the global electronics manufacturing and design
industry since 1984. We support professionals by facilitating access to national and international communities of experts, as well as accumulated research and training materials from those dedicated to advancing the industry. Some of our most important work is done within our local chapters (national and international) in connecting professionals for education, training, and fellowship. We have invested great resources into the college and university programs and support many SMTA student chapters around the US to be a bridge between industry and academia.

SMTA and PCEA both agree that IPC along with other trade organizations such as SMTA, IEEE, EIPC, others including the newly formed PCEA can coexist and collectively make this industry better. Each of us has the potential to serve the participants. Many of those participants are involved with several trade associations. We have seen IPC successfully reach into the community, academia, professional development, government advocacy, standards development, engineering, manufacturing, OEM business, contract manufacturing and the list can go on… The same thing can be said about the other trade associations. We believe we are all better served by our common welfare and the things that unite us are bigger than the things that divide us. We at the newly formed PCEA are ardent supporters of the IPC and their mission within the industry. We seek to affiliate and be proponents of their mission to serve the electronics industry. We encourage everyone to respect them not for their perfection but for the general overall benefit that our industry receives on so many fronts.

If faced with the question of whether to be givers or takers to the industry, we choose “givers.” Like all the trade associations, IPC is organic and adaptable, addressing the needs of those they serve the best they can. We are grateful and support their mission!

Stephen V. Chavez CID+
Chairman, PCEA
Collaborate, Inspire and Educate
Cell (602)369?3349
[email protected]
www.pce?a.org

The Nature of Disruption

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Just finished recording an hour-long (!) podcast with Judy Warner for Altium’s On-Track sessions. And while I don’t want to spoil any surprises, I will briefly touch on one of the topics we covered.

We got on the topic of disruptions. (I know, I know, it’s every keynote speaker’s favorite word. Sorry.)

In my view, ECAD software has to continue to get more intuitive and easier to use, especially for engineers who may only spend 10 or 20% of their time doing layout. If most of your time is spent using other tools, you won’t necessarily develop the hard-coded means to work the layout software. And no one wants to have to relearn the software each time they use it. So the tools must be more intuitive. And along the same lines, they need to be able to perform integrated functions with other platforms in their native environments. Users are most comfortable when operating in the environment they are familiar with.

To that end, I still think the company that breaks the ECAD industry will most likely come from outside the ECAD industry, if for the stunningly simplistic reason that engineers and their marketing colleagues in one industry are always looking for ways to expand into others.

Which is how it came to be that a maker of PCs (Apple) broke the recorded music industry and then broke phones. And a maker of batteries (Tesla) broke the automotive industry.

Going back aways, a software developer (Microsoft) broke computing, which was all mainframes and dummy terminals back in the day. (Now with app-based tablets and Chromebooks tethered to the cloud, we’ve come close to full circle.) And that same software developer broke video gaming, doing $5 billion in revenue from Xbox related sales last quarter alone and helping to spawn and massive market for online gaming.

My advice to Judy and her colleagues at Altium is to keep improving the design to manufacturing handoff — where so many manufacturability and quality defects take form — and to be wary of any company that comes up with a simpler and cheaper way to go from schematic to actual circuits, because while I don’t know who, how or when, I do know it’s inevitable.