Q: Founded only three years ago, MHS Electronics has quickly established itself as a key player within the analog/mixed-signal foundry market. How has the company’s passionate commitment to its values and mission contributed to its growth and achievements in analog/mixed-signal?

A: While it is true that MHS is only three years old, our foundries in Swindon, UK and Nantes, France were founded in the 1950s and the 1970s, respectively. With such an outstanding heritage within major semiconductor groups, and proven expertise in complex analog/mixed-signal products, we have been able to capitalize on our customers’ challenging product development and industrialization programs.

Q: To continue this growth, does MHS plan to expand its foundry services in the near future, or will you focus on your core offerings?

A: Our strategy is to continue expanding our specialized foundry services through process technology enhancements in our current core technologies and through acquisitions. Our technology roadmap extends our processes in operating voltage and environmental robustness (e.g., higher operating temperatures). Concerning acquisitions, we are looking at facilities that will provide us with better geometries for our radio frequency (RF)/mixed-signal technologies and with 8-inch capacity. We will also continue to transfer customer-specific process technologies for second sourcing and obsolescence management.

Q: MHS Electronics established its business through the acquisition of foundries from Atmel in France and Zarlink in the UK. How did this acquisition strategy position and differentiate MHS Electronics in the worldwide foundry services market?

A: Our facilities in both the UK and France are similar in that they are specialist foundries, with each delivering high-performance analog technologies. The Nantes facility specializes in CMOS process technologies, while the Swindon facility specializes in bipolar process technologies. The available process technologies were broadly based on supporting high-performance applications for the military, space, aerospace, medical and RF telecommunications markets. We have broadened our market applications to support power management and industrial controls. Presently, MHS has a broad portfolio of patents and technology/manufacturing expertise that allows our customers to design best-in-class solutions for their end markets.

Q: Industry experts forecasted 2008 to be the year for analog. With so many second- and third-tier foundries focusing on the analog/mixed-signal space, there is obvious competition as well as plenty of capacity. These factors, coupled with the economic instability in the industry, suggest potential market consolidation. How will MHS position itself in light of this competitive consolidation, and how has MHS addressed this volatile global marketplace?

A: We are seeing consolidation in the market and expect to see more consolidation this year, not only between pure-play foundries, but between pure-play foundries and integrated device manufacturing (IDM)-based foundries. During these extremely difficult economic times, our strategy is to remain focused on delivering superior technology so customers can use our processes to remain competitive and win business in their respective markets. However, the lack of visibility in today’s markets has forced us to closely examine our cost base to ensure we can survive and prosper in the future. We have recently started to take the necessary steps to reduce costs across the business, which include cuts at both manufacturing sites.

Q: The analog/mixed-signal market poses challenges for foundries, including the task of developing a variety of cost-effective, complex process technologies. What internal and external resources must a vendor of analog/mixed-signal services possess to experience profitability?

A: It is much more difficult to enter an analog/mixed-signal market than a pure digital one. Best-in-class analog/mixed-signal process technologies result from decades of experience and expertise in semiconductor device physics, complex process integration, and product design and application. In addition to the necessary internal resource expertise, establishing close relationships with our customers, design house partners and electronic design automation (EDA) vendors is vital for success. Furthermore, creating strong research and development (R&D) programs with academic partners is very beneficial in paving the road for further innovation.

Q: In Q4 2008, MHS Electronics’ Swindon site successfully passed its audit for the ISO/TS 16949: 2002 standard certification – its third period of registration since February 2003. Although foundries can apply for and meet the rigorous requirements for TS certification, fabless companies have yet to demystify the value-added approach for meeting the certification’s requirements. What are the factors contributing to the inability of fabless companies to achieve TS certification? How can foundries help their fabless companies demonstrate their commitment to rigorous quality standards with the certification bodies?

A: Both the Nantes and Swindon manufacturing sites have successfully fulfilled the requirements of the most severe standards (Automotive ISO/TS 16949, Avionics EN9000 and Environment ISO 14001). One barrier to entry for fabless companies is the requirement to manufacture a product that is physically installed in a motor vehicle. Thus, fabless organizations cannot obtain a standalone certification, and would need to become an integral part of the supply chain by forming a strong partnership with a foundry.

An effective way for foundries to help their fabless partners achieve TS certification is for both parties to share the burdens associated with the requirements by contracting service and foundry agreements, and to mutually demonstrate a commitment to rigorous quality standards. To implement this innovative approach, flexibility from the registration body and a great deal of trust and efficient communication between the fabless company and the foundry is required. To demystify the value-added approach of the certification, one must understand that the ISO/TS standard is focused on the customer/supplier relationship, aiming to enhance customer satisfaction through continuous improvement, a zero-defect culture and mastery of the manufacturing process.

Q: To reduce the costs and risks of new IC designs, MHS Electronics provides foundry process design kits (PDKs) to its customers. To further this effort, in March 2004 GSA teamed up with industry leaders to develop the Mixed-Signal/RF PDK Checklist, which helps fabless companies secure a clear understanding of the source data, completeness and quality of a PDK before using it to design ICs. The MS/RF PDK Checklist Working Group is further improving the Checklist by adding a section that contains an overview of the portability of the PDK (i.e., database, Pcell language, callback language and layout transfer format). Have you adopted the Checklist? (If yes) How does this checklist help MHS and its customers? (If no) What needs to be improved to make this checklist robust enough for MHS to adopt the checklist and provide to its customers?

A: We have reviewed and adopted GSA’s Mixed-Signal/RF PDK Checklist and believe it is a common platform which can help initiate conversation with new customers. We continue to work with our customers and EDA suppliers to ensure we have the most up-to-date PDK support. Currently, we are looking at the provision of intellectual property (IP) in our CMOS PDKs, simplifying the design kit data and evaluating how customers use our design kits. We generally receive very positive feedback regarding our design kits, models and design manuals.

Q: Industry claims indicate serious challenges for the European semiconductor industry. Competition in Europe’s chip industry is lagging, signaling that greater innovation must occur. As a company that values technological innovation, what steps do you feel industry leaders must take to restore Europe’s competitive advantage on a worldwide scale and foster innovation in Europe?

A: From our perspective, we believe that it is not the ability, but the will of leaders in the industry and government that will help regain our status as a leading global provider of semiconductor and electronic technologies. By supporting semiconductor associations and improving the coordination of R&D programs to foster innovation, Europe’s competitive advantage could be restored. We agree with Semiconductor Equipment and Materials International’s (SEMI) recent whitepaper “Recommendations to the European Union and National Governments to Increase Europe’s Microelectronic Industry Competitiveness” that strong support to dedicated fabs, such as MHS, is necessary to create “more than Moore” innovative devices for new and emerging applications.

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