MediaTek Goes Back to ASIC

　　BARCELONA — MediaTek is going back into the ASIC business.

　　In a one-on-one interview with EE Times at the Mobile World Congress, Joe Chen, president of MediaTek, told us that the Taiwan consumer chip giant has big plans to provide “premier ASIC design services” to system vendors in consumer, communication and computing markets.

　　“MediaTek has been known as an ASSP company for a long time,” said Chen, “but we now see growth opportunities by becoming an ASIC company.”

　　But hang on. Didn’t most chip companies ditch the ASIC business model in favor of a “platform-based” ASSP business? Unless you know up front that your ASIC customer’s product will sweep the consumers in certain market segment off their feet, it’s hard to justify the cost of ASIC designs.

　　Chen acknowledged, “Yes, true, over the last 20 years, the ASIC market has shrunk.”  But he quickly added, “We think the industry has also changed a lot over time.”

　　Consider, for example, Apple or Samsung in the smartphone business. Both have succeeded with their internally-designed proprietary chip solutions that differentiate their end products, Chen said.

　　Other large system vendors, too, are looking for “unique” solutions of their own, he said. However, as Chen pointed out, many system companies have either lost — or have not kept up — their internal ASIC expertise.

　　Sizable ASIC business

　　Around 2015, MediaTek began noticing changes in the air, as big customers began to demand unique solutions for their systems. In addition to ASICs that MediaTek developed for game consoles for Sony and Microsoft, Chen said, “By 2017, we’ve reached a milestone by winning a sizeable ASIC business in the consumer space.”

　　In 2018, MediaTek is poised to expand its ASIC business further by wooing customers in the communication segment. Chen, however, is neither naming the names of his ASIC customers nor disclosing specific product categories for which the company is designing ASICs.

　　In recent years, the global electronics market has gone through substantial transformations. First, as Chen explained, big wins have been limited to a handful of system companies, who have won by developing their own captive solutions. Second, a host of M&A activities in recent years among global semiconductor companies has decreased the number of chip suppliers. The merged companies are bigger, but are not necessarily growing by creating new business models.

　　MediaTek is among a few survivors in the global chip industry with a plan for growing more organically, including its stated goal of moving back into the ASIC service business.

　　Asked who offer ASIC services these days, Chen said that there are companies such as Faraday Technology and GUC, both based in Taiwan, offering SoC design services.

　　Chen hopes to come into the market by delivering much differentiated ASIC services. “We will go far beyond ‘place and route’ provided by Faraday or GUC,” he said.

　　As Chen sees the outlook, MediaTek has two factors going for its ASIC ambitions. “First, we have a broad-range IP portfolio… cutting-edge IPs in everything from communications, computing and connectivity to multimedia, other peripherals and RF,” Chen noted.

　　Second, “In ASIC business, your customers need to trust you,” he added. “For a big ASIC solution, you need a partner who has good reputation.” Chen believes that MediaTek has earned that reputation.

　　MediaTek has a team of ASIC designers separate from the company’s ASSP product development teams. ASIC business requires separate culture and methodologies, Chen explained.