ARM stole the headlines at Computex with its launch of a 55nm Internet of Things (IoT) subsystem but it was not the only player timing a bid around the show for a slice of the potentially huge Asian market. And there may be some interesting geopolitics going on in the background.
ARM’s lead partner on its IoT launch is TSMC, the world’s largest foundry and a tentpole of Taiwan’s high technology sector, and it further features ARM’s mbed OS and Cordio Bluetooth IP.
The rival announcement came from Shanghai-based design services company Brite Semiconductor, which is also targeting 55nm in collaboration with mainland foundry SMIC, and Bluetooth and DSP IP supplier CEVA. There are other similarities.
ARM’s IoT platform is Cortex-M based and leverages TSMC’s ultra low-power (ULP) and embedded flash technologies. The Brite rival is based around SMIC’s ULP and eFlash technologies. Also important to both offerings is a shared promise to speed and simplify IoT development and delivery in a sector packed with smaller players.
The global market will always welcome more competition, but an intriguing aspect of these announcement may prove to be the rivalry between Taiwan and China – and in particular China’s attitude to its burgeoning number of IoT start-ups using services from across the Strait. What might their future success (or otherwise) tell us about where the enablement dollars in the IoT will actually go?
Taiwan as an IoT test bed
Following ARM’s announcement, Ian Drew, the company’s chief marketing officer and executive vice-president of business development, specifically cited Taiwan’s attractions as a test-bed for ARM’s ambitions in the IoT.
The Cortex-M platform is expected to get most traction in the smart cities and smart homes segments, and the Taiwanese capital Taipei certainly fits the bill. It has a very technology-savvy population of 5.7 million people and is the world’s seventh most densely populated city. It already has an enviable wireless infrastructure and the government has been quick to adopt numerous smart-living systems.
In this context, partnering with a local giant like TSMC makes a lot of sense at both the local and global levels.
However, Taiwan’s investments in the IoT are dwarfed by China’s, as are those of every other country. The GSM Association has forecast that the Middle Kingdom will spend $600B on its efforts by 2020.
IoT development with strings attached
IoT start-ups are springing up in mainland China at an incredible, incalculable rate. Many are very small – across the IoT market globally, companies that are only three years-old are expected to account for 50% of sales with many of them being composed of tiny, highly application-specific teams. In that context, the Chinese entrants are often dependent on state or local government funding and incubator infrastructure.
Here, China sees the IoT as also a massive driver for its long-lagging foundry sector. It is not just the volume that matters but also the fact that the IoT does not require manufacturing capacity at the most advanced process nodes – nodes that China is still effectively blocked from using.
Both the ARM/TSMC and the Brite/SMIC offerings are for 55nm, and that is expected to one of two dominant IoT nodes, with the equally established and stable 40nm, in the near-term.
Further context here lies within China’s current five-year economic ‘guideline’, which expires at the end of this year. This includes a drive to reconfigure the local high technology economy “from made in China to created in China”, matching the country’s strengths in high technology manufacturing to new ones in innovation and generating intellectual property.
So, a Chinese company faced with a choice between similar IoT platforms may feel it should opt for the local flavor. These companies may even be encouraged to do so.
Foundries across the Strait
ARM can probably view this issue phlegmatically. Before this week’s announcement, it was already part of at least one mainland IoT platform at Wuhan-based XMC, albeit at 65nm today.
TSMC also may not be unduly concerned today. Its ULP technology is ahead of its mainland rivals – power consumption on the ARM 55nm platform will be less than one volt. But in the longer term it probably will cast a wary eye at how much business SMIC and other Chinese IoT platforms win as the sector now begins to accelerate.
For sure, one instance of platform competition is not going to recast the entire foundry industry, though it could be an interesting bellwether of things to come.