Authored By:

Nesara S R

&

Abhishek Singh

Through this article, we aim to shed light on the intricacies of the semiconductor landscape and offer our take on where significant value-creation opportunities may arise in this space in the coming years.

To cater to the needs of all the different personas of the potential readers i.e. those that are completely new to the topic and would need a primer to those that have already spent some time reading about the category and would like to focus more on the nuances, we have structured the in a way that mirrors the journey of the research process we undertook:

  1. First, we embark on understanding the jargon and background of the semiconductor industry — if we are part of the audience at the Olympics arena, we need to know the different games played by who the key players.
  2. Second, we explore the tailwinds in this industry, focusing on two key perspectives: technological advancements and geopolitical developments (after all Olympics is about a bunch of nations fiercely vying for the top spots on the podium).
  3. Lastly, we examine the implications of these tailwinds and see what the next big things in this space could look like.

Semiconductor 101: Understanding the jargons and what do semiconductors actually do?

A chip or an Integrated Circuit (IC), as often used interchangeably, can be compared to a plate that brings together a variety of electronic ingredients, including resistors, transistors, sensors, diodes, and more, these components on the chip come together to create a unique integrated offering, tailored for a specific application (camera sensing, processing, memory etc). This chip acts as the base, holding everything together and serving it up for practical use in electronic devices. Chips are created on the surface of a silicon (or any semiconductor material) wafer, that undergoes a series of processes:

  1. oxidation to build an insulation layer that blocks current leakages,
  2. photolithography i.e. designing the chip onto the wafer, etching to carve out the unnecessary materials,
  3. deposition and ion implantation to add insulation and conducting characteristics layer by layer on the wafer,
  4. metal wiring to add a conductive layer on the top of the wafer and finally the wafer is cut into small chips.
  5. Finally, the chips are bonded to the PCB board, moulded into the desired shape and finally packaged to protect them and make them usable.

Packaging involves enclosing the IC in a protective casing, usually made of plastic or ceramic. This casing provides physical protection and helps to connect the IC to the external world through pins or other connectors.

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Source: Knowledge, Hitachi

Now every device itself might be made of a buffet of chips, each serving its own purpose while communicating with each other to make the device work the way it’s supposed to. Take a PC for instance, it carries a chip for processing, memory, audio, network, power management etc.