Inderscience Publishers

Value chain restructuring and R&D portfolio management: the effects of system-on-chip integration on the semiconductor and electronics industries

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The integration onto a single "system-on-chip" (SoC) of functions that previously were performed by different computer chips on a system board (e.g. memory, system processing and application-specific logic) is a major technology theme in the semiconductor industry at present. This paper examines the effects of SoC integration on business models and R&D management strategy in the semiconductor and electronics industries. It will show that SoC integration is closely connected with restructuring in the value chain, including the shift from vertically integrated to narrower business models, the redistribution of relative value among the various segments of the chain and the appearance of new business models (e.g. foundry services and design 'IP' providers). In addition to involving larger and more diverse development teams, SoC integration calls on technology managers to adopt portfolio-based R&D management focus and to monitor closely the entire value chain in order to keep up with rapidly changing customer demands and opportunities.

Keywords: value chain, semiconductor industry, disaggregation, vertically integrated, design flow, intellectual property, R&, D portfolio, system-on-chip

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