Clusters: Connecting the Semiconductor Value Chain

Clusters: Connecting the Semiconductor Value Chain

By Vincent Guerre, Trainee, Institutional Affairs, SEMI Europe

At the occasion of their 20th anniversary, SEMI Europe and JEMI France organized a unique event on 25-26 June in Grenoble, France: “Clusters, A Chance for the European Semiconductor Ecosystem”.

High-level panelists addressed the theme of clusters from several angles: Politics, R&D, Education and Industry.

Clusters are a key contributor to Europe’s success in the field of semiconductors. But what is a cluster? All clusters aim to integrate education, research and industry to strengthen competitiveness, but what are the differences between the main European clusters? How can clusters cooperate among themselves for innovation and competitiveness?

Integrating Education, Research and Industry to Create Innovation

Clusters are strong sources of innovation for the industry. By connecting education, research and manufacturing, they create synergies in the whole semiconductor ecosystem, from silicon technology to industrial applications.

The “Silicon Saxony” cluster in Dresden, for example, connects the entire semiconductor value chain and creates the highest level of attractiveness for international suppliers. Indeed, Silicon Saxony is a combination of lighthouse companies (Infineon, AMD, etc.…) with leading edge R&D (for example, the Fraunhofer research institutes). In Grenoble as well, the Minalogic cluster connects world-class companies (Soitec, ST Microelectronics), innovative SMEs, research institutes (CEA/Leti), universities and engineering schools.

Clusters are built on an integrated model: they enable network connections between SMEs and big companies, and between R&D and manufacturing. Developing these synergies strengthens the industry’s competitiveness and international visibility. Clusters multiply the power of the semiconductor value chain.

Clustering is vital for the semiconductor industry, which has to deal with quick innovation processes. Research has to be quickly transformed into innovation, and innovation into products. In a cluster, the fab is the lab— and the lab is the fab! Moreover, start-ups can only develop through partnership and big companies need a strong ecosystem around them.

Clusters are obviously a key issue for industrial policies. Developing world-class clusters requires strong political involvement. For example, the French “pôles de compétitivité” policy aims at linking together education, research and industry on a local geographical scale. Thus, the national “Nano 2012” funding program and local authorities in the Grenoble area strongly support the development of the Minalogic cluster.

Clusters in Europe: Common Points and Differences

Clusters are the driving force behind innovation, but what is the definitive definition of what a cluster is?

The Silicon Saxony and Minalogic clusters gather R&D centers, universities and industrial companies on a small geographical scale, where very close synergies can develop. However, the “Eindhoven – Leuven – Aachen triangle” is not focused on a single city but is based on trans-border cooperation between the IMEC research institute in Belgium and companies in the Netherlands and Germany. The ME2C cluster in Austria is also settled on a large 9,000 km2 geographical area.

More and more, the definition of clusters has moved away from a local and vertical integration approach to a global and horizontal partnering. Clusters now promote niche differentiation in a global market which is nothing but a collection of niches.

In a nutshell, a cluster is essentially a networking area which connects the entire semiconductor ecosystem, from research and education to manufacturing. Usually a cluster is led by one or several world-class manufacturers (STMicroelectronics and Soitec in Grenoble, Infineon and AMD in Dresden) and a research institute (Leti, Fraunhofer, IMEC), who put in motion a wide SME ecosystem.

Cluster Cooperation: Strengthening Europe’s Competitiveness

In the current technology race, single clusters can no longer handle a full coverage of all technologies and applications without external partners. Semiconductors technologies will probably reach their economical limits before their physical limits, especially in “More Moore” applications.

Competition in the semiconductor industry does not take place within Europe, but between regions. If Europe wants to remain competitive, it needs to combine its competencies.

The biggest European clusters have developed close cooperation to create synergies among themselves. For example, CSEM, Leti, VTT and Fraunhofer created “Heterogeneous Technology Alliance” (HTA). HTA aims at sharing specialized and complementary skills. It develops joint R&D projects and exchanges researchers and students. Even if each partner of the HTA remains independent, this cooperation offers a “one-stop shop” for the European industry.

European policymakers have to understand that Europe’s competitiveness in the semiconductor industry strongly relies on clusters. Europe does not lack clusters, but it lacks world-class leading clusters which can compete in the global economy. Europe really needs to concentrate its strengths on few large clusters which will cooperate between themselves on a pan-European basis!

Presentations from the SEMI Cluster event are available upon request from Carlos Lee at SEMI: clee@semi.org. For more information on SEMI Europe, please visit www.semi.org/europe and for more information on JEMI, visit www.jemi-france.org.

A few presentation slides are below:

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July 8, 2009