New Power – And the Semiconductor context

In the article, “Understanding New Power” in HBR Dec 2014 issue, the authors Jeremy Heimans and Henry Timms talk about the shifting of power in the world. While the old power is held by few (and jealously guarded once gained), is closed, inaccessible and leader driven, the new power is made by many, open, participatory and peer driven. It is most powerful when it surges and the goal with new power is to channel it rather than hoard. For businesses to navigate in the coming years, they will need to understand this shift and adapt accordingly.

There is an interesting participation scale in the article which depicts power in terms of people’s participation – new power gains its force from people’s growing capacity and desire to go far beyond passive consumption of ideas and goods. It includes 6 levels – Consuming, Sharing, Shaping, Funding, Producing and Co-owning at the zenith.


Contextualizing this scale with the semiconductor space…..

The semiconductor industry has typically been on the consumption scale – which is towards the old power model. Fabless/IDMs companies design and fabs/IDMs produce the chips which are consumed by the end customer who has little or no hand in the design/manufacturing cycle. Also the chip industry is not so visible to the end customer.

Share – People sharing reviews of technical features of the products with chips e.g. processor speed in computing devices, resolution and clarity in displays, power and form factors in mobile computing devices etc. Typically done through various online forums.

Shape – This is where people participate in the designing of the product. No IP, chip or tools are shaped directly by consumer. Influence yes, but shaped no. However, skewing the context a bit and taking the case of a company as a consumer, a classic example here is the ASIC (Application Specific Integrated Circuit). The customer designs (various levels of handoff are involved – Architecture, RTL, Gate, Layout, COT) and the fab manufactures. However the majority of the chips sold remained Standard Products or Application Specific Standard Products (ASSPs).

Going by the NikeiD sharing example in which people design their own shoes (like adding colour fades to your shoes’ uppers, mid soles, customizable prints, tractions, widths etc.), one of the semiconductor analogy is the platform ASICs where client companies customize with various available layers, interconnects and IPs. However the vital difference here is that while in the shoes’ example, the consumer designs to customize his unique shoe, in the platform ASIC case, the client company uses the platform as a faster (and cheaper) mode to implement his design. It wasn’t really an increased participation in the process. However the Google modular cellular phone project Ara could be one.

Funding – No. Again putting another perspective I would extend the above ASIC example to funding too. By putting in the NRE (Nonrecurring Expenses), the ASIC customer is putting his money where his mouth is. Though it should be kept in mind that ASICs make/made economic sense only for high volumes and is/was usually favoured by only by the big guys with deep pockets and strong industry and market foresight. Crowdfunding platforms though have yet to see any big chip/Semiconductor IP funding

Produce – Participants here go beyond supporting or sharing others’ efforts and contribute their own. While consumers putting in their own chips may not be practical, we do see some examples in the services industry. Consumers making YouTube clips of gadgets/chip teardowns, sharing of short videos/tutorials explaining various semiconductor technical concepts are some examples here. Another example is an online marketplace that can match needs with supplies like Elance which is an online staffing platform. An example of a posting here could be a vendor looking for someone who can design a chip for some particular specs. While earlier these freelancing postings were mostly for programming or IT skillsets, off late one can come across a few postings catering to the semiconductor space.

Co-ownership – A good example for me here is Arduino; the open sourced electronics platform based on easy to use hardware and software and intended for anyone making interactive projects is another example fostering increased participation.

The IoT space offers a great opportunity for increased participation. Let me take the case of wearables and Intel specifically. Intel’s Curie, a new button sized computer for smart clothes is due to be out later this year.  It includes a Bluetooth radio as well as the company’s Quark line of low power chips. With Curie, people can deliver wearables in a range of forms and sizes – “Rings, bags, bracelets, pendants and yes, even the buttons on our jackets”, as mentioned by Intel’s CEO Brian Krzanich in his CES 2015 keynote. Some of the fabless companies are also providing their own proprietary development platforms (like LinkIt from MediaTek) pushing to get people design wearable and other IoT applications around them.

Contests/competitions have been a traditional way used by semiconductor companies to encourage young talent to their industry. Here too we can see the trend moving from traditional academic design competitions towards ones contributing to real chip designs/application e.g. Nixie, the wearable selfie drone was a winner in a wearable computing contest sponsored by Intel.

The power shift from “old” to “new” power is happening across all sectors. We in the semiconductor industry who have long been the enabler of technologies need also to actively align our mind set and biz models towards this in order to be better equipped in addressing the challenges ushered in by the new evolving trends.

As usual, am keen to hear your opinions on how the semiconductor industry can better leverage the trends in the coming years.


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