Tuesday, April 2, 2013

Critical success factors for MEMS commercialization

MEMS still has a long way to go to meet the challenges of commercialization! Critical success factors include efficient process transfer from breadboard to production. There is a need to pay attention to customers' needs. More resources need to be adopted from the semiconductor industry, said Roger Grace, president, Roger Grace Associates.

There is a need to create significant awareness as to the unique solution benefits of MEMS based system solutions. Firms need to better understand customer/market needs. There is a need to establish defensible product differentiation.

Emerging opportunities include single MEMS based system solutions, especially in analytical instruments, double magnetic MEMS, triple point-of-care bio, energy harvesting/storage, etc. There are barriers to commercialization of MEMS. Until recently, it is plagued by lack of high-volume apps. There is lack of well-defined direction from roadmaps, industry standards and associations. Packaging and testing costs are typically at 70 percent of total value. There is also a lack of focus on customer needs and lack of capital formation opportunities, risk averse investors.
Besides, successive bubble busts, i.e., biomems, optical telecom, have seen wary investors. There are very fragmented markets, many small companies and few large players. Also, there are limited 'success stories' of MEMS/MST companies, eg., Invensense. There are new market opportunities for large volume apps, eg. in automotive, CE, etc.

Downturn hit research hard! R&D remains a novelty for most firms. Now, there is an increase in university and R&D labs for MEMS development. There is still plenty of R&D available from DARPA, SBIR and STTRs. Now, we are seeing a healthy amount of activity in new devices and systems research.

As for DfM (design for manufacturing), Invensense's 'shuttle' process may finally become a usable standard. New approaches are also changing the paradigm of cost structure. Examples are Invensense gyros, Freescale chip-stacking accelerometers, ST, etc.

While there seems to be strong MEMS infrastructure, there is some fraying at the ends. The industry needs to remain competitive and lean. As for profitability, while the margins don't seem great for high volume MEMS devices, they are holding on somewhat. The general consensus of the VC community has been that MEMS has lot of growth potential, but it doesn't have a good track record of producing profitable firms, as yet.

The lack of DfM emphasis and the absence of a coherent package and test capability is the lack of management insight. As for standards, the creation of the first Standardized Sensor Performance Parameter Definitions is a huge step in the right direction.

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