By Ron Iscoff, Editor Despite being the home of several world-class multinational electronics companies-most notably Philips of the Netherlands, Siemens of Germany and Thomsen of France-the European Economic Community has generally been perceived as unexciting where IC packaging is concerned. That perception (which many Euro-peans say is a misperception), may finally be changing, because of the superheated world market for portable communications. Cell Phones Consider that a key driver for the last several years in the EEC semiconductor market has been the result of cell phone sales by Ericsson of Sweden and Nokia of Finland. Both Scandinavian companies have displayed a prodigious appetite for communications ICs wrapped in very small packages to power their phones. A secondary, but key EEC market for electronics is the automotive industry, represented by such giants as Daimler-Chrysler of Germany.
Over the years, vendors selling to the OEM have gradually learned (often too late) that some companies do well in Europe, while others fare badly-whether or not they possess high-quality, savvy marketing or an astute knowledge of distribution channels. No less a major leaguer than Amkor abandoned its European-based IC packaging plant several years back. Ditto for ASAT, which sold its Wales packaging operation to an entity now known as Atlantic Semiconductor. Eurasem, a Netherlands-based chip assembler has managed to tough it out for a decade or more by keeping strictly within a rather small niche. Even smart (and experienced) people, backed by smart money, often fall victim to the pitfalls of operating in Western Europe. The name that immediately comes to mind is CS2, a high-end IC assembler located near Brussels. CS2, less than four years old, is now trying to work itself out of the Belgian equivalent of a Chapter 11 bankruptcy. It's not that EEC-based IC assemblers go after the volume business that Asia deals with so handily. Generally they don't, because they realize that EEC prices can't match jelly bean packaging prices of their Asian counterparts. The few companies that tried to compete in volume with low-end packages are just a vague memory. However, the excitement stirred by the popularity of cell phones has probably done as much for the IC packaging infra-structure in Europe as any other single event. Consider that Ericcson and Nokia comprise two-thirds of the ruling triumvirate (with Motorola) of cell phone suppliers.
David Greer, managing director-European operations for Universal Instruments, says the development of the ball grid array has been the fundamental turning point for the packaging industry in Europe and elsewhere. RF applications with higher frequencies, employed in communications, are among the key drivers in Europe, according to Michael Orschel, vice president of ESEC's die bonder business unit. While the CSP is a key player in European packaging, says Orschel, the system-on-a-chip "seems not to be feasible in many applications. Instead the system-in-a-package is becoming more important." Increased Functionality There is a progressive trend, adds Orschel, most obvious in automotive and smart card markets, for increased functionality combined with reduced size and improved reliability.
Lonny Plummer, a vice president at Swiss bonder maker Alphasem, says "Our European-based customers continue to drive forward on all fronts, requiring new technologies that will allow the assembly of die below 4 microns thick, calling for new adhesion methods." Plummer notes that many of Alphasem's European customers "are leading the way due to constant pressure from their customer base in the EEC automotive and communications industry. Both industries are pushing the envelope in terms of performance from a smaller and more robust package." He also notes that IC packaging in Europe is driven by the end product. Some 90% of the assembly in Europe comes from European foundries-much the same as the situation in the United States. In Asia, however, the die flows in from a worldwide supply base. Assembly Flexibility Plummer says that another key need in Europe is for assembly flexibility, which takes precedence over lower cost. "Our European-based customers demand systems and assembly technologies that are capable of handling a much greater mix of products and process parameters than in the U.S." Lot sizes, he adds, are smaller and changeover is "very important to European customers." Lisa Ryan, general manager-Europe for dispensing equipment producer Asymtek, observes that the EEC has sponsored a number of cooperative development programs and boasts several world-class academic research centers. Among the better known are the IZM-Fraunhofer Institute in Berlin, IMEC in Belgium and IVF in Sweden.
"Many European companies design and fabricate wafer products within the boundries of the EU and rely on Asian companies for labor-intensive steps, such as packaging," says Ryan. "However, these packages return to the EU for assembly to board-level communications products. European SMT assemblers, moreover, are now putting in place the ability to underfill CSPs. "This will lead, in a few years, to the introduction of flip-chip devices in systems," according to Ryan. Ryan agrees with her colleagues that the key drivers in Europe are mobile phones, smart cards and high-end automobile electronics. "While Japan is the electronics consumer product leader, Europe appears to be more focused on communications products. Last year, we saw a move from OEMs to contract manufacturing plants in Eastern Europe. These countries possess a good supply of engineering talent and their cost structures make it attractive to build products in these countries." The negatives in Eastern Europe, she says, "are improving dramatically, but their speed of improvement is a key factor in the long-term development and viability within these countries.
Dow-Corning's Dr. Eric Vanlathem, based in Seneffe, Belgium, concurs that while "IC packaging in Europe is highly advanced, mass production of advanced packages by European semiconductor companies is lagging." However, he adds, packaging "is certainly moving towards the leading edge for MEMS/ MOEMS applications." The last word goes to Dr. Claudio Truzzi, vice president-engineering at CS2 and a veteran of the European semiconductor industry, including posts at Siemens. CSP manufacturing in Europe makes sense, says Dr. Truzzi, because the contribution of labor to the packaging process is rapidly diminishing as a factor in overall packaging costs. "Today, capital investments to increase efficiency and enable new technologies have become one of the most important criteria for the success of packaging foundries tomorrow. Additionally, with the growing system-level emphasis of packaging technology, packaging foundries are working more closely with OEMS."
Success Factors Quick reaction times and proximity, he adds, are increasingly becoming critical success factors to the foundries, as well as the component makers. This proximity is vital in the telecom sector in Europe, he notes. "In the communications sector, product life is very short and fast development time is of the essence. Packaging foundries here will also play an important role in introducing and enabling wafer-level CSP technologies, which inherently address some, but not all of the industry's packaging requirements." Process changes, adds Dr. Truzzi, will require packaging foundries to upgrade traditional offerings from simple die attach-wirebond-encapsulate to an entirely new set of disciplines, including photolithography, thin film deposition and chemical plating. In additon to the technical demands of the automotive and telecom markets, EEC packaging is also being driven by "green" manufacturing demands for environmentally friendly ICs, according to Armin Beyrich, QA/product engineering manager for National Semiconductor Europe. While legislation calls for "lead free" products by 2006, "European users are requesting lead- and halogen-free ICs from next year on," he observes. |
Copyright © 2001