Faced with selecting a test vendor, most semiconductor makers usually have limited and fairly straightforward choices. You can handle final test internally, using your company's resources. Alternatively, you can subcontract the work to either an IC assembler with test capabilities, or you can opt for a specialized test house. The picture is different, however, for fabless semiconductor makers, who account for about 9-10 percent of total ICs manufactured. Limited Options In addition to lacking a front-end facility, where the patterned ICs are fabricated on wafers, most fabless operations also lack assembly and test facilities. In this case, the options are more limited, but theoretically even simpler. The business benefits to IDMs (independent device makers) and fabless companies of utilizing an outsourcing model can be critical to their business and product strategy. Most IDMs today, in fact, have publicly stated that their corporate strategies have shifted to include outsourcing a percentage of their assembly and test requirements. As the industry adopts the outsourcing model, the need to align with a test supplier that offers assembly, test and engineering services is becoming extremely important. There are a growing number of cases where major IDMs outsource most-and in some cases-their complete production of certain devices to a skilled assembler with final test capabilities. Why? There are several reasons, but a key driver is cost. Typically, the assembler can supply both package assembly and test at lower cost than the IDM's organization. Logistics In almost all cases, logistics play an important role in the decsion of whether to keep IC test inside or to align with an outside test vendor. Semiconductor makers typically favor a test house over an IC assembler/test provider for one of three reasons:
Manufacturing Efficiencies The most obvious benefits of completing final test with the assembler that packaged the product are cycle time improvement and reduced cost, achieved through combined manufacturing efficiencies. Product cycle times and costs are reduced since material can be scheduled into the test line immediately following assembly. This eliminates at least one shipment as well as the cost and time delay in preparing the packaged ICs for shipment - which may send the devices to another country. In today's market, timing is everything. As product life cycles become shorter through advances in technology, companies that provide specialized services on an outsourced basis can add appreciably to the customer's success-and balance sheet.
These benefits are normally gained with few tradeoffs to the customer. In many cases, an independent IC packaging foundry will offer enough test platform options to meet customer needs. In those instances where application-specific configurations or platforms are needed, the packaging foundry will often partner with the customer to share the cost of high-end test equipment. This results in a "win-win" situation for both customer and supplier. When the chip supplier's end user is in Asia, and the supplier selects a company in Asia to handle assembly and test, the latter can drop ship to the end user at relatively low cost. Fabless Benefits While there are many benefits for an IDM with fab, assembly and test facilities to outsource part of its assembly and test, fabless companies will realize even more benefits by selecting the appropriate packaging foundry. For example, the vendor that handles a fabless firm's assembly and test together will take ownership of problems, when they occur. When devices are sent to one vendor for assembly, and to another for test, it's hard to pin down the source of any problems. If the ICs are damaged, did the damage occur at the assembler's plant, in transit or in receiving at the test supplier? It's exactly cases like this that may develop into a finger-pointing contest, where each vendor blames the other. The customer, unfortunately, is placed squarely in the middle. When you reduce the cycle time for problem resolution, you will, inevitably, increase product yield, quality and cycle time (and lower costs!). Additional benefits for IDMs and fabless providers often result in improved test cell use. Some industry reports indicate that IDM test cells operate at <50% utilization, while outsourced vendors will typically exceed 65%.
And don't forget, the cost of test is calculated on usage, not a capital depreciation model, something which should also reduce the customer's cost of test. Questions When you prepare to select your next assembly and test supplier, there are a few questions you have to ask (and answer). The importance of each answer should weigh heavily in your ultimate selection. For example:
Test Audit Once you've made a preliminary selection and assessment of the potential test supplier, it's time for an audit. The audit involves sending one, two or a team to the candidate company to examine the equipment and the engineers that will be responsible for your ICs. This is an easy and profitable step-in terms of your future expectations-if done correctly. To ensure the audit's success, the individuals sent for the audit must be the right people. Who are the "wrong" people? These are people who know little or nothing about test. Conclusion If you're a fabless house, the decision is relatively easy: You must go outside. If you're running in high volume, you must test with a packaging foundry that offers virtually complete turnkey service or you will be wasting cycle time paying more to ship to one company for assembly, then to a second for test. If you operate a captive assembly and test facility to complement your wafer fab, the outsourcing issue is sometimes not as clear. What has become clear, however, is that in good times, end-user demand will probably outstrip your internal capacity for assembly and test. If you have waited until the last minute to find the perfect vendor, you may also find you're waiting at the end of a very long line of device makers, on allocation, who are already customers.
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