A product development should always start with a feasibility study. A product is feasible if:
This is so obvious that it is important to keep it in mind! One often forgets obvious things. However, most requirements comply with the laws of physics, fortunately.
Some “laws” are sometimes considered as fundamental while they are not, being only a limited collection of experimental data or extrapolated trends. These “laws” can be overcome while the laws of physics can't.
Not only must the specification be achievable in absolute, but also it must be achievable with what is available... If a process exists to do the job but if this process is not available to you, the product is not achievable. If special tooling is required, either for designing or for manufacturing the product and if either one is not available nor affordable, the product can't be done. In particular,questions to address are:
When the product is feasible in absolute and the process and tools are available, the required skills must be available and the available resources such as design manpower and production capacity must be sufficient to reach timescale requirements and production rate. Questions to answer:
This is probably the most important issue: A product can be done if it makes money. But this is addressed at the end since it depends on all the other items even though, practically cost aspects must be kept in mind permanently during the feasibility study (and during the entire product life!). Integrated circuits costs divide mainly in two parts:
Manpower costs must be evaluated. Apart from salaries, additional costs such as fixed costs and software licenses must be taken into account. These can more than double the cost of manpower.
Mask costs strongly depend on process generation. Mature processes masks are not so expensive while the latest processes have huge mask costs.
Production costs divide in three parts:
Silicon cost is more or less proportional to IC die size. In fact, cost increases a bit quicker than die size because of the yield impact. For a given defects rate, the larger the chip, the more likely a defect to occur. The cost per mm2 depends on the process.
Factors impacting the cost are:
Package cost depends on:
Test cost depends on:
There are mainly two models for calculating the product cost. Either the NRE costs are covered separately, either they are distributed over production. The first approach is standard for low volumes, the second for high volumes. Sometimes, an hybrid approach is used. Part of the NRE costs is covered separately, part is distributed over production.
Product sales price is calculated taking into account production costs and target margin. As already stated, sales price suffers from a significant reduction pressure in the 5 to 15 % per year depending on volumes.
At the end of the feasibility study, four items must be available: