In the era of a slowing of Moore’s Law, advanced packaging has become an enabler for future innovation in semiconductors. The semiconductor industry is entering a disruptive phase where, along with mobile, new mega drivers such as big data, AI, 5G, high-performance computing (HPC), IoT (including industrial IoT), smart automotive, industry 4.0 etc., have the potential to transform the industry putting it on a high growth path.
Mobile market unit growth is slowing, but there is still plenty of room for improvements (and opportunities) in imaging, sensors, processors, AI, AR/VR. Electronic hardware needed to support these new mega-trends require high computing power, high speed, more bandwidth, low latency, low power, more functionality, more memory, system-level integration, a variety of sensors, and most importantly, a low cost. These trends will create tremendous business opportunities for advanced packaging as it is ideal for enabling the various performance requirements together with the complex heterogeneous integration needs…
From 2017 – 2023, revenue for the total packaging market will grow at a CAGR of 5.2%, while revenue for the advanced packaging market will grow at a CAGR of 7%, reaching $39B in 2023.
Yole Développement (Yole) released its famous annual technology & market analysis, Status of the Advanced Packaging Industry few weeks ago. Yole, the market research and strategy consulting company, had the opportunity to share its vision of the industry with the leading company Amkor Technology. The discussion between Ron Huemoeller, Corporate Vice President, Head of WWRD & Technology Strategy, Christopher A. Chaney, IRC, Vice President, Investor Relations, Amkor Technology and Santosh Kumar, Director Packaging, Assembly & Substrates, Yole Korea is reproduced below.
Santosh kumar (SK): Being a top OSAT company (currently ranked no 2 worldwide), Amkor remains at the forefront of packaging technology innovation. Briefly introduce Amkor and its current activities, with a specific focus on advanced packaging.
Christopher A. Chaney / Ron Huemoeller (CC/RH): As you mentioned, Amkor is one of the largest OSATs globally. Not only are we a market leader, we have been around a long time. This year marks our 50th year in business, and over the years we have generated a great deal of customer trust and loyalty. We are geographically diversified, with more than 20 manufacturing facilities in strategic locations serving customers globally. Our broad package and test capabilities make us a good choice for customers in the mobile communications, industrial, computing, automotive and consumer electronics end markets. Many years of working closely with our customers and significant investments in R&D have made us a leader in advanced packaging. We are seeing strong interest for advanced packages in mobile, high performance computing and automotive applications and we work with customers in those industries to develop solutions that meet their needs.
SK: Amkor registered record sales of $4.2B in 2017, up 8% from 2016. Which market segments and devices recorded the strongest growth in the packaging business?
(CC/RH): Our communications end market, which represented over 40% of our sales in FY17 grew 10%, driven by the smartphone business where we are engaged with several leaders in the iOS and Android ecosystems. Automotive and industrial, our second largest end markets with just over 25% of total sales, grew by nearly 8%. This was largely due to the adoption of more advanced driver assistance, safety and telematics systems in today’s cars. Within these two end markets, advanced packaging is driving most of the growth.
(Courtesy of: Amkor Technology – October 2018)
SK: The semiconductor industry is going through a strong growth phase and in 2017 recorded the highest growth over the last 10 years (22% YoY in 2017/2016 vs 1% in 2016/2015). How do you see the semiconductor industry growth trend in the coming 5 years? Do you think the growth momentum will continue, or will there be a slowdown?
(CC/RH): The semiconductor industry has always been cyclical, but as the industry has matured over the least 10 years or so, its cyclicality has been less pronounced than it once was. This is due to the maturity of the end markets it serves, as well as the suppliers that feed it. While it’s hard to predict the next cycle, we see numerous market drivers for the industry, such as continued growth in mobile applications, cloud computing and storage, automotive and numerous other applications eventually requiring artificial intelligence and of course the eventual rollout of higher speed communications networks such as 5G which will push the need for new infrastructure and handsets in the years to come.
SK: The semiconductor industry has for long been driven by the mobile sector. However, in the future we see multiple drivers, such as artificial intelligence, smart automotive (electrification and autonomous driving), 5G, IoT and hyperscale data centers, all of which will drive growth in the industry and innovation in packaging. What is Amkor doing to adapt to the new circumstances, and how are you preparing for potential new markets and applications?
(CC/RH): We agree that these are among the industry’s future growth drivers and we are engaged with a broad set of market segment leaders in each of these markets. Working closely with our customers gives us insight into future roadmaps so we can make the appropriate R&D and manufacturing investments.
SK: Growth in the mobile sector has slowed down but it still drives innovation in packaging, be it APUs, RF modules, imaging, sensing etc. What do you think are the next packaging trends in mobile, and how is Amkor positioned to gain from it?
(CC/RH): Thinner, more compact integrated packaging is the continued trend. Innovation on how mobile packages are fully assembled, at all levels (including EMS) will be in focus with emphasis on overall profile reduction. Additionally, while there is a strong push to innovate at the integration end, simultaneously there will be equally strong push to innovate at the cost end. As a result, we will see an increasing momentum to remove material content from these complex packages.
SK: FOWLP is the fastest growing packaging platform and it has been adopted for various applications from mobile to automotive to medical, for packaging both low-end (e.g. audio codecs) and high-end devices (e.g. APU). How is Amkor positioned in the fan-out packaging business?
(CC/RH): Amkor is positioned well for low density fan-out (LDFO) packaging with high volume manufacturing (HVM) well established in Portugal, in our Porto factory. We also have low volume manufacturing capability (LVM) in Korea at our state-of-the-art factory in Incheon (K5). Additionally, we have qualified and established volume manufacturing capability for high density fan-out (HDFO) also at our K5 automated state-of-the-art factory.
(Courtesy of: Amkor Technology – October 2018)
SK: The TSMC InFO package for Apple’s iPhone A10 processor has created lot of news and excitement in industry and there has been speculation that other players will also adopt fan-out packaging for their latest APUs in 2017. However, this has not happened, and high end mobile APUs from top players (except Apple) are still in flip-chip packaging (fc-PoP or MCeP). What do you think is the main reason behind this, and will we see more players adopt fan-out packaging technologies for high end mobile APUs in 2018 or 2019? What are the packaging trends for discrete baseband processors?
(CC/RH): Further adoption of HDFO packaging for APU’s remains unclear. In the near term, current packaging methods are not only sufficient to address electrical requirements, but also are significantly cheaper to produce than an HDFO solution. However, in the longer term, I do believe we will see increased adoption of HDFO in adjacent markets to address heterogeneous integration requirements. This may include the APU market as well as die content for processor packages increase, requiring architectural change to packaging integration.
SK: Fan-out packaging is taking market share from flip-chip packaging, which is affecting the substrate players. Do you think this trend will continue, or could reverse migration also happen (fan-out going back to flip-chip)? Do you see devices currently using other packaging platforms such as QFN/QFP or fan-in WLP moving to fan-out?
(CC/RH): Short term, indecision will remain with package formats vacillating between flip chip technology and fanout with cost as the primary driver. In the longer term, fan-out will ultimately win out in the end as efficiencies in processing take hold and yields improve in the larger formats. Inherently for fan-out, there are fewer materials and processing steps vs substrate-based flip chip packages. The larger adoption rate will be primarily driven by processing formats changes allowing broader efficiencies to kick in reducing the cost to manufacture.
SK: Fan-in WLP growth is still driven by the mobile market. Do you expect to see significant adoption of Fan-in WLP outside mobile?
(CC/RH): In general, Mobile continues to be the primary driver for WLP packages, with the clear majority of volume in either the handset or in accessories for handsets. We do see additional growth in wearables as well. From an IoT perspective, we see WLCSP eventually migrating into this market space and machine to machine communication.
(Courtesy of: Amkor Technology – October 2018)
SK: What are the technological trends in Fan-In WLP (in terms of RDL passivation material, ball attach, bump pitch, die size etc.)? What does the future of the FI WLP market look like, bearing in mind the rapid development and promotion of other emerging advanced packaging technologies?
(CC/RH): The transition from 500 µm pitch to 400 µm happened over the last two years. We still see further interest to reduce to 300 µm pitch with a limited product sect as well. From the macro scale, overall improvement in board level performance (new materials, structures, passivation thicknesses, etc.) is in clear focus. This includes protecting the die edge with mold. Increasing board level performance enables higher confidence in the existing product space and provides a path to larger devices in the futures.
In general, 200 mm will grow at a slower rate than what has been experienced in the last couple of years with 5G driving a portion of that growth, but not necessarily large volume growth. An increase in specialty silicon products will also be a driver of growth in the 200 mm format.
SK: IoT is one of the key drivers for the semiconductor market. IoT devices broadly consist of 4 parts: sensors, MCUs, connectivity, battery/power management. Which packaging platform is likely to benefit from IoT business?
(CC/RH): For IoT products, strong integration drivers already exist for the elements described above. Package technologies such as SiP, FOWLP, embedded IC’s and/or passive devices, as well as laminate multi-die formats, are likely to increase in use to address many of the IoT applications looking forward.
SK: Memory devices business is booming, and Chinese players are also entering this market. However, most memory devices packaging is still done by the memory suppliers. As an OSAT, where do you see opportunities in memory packaging and how is Amkor positioned to support the memory packaging business?
(CC/RH): Amkor has been engaged with multiple customers over many years for NAND memory assembly and test. Through this extensive experience, we have developed the expertise to allow high volume manufacturing capability from low die stack to high die stack product which also includes SSD NAND memory in a SiP package. Our engineering team continues to work with our customers to develop packaging and test capability for current and next-gen 3D NAND. The outlook for this market is promising and will remain a continued focus at Amkor.
SK: DRAM for PC and servers are moving from wire-bond to flip-chip package at an accelerating pace. Mobile DRAMs are currently packaged using wire-bond. Do you expect mobile DRAM packaging to migrate to flip-chip or fan-out packaging?
(CC/RH): DRAM can be integrated using flip chip technology in a side by side format using current processes and materials. We see increasing interest in flip chip DRAM design parameters that are not side-by side formats. Primarily, this involves integrating DRAM into a CSP package that houses either another Silicon element that is also flip-chipped in the package. Additionally, flip chip has been employed for a number of years already with the implementation of TSV memory stacks on a controller board by means of flip chip technology.
SK: TSV interconnect-based 3D/2.5 packaging is growing rapidly. Depending on performance, integration requirements and technological complexity, TSV application areas can be broadly classified as high, middle and low end. High end includes 3D memory (HBM, HMC) and Si interposer, while middle and low ends include image sensors and MEMS respectively. OSATs are involved in the middle and low end while the high end is dominated by IDMs and Foundries. Do you see an opportunity for OSATs in the high end TSV business?
(CC/RH): Amkor is already participating in what is defined as high end TSV by the standards listed above. We have continued production activity in 2.5D products for high end devices today, as well as scheduled into our future. The lower tiers of TSV are isolated to vias last technologies with a very mature market in place.
SK: Si interposer is an established integration platform. Do you see an opportunity for organic or glass interposers?
(CC/RH): There is significant opportunity for both glass and organic solutions to move into the market. Both offer better electrical performance and significant cost reduction opportunities to traditional silicon interposer based 2.5D. To be clear, the silicon interposer platform is a proven platform and the preferred method today. However, it remains constrained in both supply chain and overall capacity. In fact, today with respect to the current 2.5D platform, production manufacturing is in place at only a couple of OSATS (Amkor as one of them), while the large majority of production is isolated to one non-OSAT company.
SK: System-in-Packages (SiP) are a hot topic, both for high end and lower end applications, whether it’s 2.5D TSV, FO WLP SiP or Flip Chip cored/coreless packages. How do you see the SiP market potential and future evolution? What are the main drivers, bottlenecks and competitors to SiP? How is Amkor positioned to address the SiP market?
(CC/RH): System in Package products will continue to expand at a rapid pace. The integration will accelerate with emphasis on structure, electrical proficiency and increased functional IC and passive element content. Expect to see new materials introduced to address the electrical performance, especially in mmWave products. I also expect to see continued emphasis on module density, with the modules growing in size, but at reduced cost. Although these two items would appear to be at a paradox, with the latest advanced packaging techniques it is conceivable to enable a path to greater die content and reduced material content.
The primary bottleneck to SiP today in the industry is simply capacity and the ability to turn new product qualifications fast enough. The growing demand for SiP from the industry is generating a continuous stream of new products, requiring further need to invest/expand existing HVM capacity. Cash flow and investment capability will narrow the field of participants as a result
Amkor has enjoyed tremendous growth in our SiP portfolio and we continue to place emphasis on expanding capacity and capabilities. We have a broad toolbox available to us for SiP as this has been a key area of focus at Amkor. We have added a dedicated RF design team, complete with a full suite of analysis tools. We have a very large dedicated R&D team in Korea, numerous dedicated sophisticated advanced manufacturing lines and a highly competent business unit directing growth and focus.
SK: Integration is the keyword in SiP technology, often requiring inclusion of heterogeneous technology. Apart from functional ICs, this also means integrating discretes and passive devices (IPD). What SiP integration trends do you foresee in the future? How is Amkor positioned to address the need for heterogeneous integration?
(CC/RH): There will be continued focus on module density and profile. We are continuing to see demand for highly integrated modules with complex packaging schemes that populate both functional ICs and passive elements on all sides of the interposer/substrate. Embedded ICs and passives (whether in IPD format or discrete) are now centerpiece to SiP modules, with increasingly complex packaging schemes employed to reduce height and overall package length/width as well as maintain very high yielding processes at appropriate price points. At Amkor, we have continued to successfully push this envelope forward with clever packaging techniques and structures. The demand for heterogeneous integration plays well into our strengths and focuses in an area where Amkor excels with the breadth of advanced package capabilities and the expansive toolbox available to us.
SKU: While semiconductor companies are consolidating and rearranging their portfolios, the semiconductor supply chain is changing. When it comes to advanced packaging, different innovative technologies are arising, as well as different business models. Players from different businesses such as substrate manufacturers, foundries and EMS are entering the market. TSMC is already established and growing in an area where packaging houses used to solely dominate. As a key OSAT player, do you think it as a challenge for the packaging business? Is there enough opportunity for everyone in the advanced packaging business?
(CC/RH): What we are seeing is a strong indicator and endorsement for the increasing need for advanced packaging in the semiconductor industry. Functional integration through packaging has taken center stage and will increase in focus in the semiconductor industry as Moore’s Law slows and cost/hurdles to advanced node silicon increase.
Although the entrance of players from different business sectors presents new challenges, in reality, it is simply additional competition, not differing much from the competition we have maintained with other OSATS over the past couple of decades. It is important to note that at the same time, much of the older competition is dropping off due to inability to invest and maintain competitiveness. With the increased focus on advanced packaging, there is more than enough room to accommodate the new entrants.
Ron Huemoeller, Corporate Vice President, Head of WWRD & Technology Strategy, Amkor Technology
Ron is a Corporate Vice President at Amkor Technology. He joined Amkor in 1995 and has served in multiple executive level leadership roles encompassing business and technology development. Currently, he is responsible for Global R&D and Technology Strategy at Amkor. Prior to joining Amkor, Ron was Director of Engineering at Cray Computer Corp. in Colorado Springs for five years, leading the startup and development of state-of-the-art motherboards for the world’s fastest supercomputer.
Ron has authored numerous technical publications, co-authored a chapter in the Handbook of 3D Stacking (McGraw Hill), co-authored in the book Embedded and Fan-Out Wafer Level Packaging Technologies and has been granted more than 125 U.S. patents, including foundation patents in SWIFT®, TMV®, SLIM™ and numerous substrate technologies.
Ron holds a B.S. in Chemistry from Augsburg University with highest honors and National Honor Society, an MBA in Business Management from Arizona State University and a Masters in Technology Management from the University of Phoenix. He is also currently President of the ‘International Microelectronics Assembly and Packaging Society’.
Christopher A. Chaney, IRC, Vice President, Investor Relations, Amkor Technology
Chris joined Amkor in May 2018 to lead the investor relations function. Chris has more than 20 years of experience working with investors and public companies. Chris spent the early years of his career as a senior investment research analyst in semiconductors at A.G. Edwards. While an analyst, Chris was awarded “Best on the Street” for stock-picking performance twice by the Wall Street Journal. He has also been frequently interviewed by business news channels such as CNBC and others for his expertise and knowledge of semiconductor investing. In 2010, Chris transitioned to the investor relations profession, joining MEMC Electronic Materials where he was instrumental in executing multiple financial transactions as well as the initial public offering of the semiconductor wafer division. While at MEMC, Chris’ investor relations program won accolades as “best in the industry” in Institutional Investor’s poll in 2012. Chris holds a B.S. in Management from Tulane and a Masters in Business Administration from Washington University in St. Louis. Chris is an Investor Relations charter holder and has passed level 2 of the CFA exam. He is a member of the St. Louis CFA Society, the National Investor Relations Institute (NIRI) and has served on the board of the St. Louis NIRI Chapter.
Santosh Kumar, Director Packaging, Assembly & Substrates, Yole Korea
Santosh Kumar is currently working as Director Packaging, Assembly & Substrates, Yole Korea. He is involved in the market, technology and strategic analysis of the microelectronic assembly and packaging technologies. His main interest areas are advanced IC packaging technology including equipment & materials. He is the author of several reports on fan-out / fan-in WLP, flip chip, and 3D/2.5D packaging.
He received the bachelor and master degree in engineering from the Indian Institute of Technology (IIT), Roorkee and University of Seoul respectively. He has published more than 40 papers in peer reviewed journals and has obtained 2 patents. He has presented and given talks at numerous conferences and technical symposiums related to advanced microelectronics packaging.
In the era of a slowing Moore’s Law, advanced packaging has emerged as the savior of future semiconductor development – Get more