Obsolete semiconductors: A proactive approach to End-of-Life

Story

February 15, 2010

George Karalias

Rochester Electronics

One thing that?s inevitable in military electronics is semiconductor obsolescence. But is there a way to plan for EOL - thereby obsoleting obsolescence and avoiding gray market practices while limiting risk before it's too late.

As electronic technology advancements continue to accelerate, semiconductor life cycles continue to shorten. The average life cycle of a typical semiconductor device is approximately three years, which includes introduction, design-in, production, low-volume, and End-Of-Life (EOL) phases. Once a manufacturer discontinues a product and an EOL announcement is made, customers typically have 6 to 12 months to decide whether to place a last-time buy, or find an alternative solution.

A semiconductor EOL announcement can create a costly inconvenience for customers, as it can be difficult to accurately forecast last-time buy requirements, absorb the additional inventory and storage costs associated with last-time buys, or find an available drop-in replacement. Because the EOL schedule does not typically support the continuing needs of all of its customers, especially those serving applications with long system life cycles, many companies are left in a difficult position.Their supply chains are interrupted, and they no longer have a reliable component source to meet ongoing production, maintenance, and repair requirements.

Companies supporting applications with long-term service requirements such as government, military, and aerospace, along with other Original Equipment Manufacturers (OEMs), can also find themselves servicing and maintaining a product in the field for years without the support of an original semiconductor manufacturer. Faced with an uncertain supply and a steady demand, a customer might have few choices in finding an alternative source for the discontinued semiconductor, making EOL planning all the more vital.

EOL planning: Obsoleting obsolescence

The discontinuing of semiconductor devices is inevitable. Every product and technology has a life cycle, thus it is only a matter of time before a semiconductor device is discontinued by the manufacturer to make way for the next-generation part. OEMs need to plan ahead for EOL announcements, perhaps implementing the plan as early as the time at which a semiconductor is designed into the end-equipment, to find a suitable new source for the critical semiconductor part (Sidebar 1).

Sidebar 1: Through unique programs, a device can be reverse-engineered to create an exact replica.

(Click graphic to zoom by 3.0x)

It is not enough for a customer to react to an EOL notification, since by that time a new source of semiconductor devices already needs to be identified and qualified as an authorized source for authentic and reliable parts. It is important for customers to have a proactive mindset for the EOL announcement of critical semiconductor components to ensure continuous manufacturing with traceable, high-quality semiconductors. By implementing an EOL plan, OEMs will have sufficient time to investigate the following options.

Drop-in replacement

A drop-in replacement is a “pin-for-pin” replacement of the original semiconductor device. If supplied by a trusted source, this solution enables a customer to bypass virtually all of the obstacles that the following two options carry.

Authorized continuing source manufacturer

Another solution for many customers is a contractually licensed continuing source manufacturer and authorized distributor of semiconductors to provide a continuous supply of qualified parts. These authorized manufacturers engage with the original semiconductor manufacturer to acquire the remaining inventory, including packaged devices, finished devices, die, selected intellectual property, tooling, test programs, and test equipment, thus extending the life of the semiconductor series. For example, Figure 1 shows an Intel 186 high-performance, low-power processor ideal for embedded applications, available through the Rochester Electronics Extension-of-Life process.

Figure 1: An Intel 186 high-performance, low-power processor ideal for embedded applications is available through the Rochester Electronics Extension-of-Life process.

Such a transfer of technology assures there is no interruption of authorized, certified, and traceable devices in the supply chain. Through contract, these authorized sources will place devices into bonded inventory, where the devices are safely and properly stored in dedicated temperature- and humidity-controlled warehouses, as seen in Figure 2. Products are distributed to specific customers through a customized, comprehensive, scheduled, and managed program. The special product agreement alleviates many of the problems that arise from unplanned EOL events during the course of a critical system’s existence, including last-time buy and inventory storage costs.

Figure 2: Authorized sources will place devices into bonded inventory for a customer, where the devices are safely and properly stored in dedicated temperature- and humidity-controlled warehouses.

Redesigning the system

If a drop-in replacement cannot be procured from the original manufacturer or secondary sources, one option is to redesign the system to eliminate the part, or use a different device in its place. A redesign can be costly due to engineering man-hours and the expense of purchasing new devices as well as from production downtime as the new system goes through retesting and requalification processes. There is also the real possibility that the new device will eventually be unavailable due to an EOL announcement. For many customers, a redesign might not be a feasible option due to costs and the lead time associated with mission-critical board-level certifications such as MIL-PRF-38535, MIL-STD-883, and many more. OEMs who do not plan ahead might be forced to consider unauthorized sources, such as brokers and independent distributors for available excess inventory.

Gray market practices: A risky proposition

The danger of buying components through brokers or independent distributors on the gray market is that there is no guarantee of authenticity, quality, traceability, reliability, and continuous availability of the parts. OEMS have no easy way to ensure that the devices purchased are genuine or that the components have been properly stored and handled to ensure quality and reliability. Counterfeiting – the fraudulent manufacturing, distributing, and selling of fake or replica semiconductors – is a growing problem throughout the electronics industry. As counterfeiters become more sophisticated, the probability of receiving re-marked devices increases. These devices could include falsified part numbers or company logos, empty devices with no die, falsified paperwork/RoHS compliance, and counterfeit chips.

Counterfeiting devices has a negative effect on reputable component manufacturers and distributors, causing purchasing dilemmas for component buyers, problems for equipment manufacturers, and trouble for equipment operators. In a worst-case scenario, counterfeit components can cause legitimate manufacturers to be driven out of business or experience catastrophic disasters through equipment failure. For mission-critical applications such as military and aerospace, there can be even more serious consequences: Faulty equipment can result in loss of life. An OEM who believes a part is faulty or counterfeit should immediately report problems to the original semiconductor supplier.

Limiting risk

To limit risk when purchasing obsolete semiconductors, consider cost instead of pricing. Even if a bargain is available for semiconductor devices from an unauthorized source, one must consider the overall cost of manufacturing downtime and/or failure of the end-product if the part turns out to be faulty or counterfeit. These costs far outweigh the front-end savings, not to mention the incalculable cost of damage to the company’s reputation.

There are only two fail-safe ways to ensure that a semiconductor device purchased is legitimate: 1) buying directly from the original manufacturer; or 2) enlisting the help of authorized distributors and manufacturers. No amount of testing and screening can give 100 percent assurance when devices are purchased from unauthorized sources. The practices of planning ahead and developing a partnership with an authorized source ensure a continuous stream of genuine devices for the foreseeable future.

The bottom line

Planning ahead for a semiconductor EOL announcement as early as during the OEM product design process can simplify a potentially troubling semiconductor procurement situation and save the OEM money. By partnering with authorized distributors or the manufacturer, the life of the once-discontinued part can be extended, and the OEM can avoid forecasting last-time buys and incurring inventory storage costs. These partnerships also allow the OEM to bypass dealing on the risky gray market, where procuring faulty and counterfeit parts could cost millions of dollars as a result of manufacturing downtime and the failure of the end-product in the field. Planning ahead for EOL ensures there is no interruption in the OEM’s supply chain and that manufacturing can continue with traceable, high-quality semiconductors from a reliable and trusted source.

George Karalias is the Director of Marketing and Communications for Rochester Electronics, where he has worked for 10 years. His experience in the high tech and computer industries started after his graduation from Boston College. George can be contacted at [email protected].

Rochester Electronics 978-462-9332 www.rocelec.com