Market opportunities for Indo-UK collaboration in semicon, electronics, green energy

Dave Gorshkov, sector champion, UKTI.

If you can recall, the UK Trade & Investment (UKTI) has been steadfastly pursuing a strategic initiative in India, with the intention to be a part of the growing electronics market in India.

In fact, UKTI partnered the India Semiconductor Association (ISA) during the ISA Vision Summit 2010 to explore the potential of how the UK and Indian semiconductor industries can work together to create powerful solutions for customers in India, the UK and the rest of the world.

UKTI, along with ISA, organized an industry meeting with Dave Gorshkov, sector champion for the UK government on ICT, electronics and semiconductors, UKTI, to discuss market opportunities for possible Indo-UK collaboration in the future.

UK areas of opportunities
According to Gorshkov, some of the UK areas of opportunities include central and regional government support, G-Cloud, Digital Britain and 21CN (BT’s 21st Century Network program), green data centers and smart grid opportunities, intelligent transport (ITS), congestion charging, CCTVs, etc.

There are several opportunities as well in the upcoming international sports events such as the 2012 Summer Olympic Games in London, the 2014 Commenwealth Games in Glasgow, Scotland, the 2015 Rugby World Cup in England and Cardiff (Wales), and the 2018 World Cup Soccer (UK has bid for this).

Now, all of these sporting events indeed present a host of opportunities, not only for India, but for other interested nations, won’t they?

Philips focuses on how interoperability, content sharing drive CE devices!

Nataraj Kumar, PIC.

Recently, I had the pleasure of interacting with Nataraj Kumar, director, Consumer Lifestyle, Philips Innovation Campus (PIC), where we discussed things such as Philips technology in interoperability, and the role of this technology in the Philips development ecosystem.

Content sharing platform and consumer behaviour are two key areas of focus for the Dutch electronics giant, Philips. As you know, connectivity and interoperability, as well as certification, play key roles in the overall make up of CE devices as well. To ensure that all devices work smoothly, consumer electronics manufacturers have to be very careful regarding testing and interoperability issues.

Last month, Philips had organized the Philips Connectivity Plugfest-02 at the Philips Innovation Campus in Bangalore, India. It attracted 31 companies who showcased 90 devices focusing on connectivity technologies — HDMI, USB, Bluetooth and DLNA.

As you can see, the focus was on content sharing over multiple devices — all of whom need to operate and function in unison — and that’s where the interoperability factor comes in!

In fact, more than 70 percent of the companies participating in the Plugfest-02 focused on HDMI. According to Nataraj Kumar, there were 42 products related to HDMI, while there were 23 products focused on USB. Bluetooth had 17 products and there were four related to DLNA (Digital Living Network Alliance).

In contrast, the Philips Connectivity Plugfest-01, held in June 2009 at the same venue, had attracted 15 companies who showcased 40 devices focusing on technologies such as Bluetooth, HDMI and DLNA!

Strong current focus on HDMI

Obviously, high-definition multimedia interface (HDMI) has been gaining in importance. Now, with HDMI 1.4 doing the rounds, the interest naturally has to be on the higher side. HDMI 1.4a, released on March 4, 2010, and adds two additional mandatory 3D formats for broadcast content, which was deferred with HDMI 1.4 in order to see the direction of the 3D broadcast market. It has also defined the mandatory 3D formats for broadcast, game, and movie content, respectively.

As per Nataraj Kumar, HDMI 1.4 supports the audio return channel, provides 3D support, as well as an HDMI Ethernet channel.

Elaborating on the Plugfest-02, he said that there were a range of CE devices, such as TV sets, graphic cards, active HDMI cables, control boxes, products that get into DVD players, etc.

He said: “We made a matrix of every company, and presented each company 45 minutes. Within that period, each company had to pick up its product — or source — and carry it to a synchronization device, which receives and displays data. Then they evaluated a variety of test cases that were already pre-defined by Philips.”

Most of the participating companies at Plugfest-02 were able to test successfully for interoperability and perhaps, also identify problems that could be later resolved.

Just how well is Philips geared up for HDMI is visible from its well equipped Interoperability and Certification Center (ICC) lab (sorry folks, no pictures).

The Philips’ ICC lab has the facility to handle HDMI 1.4 compliance testing. It also offers HDMI 1,4 CEC compliance testing, HDMI HDCP compliance testing, and HDMI and HDMI CEC interoperability testing.

The ICC lab offers interoperability testing with CE devices for Bluetooth, as well as Bluetooth profile testing. For USB, it offers USB interoperability testing, while for DLNA, it offers DLNA interoperability testing for 1.0 and 1.5, respectively. The lab offers RF4CE (radio frequency for consumer electronics) interoperability testing as well.

It must be mentioned here that the Bangalore ICC lab is a unique center within Philips. It ensures the certification and interoperability of Philips’ products before their commercial launch. This center is already involved in the design and development of several products.

Now, I couldn’t find any company showcasing WHDI (wireless home digital interface) capabilities. Perhaps, the technology is still very new! And what about Philips’ interest in this technology?

On inquiring, Nataraj Kumar said that Philips is exploring opportunities as to what the WHDI standard can do for home entertainment. Should Philips participate in this specification, it would possibly look into WHDI’s standardization process as well.

This downturn was NOT a classic semiconductor bust and boom, ignore industry fundamentals at your peril: Future Horizons

According to Malcolm Penn, chairman and CEO, Future Horizons, May’s semiconductor sales were up 2.6 percent on April, 3.6 percent for ICs, continuing the steady sequential industry growth that started in January 2009, 17 months ago.

May’s results mean Q2-10 will show at least 8.3 percent quarterly growth over Q1-10, increasing the full year growth forecast to 36 percent. Given last year’s growth was minus 9 percent, mathematically this is a classic industry cycle. It is NOT, he insists.

At this point in the ‘recovery’, it is much more important to look at sequential and quarterly growth rates rather that the 12:12 rates, given the high double digit rates they show are just as misleading and irrelevant as the high double digit negative rates from this time last year.  The reality is they net each other out thereby highlighting the real nature of the current cycle.  This downturn was a pause, the recovery a restart, it was NOT a classic semiconductor bust and boom.

Future Horizons has been telling everyone very publicly that the industry recovery started in March 2009, first in the April 2009 edition of its Global Semiconductor Report, substantiated by a very long and detailed analysis at the Geneva IEF2009 Forum last October.

The recovery, together with ever-increasing substantiating data, has been a recurring theme in its  Global Semiconductor Monthly Report ever since, as well as at the Dresden IEF2010 event in May 2010.

Penn added: “At the same time I have been warning that industry was cutting back existing capacity far too much and too fast whilst simultaneously failing to invest in net new capacity. Our clear message always was that these two factors were a recipe for disaster. The disasters are now starting to happen.

“While we obviously do not expect firms to run their business based on what we say, if the market recovery really has taken firms by surprise, executives from the top down either failed to recognise the significance of the data we were drawing their attention to over the past 15 months or they simply made the decision to ignore it. Ignore the industry fundamentals at your peril.”

Recovery not quite classic!
Future Horizons clearly states that this recovery is not a classic recovery. On being quizzed further, Penn said, “it was a dead stop and restart, just like hitting the pause button on your remote, rather than a crash and rebuild.” This is perhaps the same reason why the recession is now being termed as a market interruption.

Future Horizons has also been warning that industry was cutting back on the existing capacity far too much and too fast, while simultaneously failing to invest in net new capacity. Is the semicon industry still on this path?

Penn added: “Spending has now resumed (since Jan. 2010) and cut backs have stopped, but there’s a one-year time delay before these will start to impact. Why? Lack of industry confidence, driven too much by short-term financial performance, risk averse management and shareholders, lemming factor, etc.”

The long-term ramifications, should the industry fail to invest in net new capacity, are loss of sales and market position/leadership to those firms who did invest (e.g. TSMC, Samsung).

Well, it seems the global semiconductor industry has not learned enough from the previous recessions!

Semicon industry sales have peaked, growth to stabilize for rest of 2010 at 32-34 percent: Cowan's LRA model

This is a continuation of my coverage of the fortunes of the global semiconductor industry. I would like to acknowledge and thank Mike Cowan, an independent semiconductor analyst and developer of the Cowan LRA model, who has provided me the latest numbers.

Here is the latest update to the Cowan LRA model-derived forecast results reflecting the just released “actual” June sales.

The actual June 2010 global semiconductor sales announced by the WSTS came in at $27.153 billion which is:
* 38.6 percent higher than 2009’s June sales of $19.586 billion;
* Up 13.1 percent from last month’s (non-revised) sales of $24.007 billion;
* And lower (by $1.138 billion, or down 4.0 percent) compared to last month’s (May’s projection) sales forecast estimate for June, that is, $28.291 billion.

It should be highlighted that June’s sales report exhibited relatively large upward revisions for each of the months of Jan., Feb., Mar. and Apr., — resulting in a cumulative upward revision of $0.888 billion to the June year-to-date global semiconductor sales number (that is, $144.647 billion) as detailed in Table 1 below.

Table 1

Cowan's LRA Model -- Source: WSTS (Aug 2010).

As shown in Table 1 above, the WSTS reported upward revisions in the respective sales numbers for each of the first four months of 2010 of roughly the same magnitude (average per each month of $0.222 billion) with an overall  total approximating $0.9 billion. Also notice (see details in Table 2 below) that the June-reported 1Q10 sales number was likewise revised upward by $0.645 billion corresponding to an upward revision of 0.93 percent .

Table 2

Cowan's LRA Model -- Source: Reported by the WSTS.

Therefore, taking into account these upward revisions, the latest monthly update to 2010’s global semiconductor sales forecast estimate as determined by the Cowan LRA forecasting model becomes $303.914 billion corresponding to a projected 2010 year-over-year sales growth forecast estimate of 34.3 percent.

These latest forecasted 2010 sales and sales growth estimates decreased very slightly from last month’s reported sales and sales growth forecast estimates of $304.696 and 34.6 percent, respectively.

TÜV Rheinland opens South Asia's largest PV testing lab in Bangalore

TÜV Rheinland has opened India’s first and South Asia’s largest photovoltaics (PV) testing lab in Bangalore, India.

Just last week, Deepak Gupta, secretary, MNRE, had mentioned during his valedictory address at Solarcon India 2010 that an international lab was due to start a facility in Bangalore, and here you go! But first, a bit on TÜV Rheinland.

TÜV Rheinland has the expertise of testing PV modules, having been in the solar business for over 30 years. It has a market share  over 70 percent, and has seven PV labs spread across Germany, China, Taiwan, the US, Japan (two labs), and now, India. Its testing focus is on safety, efficiency, quality and durability of solar systems.

According to the TÜV Rheinland official, the total global investment in solar PV reached a record $40 billion in 2009. The PV cells production capacity is likely to exceed 33GW in 2011. Most importantly, 78 percent of manufacturers will be located in Asia. Further, the installed capacity of global solar panels is likely to reach 33.4 thousand MW by 2015.

Business prospects in India

TÜV Rheinland is well focused on the Indian solar PV market.

TÜV Rheinland obviously has been closely following the Indian solar PV market. India boasts of over 250 clear sunny days in year. Also, India’s solar potential is estimated at 600 TW per year. The PV industry output between 2002 and 2007 was said to 335 MW, with an export rate of 75 percent.

Coming to well known Jawaharlal Nehru National Solar Mission (JN-NSM), the Indian solar PV industry is estimated to grow to 100 GW by 2030. Also, 5 percent of the total power plant area will be used for PV power plants. The Indian government is promoting roof top solar generation.

TÜV Rheinland’s test laboratory in Electronics City, Bangalore, is spread over an area of 20,000sqft., including 5,000sqft. outside exposure testing area. It has invested close to $3 million in setting up the lab, thereby indicating a very deep interest in developing the Indian solar PV industry.

This PV test lab in Bangalore also happens to be India’s first and South Asia’s largest such facility. It has some unique facilities such as five climatic chambers and two sun simulators. With the inauguration of this facility, the availability of local testing and certification will now plug a key gap for the Indian industry.

TÜV Rheinland is offering the following PV services in India – PV module testing, PV module certification, PV power plants, conventional power projects, welding and non-destructive testing, installations, material tests and third party inspections. For the statistical minded, 70 percent of PV modules go through one of the TUV Rheinland labs worldwide.

The group’s global management is well focused on the Indian market and this PV test lab is a reiteration of an ongoing, long-term commitment to India.

Friedrich Hecker, CEO, TÜV Rheinland AG, said: “With the ambitious Jawaharlal Nehru National Solar Mission being operationalized, India is poised to take a huge leap in solar/PV. Module manufacturing, a key component of the chain, is largely domestically manufactured and offers a great export potential as well.

“The setting up of the PV lab by us today in Bangalore not only addresses the lack of such a facility in India but actually enables Indian module manufacturers to eye markets beyond India. India has always been a key strategic market for the group and all our different business units and this marks another step forward in that commitment.”

Andreas Höfer, chief regional officer, TÜV Rheinland (India, Middle East and Africa), said, “With abundant sunshine and high quality of radiation levels combined with focus on both grid and off grid applications, there is every possibility that India will be the market to watch out for in the region. We see a lot of overseas players investing here and setting up facilities or licensing technology for local players to manufacture with. In that way, both our entry and the setting up of this lab is timed well.”

Enrico Rühle, MD, TÜV Rheinland India, added: ”The Indian PV lab will be tightly interlinked to the other six laboratories across the world and will employ over 200 experts across functions. The lab which has facilities unheard of in the region like climate chambers and sun simulators will reduce the time for testing for Indian manufacturers.”

TÜV Rheinland India is part of the TÜV Rheinland Group, a leading provider of technical services worldwide.

Pressing need to address solar project financing in India: D. Majumdar, IREDA

During a session on financing solar PV in India at Solarcon India 2010 in Hyderabad, Debashish Majumdar, chairman and managing director, Indian Renewable Energy Development Agency Ltd (IREDA), said that India is facing a major problem — that is, how do we get the financial community to seriously look at solar!

He touched upon the three schemes that Dr. Bharat Bhargava of the MNRE had spoken about earlier. These are — NVVN scheme — typically 5MW/100MW schemes, rooftop component, and off-grid component.

Majumdar said that each one of these schemes has to be looked at differently. Two things will be important — generation and tariff. Tariff is derisked. All are going to look at the prediction and the forecast of generation. You will need good data to forecast for your project.

Power purchase agreements (PPAs) are signed in terms of MW. A change in mindset is also required. There are areas we often neglect. For example, the quality of water at site can create a lot of distortion in forecast generation. Or, how do you decide one module is better than the other?

On the 100MW scheme on power projects, Majumdar added that the entire history of what the distribution center becomes at downtime will be important. On the off grid component, Majumdar said that today, it looks small. However, it has the largest significance. Its impact is tremendous.

“Solar financing is tough. However, we will try to make it easier and show the financial institutions that it is possible to de-risk projects. We will get the lending community to activate itself,” he added.

Earlier, Dr. Bharat Bhargava, director, solar PV, MNRE, mentioned that the JN-NSM offers opportunities to invest in grid power projects, off grid projects and manufacturing. He added that the enabling polciy and framework is in place. Aggressive R&D and local manufacturing are necessary to achieve grid parity. He also outlined the R&D strategy. It includes:

* Research at academic/research institures on materials and devices.
* Applied research on the existing processes and developing new technologies.
* Development of CoEs on different aspects of solar energy.
* International collaborations.

Dr. Bhargava also mentioned the HRD strategy. It includes:
* Develop specialized curriculum for teaching solar energy at B.Tech, M.Tech and IIT levels.
* Announce fellowship for education and research.
* Provide training in grid and off-grid power projects.
* International training via bilatera programs.
* Testing and training institute.

India has bright future in solar PV, other RE: Stan Meyers, SEMI

According to Stanley T. Myers, president and CEO, SEMI: “India has a bright future in solar PV and other renewable energies. India should also acquire and develop the best research.” Meyers was speaking during a media interaction at the Solarcon India 2010 in Hyderabad.

(L-R): Daniel D. Martin, executive VP, PV Group, SEMI, Stanley T. Myers, president and CEO, SEMI, and Sathya Prasad, president, SEMI India, at SOLARCON India 2010, Hyderabad.

He said: “The NSM is the change in India. You try to look for simplicity, see what’s going on, and speed. We hope that happens in India.”

Meyers added: “We see SEMI playing the role as a ‘connector’ in markets where technologies are emerging. Two things need to happen in emerging technologies as well as regions. One, there has to be a roadmap — clear and defined. Two, there has to be standards development. SEMI is already playing a key role in  the standards for PV manufacturing equipment and materials. It will extend that activity into India as well.

“Our experience in standards in semiconductors has shown that standards results in cost reduction and the net benefit of cost savings is passed on not only to the consumer, but this also allows the savings to be ploughed back into R&D by the industry.”

Phase 1 of NSM critical for success

Meyers said that phase I of the JN-NSM is extremely important for India as it is in now in the execution level. He added: “Significant accomplishments made in this phase may set the parameters of Phase II of the NSM. SEMI will work with the PV industry in India in the execution of NSM and will collaboratively work with the regional associations/industry members and other stakeholder to help achieve the goals of NSM.”EHS (Environment, Health and Safety) and industry standards are two aspects SEMI has always been focusing on. We look forward to the opportunity to do the same in India.”