Marvell Semiconductor has been on quite the roll from a product and stock price standpoint the past four years under the leadership of CEO Matt Murphy. Since his arrival in June 2016, the stock is up 4X as a result in a massive overhaul of… pretty much everything. I documentedthis turnaround in January at the company’s first industry analyst event. The company hasn’t slowed down during Covid-19 as it improved its 5G portfolio and added both Samsung and Nokia, gave a sneak peek into its ThunderX3 general-purpose server platform, and rebranded the company.
Last week, Marvell Semiconductor announced it will now offer a custom ASIC SoC service effective immediately. If you are not familiar with an ASIC (Application Specific Integrated Circuit), let me help. What helps me is to think of different kinds of silicon in terms of software programmability versus efficiency on a spectrum. On one end, we have a CPU that is endlessly software programmable but not as efficient for a specific application. If you go down the line you have GPUs, FPGAs, DSPs and at the opposite end of the programmability spectrum from a CPU, you have an ASIC. ASICs are the least software programmable but the most efficient in performing a specific task. ASICs are perfect when standards are baked, there’s not a lot of change, and you need the highest performance and the highest efficiency. Think audio, video, signal processing, networking, and machine learning inference.
When a customer inquires about designing a custom ASIC solution, a dedicated Marvell team engineering team gets assigned. The service will likely address the same verticals of Marvell's current business, including Automotive, 5G, Enterprise Networking, Aerospace, and Cloud Data Centers.
Many of the resources needed to offer this kind of service come from the recent acquisition of Avera Semiconductor from GlobalFoundries. Avera brings 25 years of custom ASIC experience to the table as it has passed through IBM and GlobalFoundries before being sold to Marvell. This service looks to leverage Marvell's comprehensive product portfolio with the deep custom ASIC experience of Avera Semi to create a compelling one-two punch for companies looking to build custom ASIC SoCs.
How the service works
I like to think of this service as a custom chip design team for hire. Once the customer has communicated an interest in building a custom ASIC chip, shared design goals, and agreed on a per chip price, the work can begin.
Customers will be able to leverage existing IP and custom bits while getting access to the entirety of Marvell's extensive IP library. Currently, Marvell has significant experience in networking, storage, CPU, and security. Customers can take a standard Marvell chip and add custom interfaces, accelerators, or a custom algorithm fit for the desired workload.
Marvell says the turnaround on a custom job like this will typically take anywhere from 12 to 18 months. The company isn't limited to a single fab they can work with, but for most projects, I assume TSMC will be the likely manufacturer. Working with TSMC gives customers access to multi-die chip packages. Multi-die chip packages allow HBM2, transceivers, PHY, interconnections, and other chiplets can be within the same packaging as the main die.
Once the custom ASIC chip is combined, simulated, and verified, Marvell will act as a liaison between the customer and the fab to ensure on-time delivery. Similarly, Marvell will also work on the licensing and royalty deals if customers opt to use ARM-compatible CPU cores in any of the products.
The value of a custom ASIC
Shifting the chip design, manufacturing, and technology licensing responsibility to Marvell will allow other businesses to focus on their core competencies. An excellent example of this is Sony and Microsoft partnering with AMD to build custom SoC for the last two generations of Xbox and PlayStation. The offerings of Marvell are vast and can be paired with existing customer IP to create a unique design optimized for the customer's desired workload. I listed some of Marvell's current product experiences that customers can leverage below:
- Storage Flash Controllers and Accelerators
- Ethernet PHYs, Controllers and Switches
- Infrastructure and AI Processors
- Automotive PHYs, Switches and Bridges
- Server Processors
- Security Accelerators and Processors
Marvell's custom ASIC business looks like a good alternative for customers who would typically purchase a standard ASIC or opt to build one. I love that customers have the ability to bring their own IP and have it hardened in an SoC via an ASIC. Although the service could be costly, few companies have the competence to bring silicon design in house and do it well. Apple is one of the only companies that has pulled it off successfully and they’re not great at ASICs. I believe the complexity and resource strain of building custom ASIC's is an excellent argument for Marvell's custom business.
Building a custom ASIC SoC is not a small investment. It takes a large amount of engineering and manufacturing resources to bring a product to fruition. It is hard to put a cost figure on a service like this. The cost ceiling could be endless, depending on the need of the customer.
Kevin O'Buckley, General Manager of the ASIC Business Unit at Marvell, commented the following regarding pricing of the service, "If I look at the most simple, lowest cost 7-nanometer chip that I've seen an effective sizing for when you look at front-end design resources and verification, design for test, physical design implementation, mask set, you're in for a minimum of a $50 million investment."
With a costly service offering like this, it will be essential for Marvell to remain price competitive compared to bringing a custom ASIC service in house.
It is early to make an accurate assessment of the impact that this new custom ASICs business will have. We likely will not hear from the first customers for another 12 to 18 months. But I see this service as a step in the right direction for Marvell. We have seen AMD succeed in this sort of custom SoC work within the gaming console market with large, long term partners like Sony and Microsoft.
Initially, this looks like the most comprehensive custom ASIC offering currently available. Addressing markets like Automotive, 5G, Enterprise Networking, Aerospace, and Cloud Data Centers are long term, sustainable markets that could offer steady initial customers. It will take a little while to get customer feedback on this new business, but I like it as it sits.
Note: Moor Insights & Strategy writers and editors may have contributed to this article.