The current round of flu will have lasting repercussions on the electronics industry, whether it turns into the kind of pandemic that killed 50 million to 100 million people in the fall of 1918 or whether it proves to be a localized tragedy. We won’t know that for months, of course. The 1918 flu actually began as a relatively mild illness the previous spring before mutating into one of the worst disasters in modern times.

But no matter what happens with this disease, change will be accelerated. Some sectors will emerge stronger and other will suffer. Electronic medical records and the computers and storage needed to handle them will get a serious boost. Already targeted by the Obama administration as part of the economic stimulus plan, this also should provide needed momentum for at-home testing and electronics and a more robust short-range and long-range communications infrastructure.

Also likely to receive a boost are things like videoconferencing and collaborative work environments. Most people don’t want to get on planes if they don’t have to, and most companies don’t want to risk having their employees travel and possibly infect the rest of their office. That provides a huge impetus to invest in new technology. It can even provide a boost for virtual conferences and trade shows. Intel is experimenting with its own electronic trade show next month with its Embedded eVent. http://www.intelembeddedevent.com/

Sales of more advanced phones with 3G capabilities for Internet access also tend to benefit at times when people need more information more quickly than they can get with a simple phone call. The Internet has become a part of life over the past 14 years, and fear can drive a quest for even more information.

At the same time, International trade can take a serious hit. In March 2003, the World Health Organization declared SARS a pandemic, although several months later the danger subsided. During that time, commerce with much of Asia—and even within Asia—slowed to a crawl. Dock workers were afraid to open containers arriving from countries infected with SARS and much of the Asia economy simply stopped for two months.

The effect of that illness proved something of a wakeup call for contract manufacturers, who realized that having all their plants in one country wasn’t such a good idea. It led to significant manufacturing expansion in places like Eastern Europe and—something that should be noteworthy in this time of swine/bird/human flu—Mexico.

Manufacturing is far less rooted these days than in the past, and many major manufacturers are now hedged against disaster with facilities in multiple countries. But what’s different is they don’t control their supply chain the way Henry Ford once did. Any glitch in the production of key products, such as semiconductor wafers, can have a significant impact on much more than just the price of wafers. It can raise the price of electronics across the board, which has a compounding effect up the electronics hierarchy and into the economy at large.

Likewise, in markets where there is strong competition, a flu epidemic can create a huge disadvantage to one company vs. another if it affects either their supply chain or manufacturing capability.

What do you think will happen?

–Ed Sperling

Consolidation has begun again in the electronics industry, but so far the majority of it is happening at the customer level.

While this is a sign that the economy has bottomed out and credit is beginning to flow—as unevenly as it always does when a downturn bottoms out—it’s creating a rather disturbing trend. Fewer customers mean fewer designs, even though the complexity of the designs is significantly higher.

Broadcom’s bid for Emulex is a case in point. Oracle’s bid for Sun is another. And that’s just the opening salvos for companies with cash in the bank. With stock prices low, they’re going to snap up acquisitions the way real estate speculators have been snapping up foreclosed property.

Customers are always in the position of strength when it comes to negotiating for designs, and that position is even stronger when there are fewer of them. Witness the pressure put on capital equipment makers by the shrinking number of companies with fabs. Even if they sell the same amount of equipment, the margins of equipment makers has been sliding.

The problem at the SoC level is that the complexity is so great that just to recoup system-engineering costs in the design will require enormous volume, as well as some new approaches that rely on modeling, statistical timing and, to a large extent, probability. And while that will open the door for new tools for these models, the overall effect will be to shut the door on many startups because the cost of entry is too high.

In the short term, this is probably not unexpected. But if new markets don’t open up at the same rate as consolidation on the customer and tools level, the entire supply chain will be thrown into imbalance. Gaps may be fun for a few companies when demand exceeds supply, but they tend to create havoc in the market, fueling wider swings both up and down and, at least in the past, inventory imbalances.

Consolidation may be a way of thinning out the competition, but that doesn’t mean it has to progress smoothly.

What do you think?

–Ed Sperling

The latest terminology to permeate the ranks of systems engineers and the makers of automation tools is, ‘What If.’

On the face of it, this concept is a progression from the old matrix model, which provided a set of possible interactions and variables. What it adds, however, is an extra layer of dependencies and interdependencies, a concept that was developed largely in the software development world. And then, of course, systems engineers add their own spin on it, building up complexities like hierarchies of function and how they relate to different power islands and various cores on a chip.

A good way to visualize this is to think of an SoC like a software stack. There are layers of abstraction that are hierarchically arranged, and then there are services that run up and down the entire stack. In the SoC world, though, you have to think of this as a 3D diagram, where you add those dependencies across cores and across functions. By the time you’re done, you’ve got a 3D model of an SoC with lots of services that work across the entire system and others that are localized.

This is basically the approach taken by these virtual models, without the brain-busting attempts to solve this all by hand. You can’t use a spreadsheet or a block diagram anymore because the possibilities are too numerous to figure out by hand and still get the final product to market on time.  You’ve got variations like, What if you did it this way versus another way? What would be the impact on terms of power, performance and area? And what if you sliced down the size and increased the density? Or what if you added another layer above all of this in a stacked die model?

Not all of these pieces are available today, but that’s the general direction. ‘What if’ is no longer just a discussion over a cup of coffee. It’s a critical part of the up-front design process, and an integral part of the design several steps down the line. It’s also part of the software development and the interface discussion. And increasingly it’s part of decisions involving the foundry and the manufacturability of the device.

Engineers have been asking ‘What If’ for years, of course. What’s changed is that the number of possibilities is now to great to figure out by hand.

What do you think? What pieces are still missing from the ‘What if’ modeling tools?

–Ed Sperling

In a rather striking bit of irony, tools for creating semiconductors are able to use multicore architectures just fine. The problems these design tools are trying to solve can be parallelized to the point where simulations and models can be created in hours instead of weeks, or versus months in the case of Excel spreadsheets.

The real question, though, is whether the multicore designs they are creating will be able to run software in parallel. There has been much debate over this subject, in these pages as well as in development labs at Intel and IBM and research universities around the globe. The good news is that work is under way to solve these issues and money is being thrown at the problem like never before. The bad news is there are still arguments about just what is possible and what isn’t.

Personally, I’m not convinced this problem is solvable for most applications—at least not using the conventional approach. Engineers will never think in parallel. They program sequentially, and if functions aren’t obviously redundant then good luck reprogramming the human brain.

But I’m not totally pessimistic, either. Generally when a problem can’t be solved, it’s the interpretation of the problem that’s wrong rather than the lack of a solution.  Find a better way to state the problem—easier said than done—and the answer magically appears.

Unlike hardware, which is defined by physics, software is defined by applied mathematics. Mathematicians are convinced theirs is the only pure science and they usually do figure out things that no one ever thought of, including the answers to some incredibly complex problems. And sometimes they even figure out ways to do it on computers.

But mathematicians don’t always arrive at the answer quickly. Pure science needs to be thought out, tested and re-tested. This is not a process that has worked well under deadlines. In fact, some problems have taken hundreds of years to solve. That could put a whole new wrinkle on the concept of time to market.

–Ed Sperling

The economy appears to have hit bottom. This is good news, but there are caveats.

First of all, not all industries will recover at the same rate. Communications never fully recovered from the dot-com bubble. Anyone who bet big on a communications recovery has either switched careers or retired. Now it looks as if the auto industry will be dragging for some time, and companies that hitched their future to that wagon will be feeling pain for some time. Electric cars are still little more than a second car for the rich and plug-in hybrids are still years from mass production—and in between, no one wants to plunk down a large sum of cash unless they have to.

Second, it also doesn’t mean the economy will recover quickly or that more jobs won’t be eliminated. Jobs are a trailing indicator, and virtually everyone knows someone out of work. That tends to dampen the exuberance to spend money. But system-level design is a leading indicator, if that’s of any comfort. Jobs should return to this industry first, even if they aren’t necessarily in markets that you know or in places that you want to live.

One of the best positive markers is the stock market. It bottomed out at 6520, and it could well plummet again. But with banks paying the lowest interest rates in decades for savings, many people have started returning to the markets. They may be ahead of the overall recovery, but that money can be used to fund business deals and get the economy moving again, which starts an upward cycle again.

Second, the stimulus money will begin filtering into the economy over the next few months, as well. That will add more fuel for businesses to spend money, whether responsibly or not. But at least there will be something to work with.

None of this means the economy will recover quickly. Even if the market goes up, it can seesaw for awhile. But we are seeing some positive signs of change, including predictions from foundries of a better second half and more design exploration that will lead to the purchase of new tools, new equipment and ultimately to tapeouts. The good news is that will leave us all thinking about time-to-market issues again—instead of the markets themselves.

—Ed Sperling