Overcoming Technological Challenges in the PCB Industry

Matt Kelly is the  Chief Technologist at IPC. In this episode we will discuss all about the technological challenges the industry is facing. Matt will help us understand the “ecosystem” involving the semiconductor industry, advanced packaging, and IC substrates.

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Show Highlights:

• Matt Kelly’s role as the Chief Technologist at IPC
• The Moore's Law is continuing, but it is economically becoming difficult to maintain, this has become the driving force behind heterogeneous integration 
• What does the CHIPS Act really mean for manufacturers?
• Production of semiconductors is an expensive business–one fabrication infrastructure can cost an average of 20 billion dollars
• Matt stresses the need in the industry to use, and understand the “ecosystem” involving the semiconductor industry, advanced packaging, and IC substrates
• The US has a 20-year market leader, knowhow gap, weak sub-tier supply, skilled workforce shortage, and lack of raw materials
• The industry needs to spend time looking at the big picture, take the bigger messages, and convert them into actual change
• A significant shift in the workforce–PCB designers are a scarce commodity. In the near future, printed circuit board designers may have to double as IC substrate designers
• The global supply chain is alive and well, a change to a regional and global mindset is necessary to overcome most of the industry challenges
  • Matt shares the same scenario with produce shoppers in the summertime, you try to buy your fresh fruits and vegetables locally from your local farmers or whatever, but yet you still go to the grocery store
• IPC’s focus is on increasing workforce skills development in the areas of design and assembly
  • IPC is sponsoring the Advanced Packaging Symposium, Building the Substrate and Packaging Assembly Ecosystem in Washington, DC, on October 11th and 12th

Links and Resources:

Follow Matt Kelly on LinkedIn
Learn more about the IPC’s Advanced Packaging Symposium, Building the Substrate and Packaging Assembly Ecosystem
Watch related podcast episode:
    The Benefits of Diversifying PCB Industry Supply Chain
    IPC CEO John Mitchell on the Supporting American Printed Circuit Boards Act
    What is in the PCB Bill?
Connect with Zach on LinkedIn

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Transcript:

Matt Kelly:

I'm wondering if we're now seeing a change in that thinking, or if we need to instill a thinking change to a regional plus global model. What that does, again in my examples, is in the summertime, you try to buy your fresh fruits and vegetables locally from your local farmers or whatever, but yet you still go to the grocery store.

Zach Peterson:

Hello everyone, and welcome to the Altium OnTrack Podcast. I am your host, Zach Peterson, and today I'll be talking with Matt Kelly, Chief Technologist of IPC. If you've followed the news lately, especially around the CHIPS Act, you'll know that a lot of industry groups have been involved in making this particular piece of legislation a reality here in the US, and the IPC is, of course, one of the industry groups that has worked on pushing that forward. Also, they have worked quite diligently over the years to develop standards, and of course, educational material for designers. Matt Kelly, thank you so much for joining us.

Matt Kelly:

Thanks for having me.

Zach Peterson:

Yeah, absolutely. It's always great to talk directly with folks from IPC about what's going on in the industry, because you guys are so foundational to so much that we do. I think most people are familiar with IPC in terms of standards, so probably as an alpha numeric code, IPC dash some numbers. But I think there's a lot more that you guys do. We've talked with John Mitchell recently about some of the things that IPC does, but maybe you could tell us a little bit about what you do specifically for IPC.
 

Matt Kelly:
 

Yeah, it's a great question. I guess I'm behind the scenes, if you will. One of the things as chief technologist that I remind myself daily is making sure that we're working on the right technologies and looking forward for our members in the industry. What does that mean? It means that, especially in today's world, there's so much noise. You don't have to look very far to see all the change that is happening around us. Essentially, at IPC, I manage our solutions team, and what we're always doing is looking for those next generation technologies that our members want, and starting to see what kinds of elements IPC can do to help out with.

I spend a lot of time with our advocacy group and government relations. That's what most of them, we'll get into this, I think, in the conversation, most of what we've been doing with the CHIPS Act interfacing with government, with NIST, Department of Commerce, Department of Defense, on behalf of the industry, so it's an industry voice. We have standards, which you mentioned. We have education and training, as well. There's many different aspects and the events that people attend, as well. My job is to make sure we're working on the right things and it's really exciting times, if I may say.

Zach Peterson:

In terms of the objectively right technology, I'll use air quotes there, but in terms of the technology that you guys work on, I'm sure this is driven both at the chip level, and then at the assembly level, of course, by Moore's Law. It seems like over the past decade, we always get to a hump and then someone says, "Will we ever get over the next hump of Moore's Law?" And we always manage to find a way to get to the next node. How has that approach changed over the years, and how has maybe how we think about Moore's Law changed over the years?

Matt Kelly:
 

Yeah, great question. Moore's Law is really just a doubling effect over a certain period of time. When it was first proposed, it was doubling of the number of transistors in a single year. For most of the lineage, it's been every two years. Now what we're seeing is that we're not even able to keep up with that. So the first message I want to say is that Moore's Law is continuing, but it is economically becoming more and more difficult. The investment with masks and things like that to produce a node is just not making economic sense right now.

The real exciting part of what's happening right now, and I'm actually at an industry conference right now, I'm calling in from a university here, and it was said just within the last hour that this is a once in a generation opportunity with chips funding and with the focus that's happening right now. The fact that Moore's Law is getting more and more difficult to maintain is really the driving force behind heterogeneous integration and what you'll hear is chiplet integration and chiplet architectures.

Zach Peterson:

It sounds like you're drawing a parallel between the drive for heterogeneous integration, which is not necessarily a new thing and an opportunity by manufacturers maybe in the US, or North America more broadly, to maybe take more ownership of those technologies and increase their level of expertise in those technologies to produce new products. Is that one of the central things that I think the CHIPS Act really means for manufacturers?

Matt Kelly:

Well, the adoption of heterogeneous integration techniques like chiplet architectures is really trying to overcome some of the barriers that are in front of us by just simply following the next node reduction. That's what's really exciting is that we're now thinking about and practicing, there are companies that are already doing this, where we're actually putting various levels of technology, different chip nodes, closer together on a single chip, system and package, system on a chip, those kinds of things.

There's a lot of functional benefits that are coming with that. On the technology side, the driving force is to try and gain those efficiencies and gain that productivity to produce the chips and the devices, but on the product side, you don't have to look very far other than the cell phone on your desk, where we're really just talking about increased functionality. We're trying to put so many different functions into single devices, couple that with miniaturization and all these other forces, there's really a good three or four things that are all happening here, which is really the reason why architecture of chiplet design is really now starting to take hold.

Zach Peterson:

Well, one thing I've wondered about this is how this affects the competitive marketplace, not just for the manufacturers, but even for the folks that are producing those individual chiplets. I've even wondered if we're ever going to see a marketplace just for the chiplets where you now have companies that are just designing the substrates. They can take chiplets from multiple vendors and then they put it all together in a custom package. I'm wondering, not just how the competitive marketplace changes for the manufacturers doing advanced packaging, but also what happens in the future with the semiconductor marketplace?

Matt Kelly:

Yeah, that is a good question. I don't quite necessarily see it like that. Production of semiconductors is a very expensive business. A single fab, you're seeing them being built right now in the southwest United States, one fab is on the order of 20 billion dollars, so it's not like people are just going to go ahead and start fabricating chiplets because of these new opportunities. There's a tremendous amount of infrastructure that's needed there.

I don't really want to comment too much on that side, but one thing that is absolutely fundamental of the CHIPS Act, we actually just heard from Frank Gail this morning here at the conference, where the intent of the CHIPS Act funding is to enable an open ecosystem and to allow small to medium size enterprises that may not be doing things to do these types of tech technologies and service it that way.

I think that's great, but I do want to add a very big air of caution is that there is a lot of technological challenge here on the design front, on the standardization front, just getting chips to talk, even just the standards and the protocols that we're dreaming up at this point are not ubiquitous. They're still very much in early days and there's still a lot of unknown. The underlying theme of this is to allow people that aren't necessarily doing this primarily in geographies like North America or Europe, where some of the deficiencies have been escalated over recent months, including COVID, it is meant to do that but I think that as we're finding out, it's going to be a very difficult road, make no mistake. There there's a lot of challenges here.

Zach Peterson:
 

I'm hearing a couple of things here. First, it sounds like North America's share of advanced packaging is not very large and so of course, getting into that and nudging the industry along with something like the CHIPS Act is going to maybe promote more production of those advanced packages and semiconductors, but I'm also wondering how does this affect the barrier to entry because you said smaller and medium sized businesses, I suppose, could now have a chance to get into this area of technology?
 

Matt Kelly:

Well, the intent of this is to reduce the barriers of entry and so I think there's going to be companies and I'll give an example on substrates. A lot of discussion is around the silicon and the semiconductor. What we're really trying to really make sure of, especially with IPC, is that everyone, a lot of people are using this term, the ecosystem, and I'll put that in air quotes. It's on people's radar and it's kind of on paper, but we need to make sure that actually gets put into practice.

By that I mean, and I'll use the substrate example, so there are right now HDI printed circuit board fabricators that can build more and more advanced structures every day. When you look at lines and spaces or build up or using different types of film technologies, that space is now actually approaching some of the albeit low end of IC substrate, but it's now starting to enter the IC substrate technological space. Because of that, a PCB fabricator might be interested in entering into the IC substrate market. We're seeing several companies wanting to do that. Again, we are very supportive of that, but again, I always as an engineer and a technologist myself is be aware. There are some major technological challenges that need to be overcome, but that's the hard work that's in front of us.

That's just one example. The other one that I can give you is on the assembly side. There are EMS providers that build sub-system level final finished printed circuit boards with system mechanicals. They are showing interest in also entering into the OSAT space where they would be instead of producing a final printed circuit board assembly, they would be producing a non-electronic component as an individual product. Those are two examples I can cite.

Zach Peterson:
 

Well, you had mentioned in IPC's North American advanced packaging ecosystem gap analysis, you had stated that there is almost no capability in the United States to produce some of the most advanced IC substrates. You just mentioned, getting back to the quote for a second, you just mentioned that some companies want to get into this market. You also mentioned that the US has a 20 year market leader, knowhow gap, weak sub-tier supply, skilled workforce shortage, and lack of raw materials. Given all of those challenges, I mean, that's a long list of issues here, what is it going to take for US industry to overcome that?

Matt Kelly:

It is daunting and at a conference like this, that I'm at right now, it's hard not to get overwhelmed. One of my key pieces of recommendation follows. Number one, and to your listeners, spend time understanding the bigger picture. There's a lot of importance in the macro economic factors. It drives your businesses. It highlights the need for sustainability. So understand those, I'll call it the Picasso painting, we need to understand the big picture of what's going on.

I spend a tremendous amount of time deciphering and digesting all of the things that are going on, but when you bring that back to your company, and I'm assuming I'll have some people kind of disagree with this, but I recommend purposely being a little bit myopic. Put some blinders on a little bit and be focused and deliberate in terms of what you can do to help solve even just a piece of the bigger puzzle. Because if you don't, and we're seeing this in some of the coalitions that we're a part of, is that you can get lost very, very easily. Even though we have the scale gap, and this is a 20 year decay problem. This is a very difficult problem, make no mistake. This will not be solved in five years. This may not even be solved in 10 years. But despite those facts, we need to be very deliberate in the actions that we take, especially as we come back to the companies.

Zach Peterson:

You accept that these are of course, very long term challenges and I get that. Just a couple of follow ups about that, so just recently I had spoken with Blake Moore who, as you know, is one of the co-sponsors of the PCB Act, Supporting American Printed Circuit Boards Act. I had asked him if he is content and possibly if other lawmakers are content to allow the industry to show its resolve and allow governments to essentially nudge the industry along with incentives and investment, rather than jumping in and taking or creating full scale national policy around those types of issues.

Given that that is possibly going to be the approach in the US and possibly even in Europe, what is the industry's resolve to see all of this through over a five, 10 or 20 year period? Because previously, when I had talked to John Mitchell, he had mentioned that at times the legislative environment would pull you one way and incentivize investment, and then maybe undo some of those incentives through whenever there's like a party change, let's say, and some of those might get repealed. It seems like there's some volatility in terms of the environment, or at least the investment environment for these companies who have to look out over a five or a 10 or 20 year period. I think it's difficult for maybe a smaller company that wants to get into say the advanced packaging market to determine whether or not this is actually going to pay off for them over a reasonable amount of time. What would you say to those companies?

Matt Kelly:

Well, first your comment is spot on and it's exactly the main reason for the reluctance of companies just flooding into this. 52 billion dollars is a heck of a lot of money and you're still seeing a lot of reserve. This is no different than lots of other examples. We can talk about the solar market kind of back in the nineties as well, but the dangerous part of this is a propped up market. Having the health of the region or the company, or whatever the definition of what you're measuring solely propped up by government investment subsidy alone, we generally know what happens. When the subsidies end, the prosperity ends or the money dries up and it's difficult. The really hard part about this is the word sustainable, it's making a sustainable change.

That's what, again, here at the conference we're talking about today is how do we take these bigger messages of, we need to do things, there're these deficiencies, we've let this go for 20 years, but now converting that into actual change and to actual action in the company and to have it sustainable so that you have a business in five years or 10 years time. I think that the incentives are needed. Imagine if that didn't get signed. This is great news. The message that we have, as well, it's amazing. While 52 billion dollars is a lot of money, it's actually not a lot of money at 20 billion dollars for one fab, and that's just one piece of the ecosystem.

Some of our messaging going forward through our advocacy effort is thank you, this is a great first step. It will enable big companies, small companies to really now start to have a funding source to start to do some of these things and learn and kind of build, but this is really just the beginning of a long runway, if we're really serious about this. We're not just saying we need more government money, it's part of it, but it can't just be a one and done.

A great example of that is the bill that's still on the table for printed circuit boards, the printed circuit board allocation. A fear might be that they've just doled out all this money already and maybe have forgotten about these other bills. I think that's dangerous because there's a lot of work that needs to be done in the printed circuit board sector, as well. I think what makes this act really difficult is that word ecosystem. Ecosystem is a really big word, and that's why it's really important to define what the ecosystem is. You have to be able to draw those lines in the sand to basically kind of say where something starts and something finishes so that you can measure success, or you can measure the health over the longer term.

Zach Peterson:

Well, I think that's fair. When you say ecosystem, Travis Kelly, who we just recently had on, CEO of Isola Group, I'm sure as you know, is president of The Printed Circuit Board Association of America. He had brought up some important points around PCB specifically, which was that it's not just the fab and assembly shops, it's also the raw materials. It sounds like you assign the same type of thought process to the semiconductor industry, advanced packaging, and IC substrates and things like this.

Matt Kelly:

Absolutely. I mean, if you just dissect the system, you think of a cell phone if you're thinking about this as you're listening, and you kind of like reverse engineer this, so you start with your phone and you dismantle it. There's mechanical parts, there're electronic parts, there's a printed circuit board, and you keep going through that whole process, eventually you'll get to materials, you'll get to equipment and you'll get to people. We should talk about people at some point because it's all of those underlying things and design, there's a series of underlying enablers that need to be brought into the discussion, need to be funded and need to be moved forward in the technology realm, as well.

Zach Peterson: 

You brought up something interesting here, which is actually something that I've contemplated quite a bit, which is the design side of all of this. Printed circuit board designers are already going to be a scarce commodity coming up soon when we start to see a wave of retirements, but I wonder is that even going to be exacerbated when it comes to IC substrate designers? Are printed circuit board designers going to have to now double as IC substrate designers? Because conceptually, if you look at the structure of some of these interposers and some of these packages, you might say that some of those same skills might be needed on the circuit board, as well as on the IC substrate. Do you see it that way?
 

Matt Kelly: 

Absolutely. The number one problem in all of this, and I love technology, there's a lot of challenges to talk about and overcome, but actually when you look at this, the number one problem that we're faced with is workforce. It's the skilled people that need to do a whole wide variety of jobs and this is not just about engineers or scientists or PhD level, there're technicians, there're operators, there's a whole gamut of knowhow that is needed.

Back to your question specifically about designers, while North America still holds much of the design IP, we know this very well, there's been a lot of outsourcing if you will, of physical design or at least if you get past your core architecture, then there's a point where you finish off the design elsewhere. I think that's very much the same problem we're going to have for IC substrates. The short answer to your question is, yes, I think it's a big skills gap area.

Remember too, if we're trying to push the envelope, we're not only asking people to design in a slightly different realm, instead of mills, they'll be talking about microns and kind of different tolerances and design rules and different types of software stack challenges that they'll have, but now we're actually asking them to push the envelope and do something that they've never done before with these new chip architectures. So yeah, it's going to be a really big challenge. It's why you're going to see more and more... My prediction, if I put my prediction hat on for a minute is we're only a month after this CHIPS Act has been signed, within this next six months you're going to see a significant shift in conversation to workforce.

Zach Peterson:
 

Well, I would hope so. Part of the reason for that is at least in North America, I just wonder if there's even enough people to just pursue great ideas. I had asked Blake Moore, just going back to my previous conversation with the Congressman, but I had asked him, what can industry do to try and develop the workforce? Is it groups of companies within the industry have to come together? Is this just something that the government has to prioritize? Is it all of the above? Do we need more immigration? What can the industry do to try and strengthen itself? Because I think this is an important part of strengthening the industry is having that robust workforce locally, as well as outsourcing. I'm not saying that everything has to be done locally and everything should be outsourced, but you have to find that happy medium, where everybody meets in the middle. What are your thoughts on what the industry can do to try and continually develop the workforce and push the skill level up so that we can be competitive, and so that we can design all of this stuff successfully?

Matt Kelly: 

Two parts to that I would say, first and foremost is we need to be really practical about what's happening here. The global supply chain is alive and well, make no mistake. There are some things that cannot and will not move and will never move from where they're currently being built right now. Great example I like to use are capacitors and resistors. While we're talking about really advanced semiconductors and logic and memory and all these really high powered devices, on some products, there's 10,000 passes on a card, chips and capacitors and resistors that can bring down a system too. They might be produced, I won't name names, but they're produced in Southeast Asia or somewhere else globally. They are not moving. You're not going to move that technology, but really important at a system level. That's an example of where, as this reality of chiplet architecture starts to take hold, one way I use to describe this is, and I was brought up in the global supply chain, global supply chain partners, horizontal do what you need to do.

I'm wondering if we're now seeing a change in that thinking, or if we need to instill a thinking change to a regional plus global model. What that does, again in my examples, is in the summertime, you try to buy your fresh fruits and vegetables locally from your local farmers or whatever, but yet you still go to the grocery store. It's that kind of an example where if we can start to get our heads around and actually operate at a regional plus global model, then for those things that need to be global and that's the way it's going to be, so be it. If there are some really important things for security, for resiliency, for intellectual property or whatever the reason is, it's a subset of that. It might likely cost more than what you could get it elsewhere in the world, but you're doing it for good reason.

If we look at it at a regional plus global model, it allows you to have those conversations. I'm not saying that's what's going to happen, but as a thought experiment, that's what you can actually start to talk about. Because if you don't do that, the very first thing that comes up is cost. If I'm going to move it to a region to have something produced and it doesn't cost the same amount or less, I can't do it, the discussion's over. If you see the difference again, it's kind of more strategic thinking.

Zach Peterson:

What about industry? What can industry do for the design side to build up that skilled workforce? Is this a partnership with academia? Do governments in some of these markets need to be involved, whether it's the US or Europe or somewhere else? Do the companies in the industry really need to take a much more active role in terms of training and educational resources and things like this? Because at Altium, we have the Altium education program, but personally I think it's a drop in the bucket because there's so much beyond just CAD tools when it comes to design.

Matt Kelly:

The other point that I would make is the role that academic learning and training can play and commercial learning and training can play. On the academic side, of course, people enrolled in science and engineering, STEM programs, all those types of things that are happening, really try to get people excited about manufacturing again or for the first time. I mean they don't realize that it's come and gone. I think you're seeing a lot of focus on the academic side for degrees, for certificates and to get people prepared to enter into the workforce, so that's the first area.

The second area is on the commercial side, like what you had mentioned with your Altium tool designer course. There are people that now have been trained and need to enter the workforce. They still don't have the actual skills to lay out a board or whatever it is that they're doing and so there's a commercial level of training that is needed, as well. From a design perspective, the various CAD tool providers, I think there's a really good opportunity for that actual specific tool training.

At an industry level like at IPC, we're really focused on increasing our skills and workforce development programs in the areas of design assembly test for OSAT, for assembly for printed circuit boards, for all these different areas. A little bit of a long answer, but I mean there's no shortage. That's what I said earlier is that the real problem is people. That's what this really is about.

Zach Peterson:

Speaking of educational resources for designers and I think for anyone else who's operating in industry or for anyone who is just interested in all of this, there is an upcoming event that IPC is hosting or sponsoring, which is the Advanced Packaging Symposium. Could you provide some details on this and maybe some of the takeaways for potential attendees?

Matt Kelly:

Yes, certainly. We are just really thrilled to be offering a nice lineup of industry experts and executives from across the industry who will be in Washington, DC, October 11th and 12th. It's entitled our IPC Advanced Packaging Symposium, Building the Substrate and Packaging Assembly Ecosystem. The intent of the symposium is not just to talk. I mentioned earlier in our conversation that there's been a really big title shift in what we need to do, and so this is not just about, these are the things that are important, these are the areas where we need to focus. What this symposium is really intended to do is to punch through those bigger issues that have now been signed by the CHIPS Act bill, but now start to change our thinking and getting into real action.

We have a really nice agenda built. We've got a few things at play here. We've got a top down style agenda where we're talking about some of the... I talked about the castle painting earlier, the macro economic, and the big picture views. We're going to get some latest updates from NIST, the Department of Commerce, the Department of Defense and we'll be drilling down from there.

We have purposely built in commercial and defense speakers throughout the agenda. We know that the defense industry is slightly different than the commercial needs, so that's been built in. Then as I mentioned, we drill in. We go through the electronic components, OEMs, we have printed circuit board fabricators that are looking to get into IC substrates. We have some world leading IC substrate producers, and we have material suppliers. We have some equipment suppliers as well. Just a really nice lineup and just really excited to be holding that. We're already getting a really good response and look to see how that will fare.

Zach Peterson:

Well, I'm a big fan of those types of events and I have often encouraged many designers to take advantage of these types of events, because it's always great to get that information directly from the folks who are on the front lines. Anyone who's interested in the Advanced Packaging Symposium, October 11th and 12th, we will have a link in the show notes, encourage you to go get more information and attend if you can make the time.

I think we're going to leave it there for now. Matt, thank you so much for joining us. This has been very insightful for me, especially as I try to constantly upskill myself and of course learn more about advanced packaging.

Matt Kelly:

You're welcome. Thanks for having me.

Zach Peterson:

Absolutely. To everyone that's been listening, we've been talking with Matt Kelly, Chief Technologist of IPC. Again, I invite you to look at some of the links and resources we have in the show notes so you can learn more, and of course, so that you can learn about the Advanced Packaging Symposium, October 11th and 12th, 2022. Matt Kelly, thank you again so much for joining us and we hope you'll all subscribe to the channel and keep up with all of our updates and last but not least, don't stop learning, stay on track, and we'll see you all next time.