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This same problem – the trap of commoditisation and the difficulty of achieving valuable differentiation – can apply to the use of production-ready reference designs. But when using a reference design, the OEM does have the option to add significant customisations in- house. Reference designs also require a varying amount of integration and refinement, including the need to test against the whole gamut of regional specifications in relation to safety, electro-magnetic interference, radio spectrum usage and so on. The experience of enhancing, testing and refining reference designs can serve the OEM well when it comes to the design and development of future generations of product. In any case, giant OEMs enjoy a huge development cost subsidy whenever a semiconductor supplier creates and implements a reference design for them. But is this trend, of suppliers providing
more and more system-level products and IP, a benefit or a threat to small and medium-sized OEMs? It should be said that reference designs are aimed only at very high-volume markets. So when a previously low-key market suddenly comes under the spotlight of the semiconductor companies – smart energy meters is a good example – reference designs can appear extremely threatening: they commoditise products on which smaller manufacturers previously enjoyed decent margins from the application of proprietary technology. A less obvious danger arises when a reference design created for a high-volume market can be applied easily to end products in a different, lower- volume market. This dramatically lowers the barrier to entry to this market, potentially exposing the OEMs in it to unexpected new competition enjoying low product-development costs. If you operate in a market not
threatened by reference designs, on the other hand, the risk is different – having to absorb the full cost of developing products from the ground up with no help. This is
where the general purpose, modular
development tools such as Future-Blox boards or Freescale’s Tower modules can be commercial life-savers. Since they are not application-specific, they can be used by OEMs across a wide range of end products. They provide a commonly-used set of
core components (such as microcontrollers), peripherals and interfaces. This means that a basic hardware template exists on Day One of a design project: OEMs that use the Gerber design files (freely available for Future-Blox boards) reduce the amount of original hardware design they need to do; and they also have a platform on which to develop software from the very beginning of a project, thus reducing time to market. OEMs cannot hold back the tide of
progress: over time, suppliers will offer more and more IP and system solutions, not less. While the vast majority of OEMs cannot directly use the market-ready reference designs developed by semiconductor suppliers, modular development boards provide an important time- and cost-saving tool for the hundreds of lower-volume applications being developed today.
Future Electronics |
www.futurelectronics.com
Colin Weaving is Technical Director, Future Electronics (EMEA)
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www.abcomponents.co.uk Components in Electronics
October 2011 19
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