Business Models

Over the last two decades, the semiconductor industry has undergone several transformations to improve its cost structure and profitability. The industry has evolved from the IDM (Integrated Device Manufacturer) model to pure-play foundry, fabless, and IP-provider (chipless) business models. Organizations that once performed every step of the chip-making process, from IP development to design, manufacturing, and testing, began to increasingly subcontract their business processes. These structural changes had a dramatic impact on the efficiency of the semiconductor value chain system, hampering margins and profits.

We serve both markets that have high level security constraints as well as very large volumes requiring to be very competitive like SmartCard chips.

To overcome these market transformations and business constraintes, StarChip® has worked closely with customers, foundries, and backend subcontractors to reconfigure and improve the efficiency of the value chain. The result is reduced costs, greater business agility, and a higher profit margin for all participants. By redistributing tasks to align more closely with the current semiconductor market, we can better control cost drivers and achieve a competitive advantage—for ourselves and our customers. We offer to our customers flexibility by giving them the opportunity to select the business model: Fabless model or Product Provider model depending on customers volumes and strategies.

Reconfiguring the Value Chain: Product Provider Business Model

This new “Product Provider” business model enables our customers to dramatically reduce costs by licensing products qualified for mass production from StarChip® and placing orders directly to the foundry.
Unlike the IP Provider model, which licenses IP blocks for integration into the chip design, our Product Provider model licenses products that are fully qualified for mass production. StarChip® has worked closely with all members of the chain value system (Foundry, Assembly and Testing, and OEM), to establish a three-party agreement to manage this innovative model:

This three-party agreement provides OEMs access to StarChip®’s proven silicon products and support team, as well as a broad range of cost-competitive foundries.

Three Party Model

Product Development

Delivering Measurable Benefits to Customers

The groundbreaking “Product Provider” business model redefines relationships and redistributes tasks, to enable our customers to achieve a variety of business benefits. Customers can achieve better visibility and control over:

  • Cost drivers and margin
  • Logistics chain
  • Product lifecycle (EOL, shrink)

StarChip® offers a broad portfolio of products that are ready for customers to license, then order from qualified foundries. We also offer Product Cost Analysis services, including a detailed evaluation of silicon cost factors, test and packaging costs, and business model benchmarking. These in-depth analysis services demonstrate how you can benefit from our business model, and can form the basis of a Product Development Partnership.