The continuing price hike of overseas semiconductor intellectual property (IP) could force small- and medium-sized IC design houses in South Korea to give up cutting-edge process design, according to an ET News report.

A single IP for micro-processing under 10nm is priced at over KRW 8 billion (US$6.74 million) in some cases, placing large financial burdens on South Korean fabless companies that design semiconductors using multiple IPs, the report suggested. The companies would have no choice but to give up advanced process design if they are unable to attract sufficient investment, said the report.

The IP price of 'SerDes', a high-speed communications technology used in processes under 10nm, is currently ranging between US$5 to $7 million, while the IP price of USB, PCIe interface and SATA storage are ranging between US$1 to $1.3 million, ET News said, adding that the combined prices for IPs needed to design artificial intelligence (AI) semiconductors and automotive application processors (AP) with micro-processes under 10nm often exceed tens of billions of dollars.

Market research firm IBS pointed out that the cost of the entire 28nm process semiconductor design cycle is about $51.3 million and that the price would increase tenfold to US$542.2 million if the 5nm process is used. It added that half of the development cost is spent on software such as IP and electronic design automation (EDA) tools.

Most IC design houses in South Korea still rely on overseas semiconductor IPs and are paying expensive license fees to global IP companies such as ARM and Synopsys. Unlike Qualcomm, Apple and Samsung Electronics, small- and medium-sized IC designers in South Korea have limited funding for developing the next-generation semiconductors. As a result, they are urging the South Korean government to offer support in securing overseas IP licenses and developing domestic IPs with good quality.

By DIGITIMES