About Mike

Mike Buetow is president of the Printed Circuit Engineering Association (pcea.net). He previously was editor-in-chief of Circuits Assembly magazine, the leading publication for electronics manufacturing, and PCD&F, the leading publication for printed circuit design and fabrication. He spent 21 years as vice president and editorial director of UP Media Group, for which he oversaw all editorial and production aspects. He has more than 30 years' experience in the electronics industry, including six years at IPC, an electronics trade association, at which he was a technical projects manager and communications director. He has also held editorial positions at SMT Magazine, community newspapers and in book publishing. He is a graduate of the University of Illinois. Follow Mike on Twitter: @mikebuetow

Dark Cloud

Cloud computing advocates beware: Apple’s cofounder thinks you’re nuts.

Holding forth in Washington last week, Steve (Woz) Wozniak said, ” ‘I really worry about everything going to the cloud. I think it’s going to be horrendous. … With the cloud, you don’t own anything. You already signed it away’ through the legalistic terms of service with a cloud provider that computer users must agree to.”

I will admit to not being familiar with all the various cloud IP agreements. But if the Woz is correct, this does suggest a serious wrinkle for those who see the cloud as a panacea.

New CEO Mitchell Breathing Life in IPC

The early feedback is that new IPC CEO John Mitchell has brought a much-needed breath of fresh air to an organization that had lost its drive and character after 11 years under the previous regime.

Among the early changes include a recognition that IPC has become out of touch with many segments of its membership. Designers were so disenchanted, a group of the Designers Council leaders were preparing to bolt the organization altogether. Fabricators’ antipathy toward IPC is well-documented and may even run deeper, as many smaller and private shops have long since labeled IPC as disinterested in their concerns. Even some assembly equipment suppliers have shared concerns over the standards process and perceived biases toward certain groups.

Much of that is turning around under Mitchell. He has moved quickly to make the rounds of various constituents, and in a departure from his predecessor, has not relied on staff to vet member opinions. He has begun to shed some of the entrenched “lifers” who had alienated too much of the membership to continue in their roles. And he has made clear, according to sources, that the staff focus going forward needs to be on the members, which is a long overdue switch from a decade of “Is It Good for the IPC?”*

Further, he is repositioning the organization to better reflect the way the industry is structured. One new division is simply called Member Success, which he describes as a group of functions (membership, member support, events and industry councils and market research) “focused on helping our members be more successful and taking an active role in helping them more fully benefit from their IPC membership.” Most of these areas had grown stagnant to the point of calcification. One of the problems many had identified with IPC is that it existed as much (or more) to ensure its own success but had lost its vision on how to improve members’ profitability. Recognizing that the onus needs to be on IPC to help its members (and not the other way around) is a long overdue and welcome shot in the arm.

Dave Torp, whom many feel is a talented but marginalized asset, is now clearly in charge of the technology and training programs, a role where his background in engineering at Rockwell Collins and sales and marketing at Kester will truly help him excel.

There is a renewed interest in Public Policy, which will in the future coordinate with Brussels and Beijing (and perhaps other key spots). IPC plans hire a new vice president for this space, a sign that it needs fresh input and energy if it plans on making a difference with the legislative branch.

Mitchell seems highly motivated to invest in IPC’s international operations, a space where the trade group’s board had been critical of the previous president for moving at a glacial pace. To that end, IPC is casting about for a president of its China organization, a smart move and a tacit nod that in Asia, titles mean something, and the approach of using a middle manager with no real authority was not working. It says here that if vice president Dave Bergman stays on, he should move to Shanghai, where his experience at IPC (30 years) could better be put to use.

One very smart move was to create a Special Projects function, which allows IPC to look at new or short-term initiatives without distracting staff from the core functions.” We see this as wise because new projects often either sap all the attention and resources from important but functioning efforts, thus potentially leaving those programs to wither, or vice versa, attending to existing programs can act as a excuse for letting new efforts simply dangle. Mitchell has brought on a former colleague named Ed Trackman to run this area.

IPC holds a critical place in the electronics supply chain, but that spot had slowly been eroding over the years. It’s early, and the proof will be in the results, but based on several conversations with IPC members who are much happier today than I’ve seen them in years, Mitchell appears the right person for the job.

*With apologies to Office Space.

India Goes Dark

Some 300 million Indians are without power today as no fewer than six states there lost power for an extended period of time. Add this to the growing list of recent potential and real supply-chain disruptions. There are at least 80 EMS companies affected by the outages, based on the number of entries in the CIRCUITS ASSEMBLY Directory of EMS Companies.

While the extended length of this weekend’s outage was an exception, according to Reuters, “blackouts lasting up to eight hours a day are frequent in much of the country.”

This is not to say that companies shouldn’t manufacture in India. However, the national power concerns should be a consideration for those who choose to put all their eggs in one (offshore) basket. Spread the risk.

 

 

 

Welcome, New Readers

Today we start welcoming readers from another blog we run called Laying It Out. We’ve imported the blog posts from the past several years to this site, and readers are able to sort all the old (and new) postings from Laying It Out by Pete Waddell, Judy Warner and myself by clicking on the Laying It Out category.

Why the switch? We’ve realized that many readers were using both blogs because some of the content on the Hot Wires blog overlapped quite a bit with the design and fabrication segment (Duane Benson, I’m looking at you!). Merging all the content into one space should save all of us some time each day.

Thanks for reading!

No Rest for EMS

Look out Apple — Foxconn is encroaching on your turf.

The company, which already boasts a chain of retail outlets, plans to expand into everything from software apps to a broadband satellite network. Much like Verizon, Comcast and others in the US, the EMS firm is working with local municipalities to build out the network.

Moreover, it has big plans to develop apps for smartphones, tablets and TV.

EMS companies don’t stand still. They can’t make money making solder joints. OEMs that want to protect their future should reconsider the extent to which they should be enabling  their suppliers.

Another Tidal Wave Hits Japan

Old friend Dominque Numakura comes back from the annual JPCA Show with a stunning announcement: Japan’s PCB industry seems to be on life support.

From a series of dull presentations to the outsourcing of manufacturing to a general lack of optimism, the mood is dour, Numakura says. More ominous, some veterans are comparing the trend to the decimation of the US PCB industry in late 2001.

As late as 2000, the US and Japan were neck-and-neck in annual PCB sales, with the US dominating the large board space and Japan leading in HDI. Despite the problems experienced in the US, Japan continued to be the technology leader in PCBs, leading some to surmise that its vast investment and wise decisions on which technologies to focus on made Japan impervious to the cost pressures that sunk the North American industry. Numakura’s essay suggest that’s not the case, leaving one to wonder what this means for the circuit board industry for the coming decade.

Cracks in the BRIC

BRIC is the acronym that stands for Brazil, Russia, India and China. Those four nations are seen as most significant of the emerging industrial economies.

They are also learning each other’s tricks — and fast.

China has long insisted that MNCs that want to win cash-rich contracts to build out that nation’s infrastructure come prepared to share that technology with its local contractors. Call it mandatory tech transfer.

Well, Brazil, it appears, is taking the same approach. The country, reports the Wall Street Journal, is holding back more than a billion dollars in financing until  Foxconn International Holdings agrees to bring its latest LCD technology to its planned factory in Minas Gerais.

All’s fair in love and trade, I suppose.

 

Apple: OEM Again?

We tend to think of Apple the company as a design innovator and a great marketer. What we don’t think of Apple as is a manufacturer.

We should.

Per its 10-K, Apple ran up a tab of some $4.6 billion in capital expenditures in 2011, of which no less than $4 billion was for manufacturing and tooling. Keep in mind that this is a company that has no manufacturing facilities.

Apple went from a traditional OEM to a design/marketing company to one that owns everything from chip design to effectively owning the plants that build its products. It’s an OEM again.

So sure, Apple and Foxconn are tied at the hip. But the 10-K gives us a better glimpse as to why: Apple owns the lines. It’s one thing to move a program. It’s another to replace a factory, especially one with a hundred thousand workers.

Apple is the most valuable company in the world. It dominates its supply chain like no other. Sooner or later, the rest of the industry will copy its methods. The OEM as manufacturer will be back in vogue.

Litigation: The Next Killer Ap?

Apple v. Samsung.

Cisco v. Tivo.

The EU v. Intel.

The lawsuits are piling up as tech heavies line up against each other and, in some cases, nations or even larger economic blocs.

If you are a market share leader, fending off (or filing) lawsuits is routine.

Apple claimed a victory in the US, where courts have banned Samsung’s Nexus smartphone and Galaxy Tab 10.1 after Apple complained of patent infringement. But Apple’s record on (in?) its home court hasn’t extended abroad. British courts have ruled HTC’s mobile devices did not infringe four of Apple’s touchscreen patents, China courts found for a nearly bankrupt company that claimed ownership of the iPad trademark, and Italian regulators have opened hearings over the company’s failure to meet domestic warranty laws.

As companies sue and countersue over technology that becomes ever more complicated, not only are the courts tied up by the endless legal maneuvering, but company engineers get dragged into the fray as well.

So too, it should be mentioned, do governments. But while the US debates measures that would ramp its anti-counterfeiting laws, Europe is taking the opposite approach. The European Parliament yesterday overwhelmingly rejected adoption of the Anti-Counterfeiting Trade Agreement, siding with critics who claimed the bill put too much power in the hands of bureaucrats. “With companies trying to gain any advantage within a fiercely competitive landscape, an increasingly litigious environment seems to be becoming a reality most companies need to get comfortable with going forward,” opined Sherri Scribner, a senior analyst with Deutsche Bank.

Still, as tech companies rely as much on the courts as the computer to wage their market share wars, one wonders: Will the next generation of engineers be pressed into battle to design products … or defend them?


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Behind the Sigrity Deal

Cadence’s acquisition of Sigrity, announced yesterday, is a big deal for reasons beyond the technology being acquired.

Sure, it’s great for Cadence to gets its hands on Sigrity’s power and signal integrity tools.

But what this move also underscores is something of a recommitment by Cadence to its printed circuit board software. You’d have to go back years to find the last time Cadence completed a significant deal in the PCB space (I’m not including, of course, the failed 2008 “attempt” to purchase Mentor, which eventually cost then CEO Michael Fister his job.)

Cadence’s PCB revenue jumped in 2011, growing by our estimates roughly 23% year-over-year. That makes it by far the fastest-growing player in the PCB EDA space. How long has it been since they could say that?

Coupled with its aggressive support of the IPC-2581 data transfer format, Cadence is showing a newfound vigor toward protecting and even extending its circuit board design position. Mentor remains a much larger competitor in PCB sales, but there are signs of a shift taking place.