India very important source of talent pool for chip business: MediaTek India head

Semiconductor has created a lot of buzz in India with over Rs 1.5 lakh crore worth of investments announced in the sector in the past around one year. MediaTek is one of the leading global players in designing chips. In a freewheeling chat with DH’s Gyanendra Keshri, MediaTek India Managing Director Anku Jain talks about the company’s expansion plans and the evolving business opportunities in the semiconductor sector in the country.

What is the opportunity you see in the semiconductor sector in India?

There are two parts to the semiconductor industry. One is fables and the other is manufacturing. MediaTek is a global fabless semiconductor company that enables nearly 2 billion connected devices a year and a market leader in developing innovative systems-on-chip (SoC) for mobile devices, home entertainment, connectivity and IoT products. We have many different verticals and for all these verticals we design the chipsets. So this is the fabless part of it. For manufacturing from MediaTek point of view, we rely on our partners who use our chip to design and then manufacture the chipsets. But what I see in India is that recently in the last couple of years, the government of India has given a lot of incentives like PLI schemes and so on. And due to that, we have got multiple units coming up in ATMP (assembly, testing, marking, and packaging) and fab manufacturing.

What makes India's market interesting? Is it the government's incentive or the market?

Actually, there are multiple reasons. If you go back a bit to the COVID times, I think we all faced the issues of chip shortages. There were two reasons. One, the demand shoots up. People started using a lot of electronic products at home and so on. And second, there was a value chain problem. There was a disruption in the value chain and that led to delays in chip manufacturing. So the Indian government realised that this is a strategic sector and it should be developed within the country. From the global point of view there are multiple reasons. One is they don’t want to rely only on certain geographies (China, Taiwan). So the effort is to diversify the manufacturing base. India has emerged as a trusted partner for the global investors. There are several factors. It is democratic country, there is a large market and skill base. A lot of talent pool is available in the country. Global investors are banking on these.

By when do you expect India to become a significant player in the semiconductor sector?

Significant investments have been announced. The joint venture between Tata and Powerchip Semiconductor Manufacturing Corp (PSMC) will start manufacturing with slightly mature node from 28 nm upwards. Eventually I think the companies in India will also try to get into the more advanced nodes like 4 nm, 7 nm and so on. I think it will take a decade or so when really the momentum picks up. But we will see the fruits of it coming in as soon as 1 or 2 years from now. If you ask when we can become a significant part of the global supplies, I would say it will take many years. But we have made a very good start.

What are MediaTek's investment plans in India?

We have been in India for the last 20 years. We founded our first office in Noida in 2004 and we opened a second office in Bengaluru in 2014. We have made significant investments in R&D. Today, we employ over 1,000 engineers. They are working on both hardware and software designs. Over the next few years, we will increase the headcounts with this our investments will also increase. However, we are in the fabless and will remain focused on the fabless business.

What is the difference between fabless and manufacturing business?

Let me talk a bit about how the industry works. One part is designing chipsets. This is called fabless business. This means we don't have a fab. Fab is a factory which makes chips. So fabless means there is no factory involved and there's no manufacturing. MediaTek is purely a fabless company. We don't manufacture anything, we design chipsets. And the second part of this puzzle is manufacturing. The companies like PSMC are into manufacturing. They take design from us and manufacture the chipset. Designing chipset is highly technological work.

What is the expansion plan for MediaTek’s Bengaluru operation?

Right now, we have over 700 engineers working in Bengaluru. We plan to increase it further. For MediaTek, India is very important not only from a market point of view but also from a talent access point of view. The talent pool available in India is really awesome. We want to make use of it. Our R&D centers will keep increasing over time. In Bengaluru we are doing hardware design, chip design as well as software design.