Chip Design

Staying Ahead of the Technology Curve

Harley Feldberg, President, Avnet Electronics Marketing

Importance of Technology

Technology is important to the world…

…Distribution is important to technology

Distribution…In the Center of Technology

Distribution manages the complexity of the technology supply chain delivering value to suppliers and customers.

Original Equipment

Manufacturers

EMS / ODM

Semiconductor

Interconnect

Passive

Electro-mechanical

Manufacturers

Electronics Marketing

Software Vendors

Mass Market Size

Americas16%

EMEA15%

Asia Pacific55%

Japan14%

2011Total $289B

-12%25% 3% 5% 8%

11%

-18%

20% 8%6%

6%

8%

0

50

100

150

200

250

300

350

400

2009 2010 2011 2012 2013 2014

($ b

illi

on

s)

Semiconductors w/o MPUs, DRAMs, or Flash Interconnect, Passives & Electromechanical

$326B8%

$225B-14%

Note: Percentages represent sequential growth rates Sources: Bishop, Electronics Outlook, Fleck, Gartner, iSuppli, Paumanok, (Rev: 10/7/11)

$304B5%

$289B4%$277B

23%

EM Total Available Market

$360B10%

Distribution Mass Market is ~ 25% of the TAM and 90+ % of the customers

Americas 18.0%

EMEA 12.8%Asia

Pacific 53.6%

Japan 15.6%

Semiconductor Design TAM by Region Semiconductor Consumption by Region

The winning formula for components distribution requires strength in both

Americas31.0%

EMEA 14.8%

Asia Pacific 34.8%

Japan 19.5%

Sources: Avnet BIO, Gartner, SIA

2010 2010

Must Be Present Globally

Supplier Collaboration

Global Logistics

MarketExpansion

System Level Solutions

Global Execution

CustomerDevelopment

Addressing The Market Needs

Reaching 100,000+ customers…

Producing a Combined

$3.4 Billionin annual semi

revenue

Resources1000 Field Application

Engineers

ReachProviding more than 30,000

customers with annual design support

ResultsAcquiring more than 45,000

design-wins annually

Avnet Data: As of August 2011

The Demand Creation Opportunity

Greater system complexity is especially challenging for mass market customers

Higher levels of integration

Software is more of the solution

Proliferation of semiconductor content

Global supply chain solutions

The role of distribution has evolved to that of a “trusted advisor” on design chain and supply chain solutions

Distribution’s Role is Changing

Chip Design

The Avnet and ARM Partnership

Mass Market Applications

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

-3% -1% 1% 3% 5% 7% 9% 11%

20

11 R

ev

en

ue

2011-2014 3-year CAGR

Largest & Fastest Growing Applications for Served Semi TAM(Excludes DRAM, Flash & MPU)

Test &Measurement

Home Audio

ConsumerAppliances

Infotainment

LCD TV

Other Consumer

Power Train

Medical Electronics

Bldg & Home Control

LAN Swicthes & Hubs

Mobile Comm

Inf ra

Digital Still Cameras

BarebonesDeskbound

PCs

Military & Civil Aero

Other Wireless Comm

Video Game Consoles

Source: IHS-iSuppli 9/15/11

• Mass Market consists of many different applications• Trend for consumer feature sets are starting to enter the mass market space

Data Processing

Wired Comm

Wireless Comm

Consumer

Automotive

Industrial

Source: iSuppli 9/15/11 (AMFT - Consumption Database)

Memory

Micro-component

General Purpose Logic

ASIC & ASSP

Analog

Discretes

Optical Semi

Sensors & Actuators

0 500 1,000 1,500

($ millions)

2011 Military & Civil Aerospace

Memory

Micro-component

General Purpose

Logic

ASIC & ASSP

Analog

Discretes

Optical Semi

Sensors & Actuators

0 100 200 300 400

($ millions)2011 Energy Generation & Distribution

Memory

Micro-component

General Purpose

Logic

ASIC & ASSP

Analog

Discretes

Optical Semi

Sensors & Actuators

0 500 1,000 1,500

($ millions)

2011 Test & Measurement

Memory

Micro-component

General Purpose

Logic

ASIC & ASSP

Analog

Discretes

Optical Semi

Sensors & Actuators

0 500 1,000 1,500

($ millions)

2011 Building & Home Control

Memory

Micro-component

General Purpose

Logic

ASIC & ASSP

Analog

Discretes

Optical Semi

Sensors & Actuators

0 200 400 600 800 1,000 1,200

($ millions)2011 Automation

Memory

Micro-component

General Purpose

Logic

ASIC & ASSP

Analog

Discretes

Optical Semi

Sensors & Actuators

0 500 1,000 1,500 2,000 2,500 3,000

($ millions)

2011 Medical Electronics

2011 WW Semiconductor Consumption by Industrial Application & Device Type

Micro-components Remain Important

ARM Architecture Becoming a Leader

Source: EETimes 2011 Embedded Market Study

Survey Question:

Partial Vendor Listing From Connected Community

Actel, Altera, Analog Devices, Atmel, Avago, Broadcom, Cavium, Cirrus Logic, Conexant, Cypress, Energy Micro, Freescale, Fujtisu, Infineon, Intel, IBM, Marvell,

Micrel, Microsoft, Microsemi, Mindspeed, NEC, NXP, Oki, Spansion, ST, Texas Instruments, Toshiba, Zilog, Xilinx

Sales & Technical

Resources

Design Centers

Design Tools

Customer Education

Web Solutions

Global Logistic, Supply Chain, & Value Added Services

Customers

Suppliers

Why The Partnership Works

Collaborating With Our Mutual Partners

10,000 registrants with 7,000 engineers trained

+64% active with a new project or product re-design

Top 8 market segments identified by registrants

RF / Wireless Communications

Industrial & Manufacturing Control

Computer Hardware

Medical/Dental

Military/Aerospace

Network Connectivity

Automotive

Multimedia Systems

Customer Q&A In IrvineHands-On Demo In MunichKeil Overview in ShenzhenARM Education In Moscow+900 Attendees In BeijingTop Self Identified Job Function:

Software Engineer

The Next Step Develops

Education & Awareness

Silicon is differentiated by software

Who writes the software? Large OEM customer: Large software staff Mass Market customer:

Small engineering team May not be global Make vs. buy decision

What is the answer?

Software, A New Opportunity

A marketplace, developed by Avnet and ARM, to drive innovation in embedded software enabling complete

silicon solutions.Visit us at:

www.embeddedsoftwarestore.com

A New Marketplace

Thank You