Paul Bentley, director of sales and marketing for Cypress Semiconductor in Europe talks to EW about the chip firm's SRAM and pSoC technology, and solar power.
EW: Having got out of MRAM, into which non-volatile memory technologies is Cypress pursuing R&D?
Paul Bentley: We have introduced non-volatile SRAM devices, which replace battery-backed SRAMs with easier design and reduced board space, cost and power. We also are continuing work on our SONOS process used in products such as PSoC. SONOS gives us a high-performance, non-volatile process that provides outstanding reliability and integration. SONOS, for example, enables current and future products such as integrated PSoC and WirelessUSB (PRoC) and non-volatile PSoC products.
EW: On the lists of potential takeover targets of private equity funds, Cypress usually figures. Does Cypress feel these funds have anything to contribute to Cypress?
Paul Bentley: In October of 2006, we completed a review of strategic options relative to our market valuations. We concluded that we could deliver more value to our customers and to our stockholders by continuing on our current path.
EW: One of your CEO’s quotes is “real men have fabs.” Have you changed your mind on that in light of your recent collaboration with Grace Semiconductor in China?
Paul Bentley: Cypress still gets tremendous value from owning and operating our own manufacturing operations. However, changes have made outsourcing some of our manufacturing attractive. One of these changes is a shift in focus from a communications company to a programmable solutions company, where we are now servicing the consumer market much more than in the past. This means we need on occasion to meet relatively brief but steep peaks in demand. It’s more efficient to meet these peaks by using a foundry than by building our own excess manufacturing capacity. The second big change is that for the first time we can get wafers from a foundry at a price that is comparable to our own costs.
EW: Is Cypress interested in the solar power market?
Paul Bentley: We are not only interested, but we are already a major player. Our SunPower subsidiary had revenues in 2006 of more than $230m, and they continue to grow rapidly. We also recently completed the acquisition of PowerLight, a leading integrator of solar-power installations. The acquisition allows us to deliver faster solar system innovation to our customers as we execute our plan to reduce the installed cost of a solar system by half over the next five years.
EW: You have recently divested PC clocks and network search engines, and have spoken openly about exiting the pSRAM and consumer imaging markets. What prompted these moves, and how do you expect to replace the revenue from these businesses?
Paul Bentley: As I said earlier, we are transitioning into a programmable solutions provider. These businesses are not compatible with that direction. We expect growth to come as a result of our PSoC products continuing to penetrate numerous markets, as well as innovative solutions such as our newly announced West Bridge family of peripheral controllers for mobile handsets.