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Friday 21 November 2008
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Freescale follows NXP with plan to off-load handset chip business
Friday 3 October 2008
Freescale Semiconductor has said it is looking to sell or place its mobile phone chipset business into a joint venture within months.
The decision to review its involvement in the handset business is part of what Freescale called a plan to “sharpen the company’s strategic focus on growth markets.”
“In support of this targeted approach, the company announced that it will explore strategic options for its cellular handset chipset products business and intends to complete a sale, joint venture agreement or other transformation in the coming months,” said Freescale.
Freescale’s plan has parallels with the decision of NXP, another private equity-owned chip maker, which effectively got out of handset chips earlier this year. NXP put its mobile phone chip business into a joint venture with STMicroelectronics, a venture in which ST has the dominant 80% stake.
The handset market is dominated by two big suppliers, Qualcomm and Texas Instruments, and companies such as Freescale and NXP have recognised that they cannot match the R&D investment of companies like Qualcomm, which is estimated at $1bn a year.
The chip business being off-loaded includes baseband processors, RF transceivers, power management/audio, software and platforms for the cellular handset market.
The focus for Freescale seems to be the automotive market, where it is a strong microcontroller supplier, and the networking market.
The company said it would also increase its investments in the industrial and consumer markets especially in its microcontrollers, microprocessors, power and sensor ICs.
“As the semiconductor market continues to consolidate, it is essential that we maximise our investment on growth opportunities,” said chairman and chief executive officer Rich Beyer.
The decision to review its involvement in the handset business is part of what Freescale called a plan to “sharpen the company’s strategic focus on growth markets.”
“In support of this targeted approach, the company announced that it will explore strategic options for its cellular handset chipset products business and intends to complete a sale, joint venture agreement or other transformation in the coming months,” said Freescale.
Freescale’s plan has parallels with the decision of NXP, another private equity-owned chip maker, which effectively got out of handset chips earlier this year. NXP put its mobile phone chip business into a joint venture with STMicroelectronics, a venture in which ST has the dominant 80% stake.
The handset market is dominated by two big suppliers, Qualcomm and Texas Instruments, and companies such as Freescale and NXP have recognised that they cannot match the R&D investment of companies like Qualcomm, which is estimated at $1bn a year.
The chip business being off-loaded includes baseband processors, RF transceivers, power management/audio, software and platforms for the cellular handset market.
The focus for Freescale seems to be the automotive market, where it is a strong microcontroller supplier, and the networking market.
The company said it would also increase its investments in the industrial and consumer markets especially in its microcontrollers, microprocessors, power and sensor ICs.
“As the semiconductor market continues to consolidate, it is essential that we maximise our investment on growth opportunities,” said chairman and chief executive officer Rich Beyer.
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