February 2009 Archives

As predicted in our post of January 23^rd, Intel is to out-source Atom. The reasons are very simple, Atom has to be a low margin part as it competes for slots in end-user products now costing around $400 but expected to decline to $100-200 within a year.

Jean Hoerni, one of the 'treacherous eight' who left Shockley Semiconductor to co-found Fairchild Semiconductor, was Swiss. At Fairchild, Hoerni invented the planar transistor which was the key to Bob Noyce's invention of the integrated circuit. Hoerni left Fairchild to found successively Amelco, Union Carbide and Intersil. When he founded Intersil he  tapped a couple of Swiss watch companies, Omega and Portescap, for venture capital.

ARM's going to have get down to the grubby business of fighting for slots now that Intel has made it clear that its aiming its 45nm Atom squarely (but probably not fairly if history is any guide) at the smartphone market.

There was once a very distinguished UK company which produced the first commercial computer, the first European microprocessor, and invented the semi-custom chip. It was a big contractor to the UK military.

Will there be blood in the streets by May? Well there could be if companies lay off large numbers of people, while governments keep giving huge amounts to banks which lavish it on their staff.

Intel's spat with the EC over whether Intel uses illegal anti-competitive business practices, seems to be getting increasingly bad-tempered.

Giving a hostage to fortune is not usually a very good idea, especially if you don't have to do it.

'The BBC, whose plans for an experimental colour television service were turned down by the Post-Master General last January, are re-opening the matter with him'.

Starts a story in Electronics Weekly's edition of April 26^th 1961.

The only people with a greater insouciance toward the value of money than Wall Street bankers are DRAM manufacturers. To them money is as precious as confetti.

The interesting thing about the alleged flaw in Intel's solid state disc drives is not how they fix the flaw, but how they react to it.

A few weeks after the invention of the transistor, while the invention was still a secret,  co-inventor Walter Brattain attended a meeting of the American Physical Society at which two graduate students from Purdue University, Seymour Benzer and Ralph Bray, were reporting the results of their experiments with germanium..

A brilliant mathematician and computer pioneer, credited with saving Britain in the Second World War by cracking the Germans' Enigma code, was a genius ahead of his time. But some of his predictions weren't so good.

Well is phase change going to happen or not? After quoting Numonyx's CTO last week that Numonyx started selling a phase change chip last year, I have had a number of people writing in to say this doesn't actually seem to be the case.

Intel has told MWC attendees that they don't think ARM-based chip-sets will make much of a dent in the 100 per cent market share of the netbook/MID market commanded by the Intel Atom.

Thanks to IFI Patent Intelligence [http://www.ificlaims.com/] 2008 for this one. The ten companies which earned the most US Patents in 2008 were:

It's clearly going to take genius to fix the world's problems and the question is: Are Barack Obama, Gordon Brown, Angela Merkel, Nicolas Sarkozy et al geniuses?

Well my case rests. But here's an engineer who was at TRW and Ball Aerospace with a novel take on how to solve America's problems: http://www.ideasforourfuture.com/

'The magnificent Soviet achievement in hurtling the first man into space has been heralded throughout the world as the beginning of perhaps the most exciting era in the history of mankind. But it is not the achievement itself which is important, but what it symbolises.'

So starts the Comment piece in Electronics Weekly's edition of April 19^th 1961 -  one week to the day after Major Yuri Gagarin of the USSR became the first man to enter into space on April 12^th.

Challenged at the weekend by a reader to come up with a ten point plan for the recovery of NXP, here it is. The main problem is, of course, the $6 billion of debt loaded on the company by its private equity owners KKR, but it might be possible to find a way out of this debt burden, while establishing a strong trading position for the future.

On December 1st last year we did a post called: 'FPGA Industry On The Wrong Track. It argued that the FPGA industry is becoming more like the SOC business with products targeted for specific applications instead of relying on its essential strength - flexibility and programmability. Moreover that the FPGA industry isn't tackling its two major problems: that its products are too expensive and use too much power.

Forget the churches, architecture, art galleries, concerts, Bellinis (painted and poured), carnivals, masked balls, vaporetti and gondolas - the great claim to fame of Venice is that it's the last great drinking city on earth.

See: Ten Point Plan For NXP's Recovery

Challenged by a reader to come up with a ten point plan for the recovery of NXP, I am now thinking, and asking questions, and trying to figure out what could be done. It is a task far beyond my competence so I'd be more than grateful for any suggestions you care to make, either by replying to this post, or by emailing david.manners@rbi.co.uk.

Sharp was one of the pioneers of LCD  manufacturing in Japan and, for many years, had a better than 50% world market in LCD panels. How did it achieve this pre-eminence in the industry?

Is phase change really going to happen? For a while now people have been looking at phase change like they look at ferroelectric memory, bubble memory and MRAM as a technology which was never really going to make it except in niches. But yesterday things changed.

There was once a very clever man who invented a device which changed the world and for which he was awarded the Nobel Prize.

Some semiconductor companies are operating in uncharted waters as they seek to borrow money to keep going. This is something new for the semiconductor industry which has traditionally been able to fund itself through recessions on the cash surpluses accumulated during booms.

If the shareholders, investors and management of Rambus were readers of the novels of  Charles Dickens, they could have saved themselves a ton of money and decades of hassle.

The ten gloomiest forecasts for the 2009 semiconductor market ranging from a 28 per cent decline forecast by Future Horizons to a 15 per cent decline forecast by Goldman Sachs are:

The vulgarly named Super Return conference, the jamboree of the private equity industry, held in Berlin last week saw some chastened presenters..

'Epitaxial transistors very soon . . . .planar devices by early 1962. These are the basic plans of the Ferranti Electronics Department, but they are by no means the only plans,' is how a story starts in the April 19^th 1961 issue of Electronics Weekly.

Many years ago, the personal computer which everyone in the UK wanted to buy was not the IBM PC, or the Apple II, but the BBC Micro made by the Hermann Hauser-led start-up company, Acorn Computers of Cambridge. 

Don't worry about recession in the semiconductor industry, it won't be lasting all year. That was the message from semiconductor industry analyst Bill McClean of IC Insights to the recent ISS meeting arranged by SEMI the trade body for semiconductor production equipment and materials suppliers.

In this, the fourth instalment of how to run a semiconductor company, taken from the book Chip Management by Tsuyoshi Kawanishi, the famous former CEO of Toshiba Semiconductors, he addresses the issue of how to manage return on investment.

When Warren East, CEO of ARM, and Rich Beyer, CEO of Freescale, met up a couple of weeks back, one of the topics on the agenda was, most likely, an exchange views on the upcoming entry of ARM-based chip-sets into the netbook market.

Once upon a time, years before the chip was invented, the company which was making more transistors for the open market than anyone else was making them all for a single application - hearing aids.

By 1953, the company was making 10,000 junction transistors a month selling for around $9 each. But it never made a transistor for any other application than hearing aids.

By 1957, the company still supplied 80 per cent of the market for transistors for hearing aids, but had been overtaken by other companies in total volume of transistors produced.

By 1960 the company was no longer a leading player in transistor production.

MORAL: A One-Trick Pony Can't Be A Stay-er.

According to the ratings agency Fitch, Freescale has more than $10 billion debt, but Freescale CEO Rich Beyer reckons it can be handled.

Eugene Kleiner, co-founder of Kleiner and Perkins which evolved into the tech industry's most famous venture capital company, Kleiner, Perkins, Caufield and Byers, was good at propounding Laws. Kleiner generated many of these Laws which have passed into industry folk-lore, and which now form the set-in-stone tenets for today's VCs all over the world.  These are the ten best:

'Seat reservation offices of British Overseas Airways Corporation throughout the UK and Europe will soon be able to obtain immediate information on the availability of airline seats by direct interrogation of an electronic computer in London.'

So starts a story in Electronics Weekly's edition of April 12^th 1961.

'Inflation, extravagance, bankruptcy' were, according to Gordon Brown speaking at the Davos World Economic Forum , the three words which condemned Britain to the Great Depression of the 1930s. They were scrawled by the then Chancellor of the Exchequer  in response to a stimulus plan proposed by John Maynard Keynes.

Proof, if further proof were need, of the evil effects which private equity ownership has on companies which get bought by private equity funds comes from as couple of US studies into private equity-owned companies.