'Invest in chip technology or face wilderness' says distributor forum

‘Invest in chip technology or face wilderness’ says distributor forum
Mick Elliott Distributors are going to have to stump up more investment or be left out in the cold as new semiconductor technologies pass them by. This was the message hammered home at the Europartners Distribution Forum in Paris last week by suppliers Motorola and SGS-Thomson Microelectronics. Demand creation and the ability to contribute to customers future semiconductor applications were touted by Daniel Hoste, global consumer segment sales director for Motorola Semiconductors. Hoste described the “intimate relationships” Motorola has forged with key customers, including Volvo. “Our engineers work with Volvo engineers to design Volvo’s next generation of cars.” “To enable us to introduce distributors into the supply chain they must be able to be equally intimate on such terms with customers.” “Distributors must understand our business in even more depth,” he added. His view was backed by Carlo Bozotti, corporate vice president, SGS-Thomson Microelectronics. Bozotti highlighted the shift to supplying systems on chips. “The distributors must help create demand by offering more integrated solutions to their customers. That helps us sell more products,” Bozotti commented. Bozotti wants to increase significantly the present 25 per cent of differentiated ICs SGS-Thomson sells through distribution. Maggie Crowther, a partner in Europartners Consultants pointed out this effort must be made when distributor margins are becoming squeezed. “There will be more work for distributors,” she observed.

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