TAG | Ericsson / STMicro JV to shake up wireless chipset market |
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| by Stuart Corner | |
| Thursday, 21 August 2008 | |
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Page 2 of 2 He added: "Another key driver is to have the scale to lead and develop next-generation technologies. To be successful in this market requires very substantial R&D investment, and few semiconductor players can make this scale of R&D investment."The joint venture will comprise two separate businesses: a development and marketing company with approximately 7,000 people employed; and a platform design company, with approximately 1,000 people employed that will provide platform designs to the development and marketing company. The joint venture will be headquartered in Geneva and ach parent will appoint four directors to the board STM-NXP was formed in April 2008 when STMicroelectronics and NXP, an independent semiconductor company founded by Philips, announced plans to combine their respective wireless chip making operations to form a joint venture. They claimed that the JV would have the scale to better meet customer needs in 2G, 2.5G, 3G, multimedia, connectivity and all future wireless technologies and would own "thousands of important communication and multimedia patents." They said that the new company would be "a solid top-three industry player and among the few companies with the scale and expertise to pursue the R&D investments necessary to establish itself as a leading player in the wireless and mobile-multimedia market." STM-NXP was billed as combining design, sales and marketing and back-end manufacturing assets from both companies relying on its parent companies and foundries for wafer fabrication services. It claimed to be "well positioned with all of the vital technologies for UMTS; for the emerging 3G Chinese standard; as well as other cellular, multimedia and connectivity capabilities, including WiFi, Bluetooth, GPS, FM Radio, USB, and UWB (Ultra-wideband)," and able to serve its global customers with complete wireless and mobile solutions across the spectrum of applications. It also included the Silicon Laboratories' wireless and GloNav's GPS operations recently acquired by NXP. NXP presently holds 20 percent of STM-NXP and this will be acquired by STM prior to the new JV with Ericsson being formed. Frans van Houten, CEO of NXP, said: "We understand the desire of ST to call our 20 percent stake in order to expand the ST-NXP Wireless joint venture with Ericsson. We support this...[and] to help ensure the success of the joint venture going forward all NXP's supply and support agreements will continue as planned. The additional proceeds of the 20 percent stake will enable NXP to further build leadership positions through innovation and investment in NXP's core businesses."
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