Semiconductor giant's frequent acquisitions are intended to be in full-platform mode

TI’s heavy news of more than US$6 billion in the acquisition of NS has not yet been reverberated. Recently, Broadcom’s purchase of NetLogic Microsystems for US$3.7 billion has begun to “reel”. There is also news that the wireless chip maker Qualcomm will acquire IDT's video IC business unit, including the Hollywood Quality Video (HQV) and Frame Rate Conversion (FRC) video processor IC design team, product line and specific assets. The transaction is expected to be completed in a few weeks. Although I do not know the specific amount of this transaction, I think it should not be a small number. The pattern of “strong and permanent” in the semiconductor industry has become increasingly evident, and the space for survival of small and medium-sized semiconductor companies will become increasingly pressing in the future.

At present, the amount of acquisitions in the semiconductor industry is increasing. It is no longer a "game" that SMEs can afford. TI does not need to say that it has acquired NS. TI is also among the giants of the "big and full" analog IC company. Broadcom said it will acquire NetLogic Microsystems for $50 per share, which is 57% higher than NetLogic's closing price of $31.91 per share on Friday. Although some analysts questioned the high prices, Broadcom mentioned in an e-mail response to the “China Electronics News” reporter that although Broadcom’s acquisition of cash was approximately US$3.7 billion, it took into account that the employees of NetLogic Microsystems have turned their equity into After Broadcom’s shareholding will bring about 3.4 billion U.S. dollars in cash income, this transaction will enable the company’s adjusted earnings per share to increase by about 10 cents in 2012, helping Broadcom’s revenue, product gross profit, and operating profit. growth of.

This also shows the trend of all-platform solution providers. Recent market dynamics show that there is a trend in the industry to shift platform development efforts to chip platform vendors. This requires semiconductor vendors to have all the core technologies necessary to build a complete and highly integrated platform. Broadcom's performance in communications network infrastructure and wireless technology is obvious to all. In recent years, it has obtained several core intellectual property rights in this field through continuous enhancement of R&D investment and continuous acquisition, but it still has shortcomings in the field of high-end embedded processors. . NetLogic Microsystems is a global leader in providing high-performance intelligent semiconductor solutions for next-generation networks. It has also made significant achievements in the field of 4G wireless network chips. Its high-end embedded processor XLP series is the core of the highest performance in the industry. one. By acquiring NetLogic Microsystems, Broadcom will receive leading multi-core embedded processor solutions, market-leading knowledge processors, and unique digital front-end technologies for wireless base stations that are key drivers for building next-generation infrastructure. force. This acquisition helps Broadcom to better meet the integrated end-to-end communications and processing platform solutions and further expand Broadcom’s market share in the underlying network market.

In Qualcomm's statement, Steve Mollenkopf, executive vice president of Qualcomm, said that the popular HQV technology will help Qualcomm to consolidate its leadership in video processing. At the same time, the combination of HQV technology and the high-performance Snapdragon processor will enhance the multimedia content display quality of smart multimedia devices such as smartphones and tablet computers.

The trend of integration will intensify. In the past few years, Qualcomm's acquisition of Atheros, Intel’s acquisition of Infineon’s wireless business unit, etc. have not shown a trend of transitioning to a full-platform solution provider. In this wave, it may be hard for anyone to leave.

In this wave, semiconductor companies also have to actively seek "change." On the one hand, the semiconductor industry is a capital-intensive and high-risk industry that requires continuous R&D investment to meet ever-changing standards and market demands; it needs to control key technologies and build core competencies, while large companies pass “combination punches”. The power has already accumulated a profound strength and has laid a solid advantage in a certain area. It is difficult for non-years to accumulate. On the other hand, the advent of the mobile Internet era has brought new challenges to the semiconductor manufacturers' operating models. The time when the hardware is king is already gone. It is not enough to rely on the cost-effective "competition" of several chips to gain market access. As a result, the software platform will occupy an important seat in the future ecosystem. This will not only test the innovation and rapid response capabilities of semiconductor manufacturers in terms of hardware and solutions, but also require a perfect "integration" with the software platform. The changes will continue to be staged and semiconductor manufacturers need to carefully weigh in on how to “take advantage of the situation”. Broadcom pointed out that semiconductor manufacturers are becoming more and more intensive in R&D, and investment will continue to increase, which will bring continuous pressure to SMEs in this market. For semiconductor companies, it is pleasing to be an "expert" in a particular industry segment, but if you do not go through the capital market and take the road of industrial integration, you will inevitably be saved.