NXP Dishes on the Qualcomm Merger, What's Next for IoT

By Paula Bernier November 23, 2016

NXP Semiconductors just last year closed its acquisition of semiconductor company Freescale. Just last month Qualcomm announced plans to buy NXP. And just last week I spoke with Asit Goel, NXP’s senior vice president and general manager, about this consolidation and what’s next for NXP and the Internet of Things.

A 2006 Philips Semiconductors spinoff, NXP has a broad product line addressing the connected world. That includes connectivity and RF offerings, such as near-field communication solutions; processing, including low-power solutions for credit cards, and other offerings that can be used in a range of applications such as the connected car; and security products that provide encryption.

Auto, health, smart cards, smart home, and wearables are the use cases on which NXP is focused. NXP’s customers include Allure Energy, Amazon Kindle, Garmin, Ooma, Sixt Rent a Car, Withings, and among many others.

In announcing its planned acquisition of NXP on Oct. 27, Qualcomm talked about its interest in combining its system-on-a-chip capabilities and roadmap with NXP’s sales channels and positions in the automotive, security, and IoT arenas. Goel described the $47 billion NXP-Qualcomm pairing as a complementary merger. NXP, he said, started with low-power IoT solutions; whereas Qualcomm has a big processing presence with its Snapdragon solution. So the two companies have attacked the IoT opportunity from opposite ends of the market, he said.

NXP took its position in the automotive space to an entirely new level in December 2015 when its closed the nearly $12 billion deal with Freescale. That created the world’s largest automotive electronics company, according to reports, put NXP on a path to use Freescale technology to develop a single integrated radar chip to replace ultrasonic radar systems used in vehicle safety systems, and boosted NXP’s position in wearables.

Goel said the scale of IoT is amazing, as is the complexity. So buying and

using smart devices need to be as easy as buying and using non-smart devices. NXP addresses that with its one-tap provisioning, he said.

Also, IoT will be consumed more and more as a service, he added, which requires a shift of business models. NXP has built an organization around IoT and created monetization models to support that, he said, and other IoT businesses need to do the same.

NXP’s plans for 2017 are to promote its recently introduced low-power chip, which the company says is four times lower power than competing solutions. The low-power march will continue, said Goel. The company also intends to continue its work in standards groups to allow for interoperability. And it’s readying to launch its own brand of “hearable” solutions.

Edited by Ken Briodagh

Executive Editor, TMC

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