Many semis companies say they want to sell software. We think they really want recurring revenue and software company multiples. And what they really need is competitive advantage, which software can sometimes provide but is not the only way.
Less than a decade ago, CPUs were the dominant form of compute and everyone ‘knew’ the market could only support two vendors. Today, there are over a dozen companies making CPUs.
Every chip company has ambitions to sell software too – but there are very few software models that will work for them.
Global Foundries’s future lays in bringing the fabless business model to the analog industry. The transition to 300mm wafers could prove a big catalyst for that.
Moore’s Law has been the low interest rate boost to semis for a long time, but those rates are rising now, and that may reshape many assumptions we take for granted in the market.
Android is a hot mess. Google should make it truly open source. This would relieve them of a major anti-trust vulnerability and infuse a massive amount of energy to the project.
Nvidia just had a developer event which highlighted all the partners they have, a vision of the verticalized future of semis. In contrast, Qualcomm’s sales structure does not look like that.
Just for the sake of argument could Qualcomm buy its way back to near-term revenue growth? We take a not-so-serious look at one option. The point is there are not a lot of good targets left.
Open Ran – This is not your beautiful house. This is not your beautiful car.
What role is left for Nokia and Ericsson? Are they systems integrators? Specialty equipment vendors? Enterprise mobility solution provider? None are great options.