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Will ‘Makers’ Help Chip Guys’ Bottom Line?

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LarryM99
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Re: Makers and chip guys
LarryM99   4/18/2014 6:49:40 PM
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@susan.rambo: That's a good way to describe it. Also getting product out to makers is like advertising/marketing -- hopefully one of those makers will be an influential engineer

Engineers tend to use parts with which they are familiar. If a prototype is developed on particular hardware, that hardware will be the default for going to production. As long as the chip vendors can minimize the support costs for a lot of startups by handing them off to groups of enthusiasts it's hard to see this as a worse gamble than creating reference designs.

If nothing else it creates a way for them to get deeper into retail channels. These maker components are showing up on the shelves at Fry's, which makes them much more accessible than having to go through the distributers.

alex_m1
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Maybe
alex_m1   4/18/2014 7:47:24 PM
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I wonder if today, instead of making all the money in 1M units/year chips ,some ic companies make a larger part of their money in 50-100kunits/year sales, since more things are sold at that levels and at those levels companies care more about time to market and less about every cent. If this is true and growing,it's another reason for the maker strategy to make sense.

Also, since the iphone,a higher level of product design is required, which calls for using experienced product designers(not just makers), their tools(arduino, javascript and tools  they learn at the weekend) and many prototypes . An such tools might even make sense in production as a way to rapidly respond to a changing market, with relatively small cost increase.

 

Matthew Quint
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Look towards the future
Matthew Quint   4/18/2014 7:47:50 PM
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Long before the  Maker movement became popular, I was a PR manager at Signetics. Many engineers and tech editors happily recounted stories of receiving free 555 timer samples from the company for use in school projects or garage experiments.  These giveaways helped make the 555 one of most popular devices of all time.

Even though, Signetics was not an epic success like Intel, it did help educate generations of engineers and find millions of homes for the venerable timer.  The moral of the 555 story is that looking at the immediate bottom line is not the only way to evaluate the love fest between makers and chipsters.

 

 

 

Sheetal.Pandey
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Re: Look towards the future
Sheetal.Pandey   4/19/2014 9:17:09 AM
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Yes it is quite practical to have chips and evaluation board's cost below $100 so that engineers can buy it themselves instead of waiting for long process in corporates to get the funds approved. Have seen the frustration of engineers due to delay in funds approval.

alex_m1
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Re: Makers and chip guys
alex_m1   4/19/2014 2:22:23 PM
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One interesting place to look at the effect of maker communities on real products is the mbed community: it's relatively old, uses commercial friendly licenses and is relatively easy to transfer to manufacturing. Not sure how to get the data. Maybe asking mbed or arm, the company behind the project, is a good way.

AZskibum
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Re: money for nothing and the chips for free?
AZskibum   4/19/2014 9:54:10 PM
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The maker community's collective efforts to develop firmware, drivers, etc are great, but do you honestly think a chip company would rely solely on that -- software that the company itself cannot support -- as the only means of enabling its reference design?

betajet
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Re: money for nothing and the chips for free?
betajet   4/20/2014 9:31:18 AM
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ASskibum wrote about: ...software that the company itself cannot support...

As long as the community-developed software uses a standard open-source license, the company can at any time fork the software and support the fork themselves.  If it's a copyleft license like GPL, the company will need to release the improved source code with binaries.  If it's a permissive license, they don't ever have to release source code again.  (At least that's my understanding, IANAL).

The community has done the hard work of exploring what the software should do and figuring out what tricks are needed to get around the quirks of the chip, so those high-risk, high-cost (in terms of programmer time) factors are taken care of.

A great way to bring the software in house is to hire the key community developers, which gets the company immediate expertise and demonstrates that yes, programmers can make real money writing free software.  Plus, if the key developers wrote all the code they can relicense the software to the company on a proprietary basis.

betajet
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Business Area One
betajet   4/20/2014 9:46:10 AM
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Here's another factor.  In many large companies, there is Business Area One (IBM terminology), which is the largest money-making part of the company.  For IBM, this used to be mainframes, for Intel it's the x86 line.  Typically, the management of Business Area One calls the shots.  After all, if BA1 fails, the whole company goes under.

In some companies, if you're not in BA1 you're a second-class citizen.  If you're a chip-maker, the silicon guys are BA1.  So software and making evaluation and development boards could easily end up having second-class status and the company will have trouble hiring and retaining good people for those jobs.  In that case, outside software and eval board developers could end up producing far better products than the company itself.  If a chip has exciting capabilities, people in the developer community will get excited and create wonderful software and boards, provided that the chip-maker publishes adequate documentation.  "Of course, the whole point [...] is lost, if you keep it a secretWhy didn't you tell the world, eh?" [Dr. Strangelove (1964)]

rick merritt
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Re: money for nothing and the chips for free?
rick merritt   4/20/2014 9:54:57 PM
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@AZskibum: I agree. I see the maker crowd as an extra, a freebie and a Hail Mary pass to those who are in trouble.

cander111
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Off the Island
cander111   4/21/2014 11:53:28 AM
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Good article. I think there is another angle here.

Back in the 70s, the standard success story was 'management didn't want to take risks on eating their current business, so we struck out on our own with an idea". Not a problem, since HP, DEC, and IBM ruled and the pesky startup types were just a pain in the management's butt anyway. No Prez will loose his job.

In the past few years, the opposite situation has come up. When Intel turned down Apple's request for a processor for iPhone/iPad, the storm cost people their jobs and the company a good chunk of their capitalization. Every BoD now hammers Exec staff on how hip they are to new types of customers. No chip company Prez will survive without a 'maker' story to tell the BOD. "Yes, we are building tools for the guys in dirty Hoodies who hack IoT stuff!" No one on the BoD is asking about ROI questions about the unwashed semi-masses yet. 

It is easy to put a small team in place, give some love to the open source community, and issue a bunch of Press Releases. Not so it you have to go to the BoD and explain why you missed a market. 

Ask former Intel execs.....

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