Motorola's technology for sale through IP business

AUSTIN, Texas -- Motorola's Semiconductor Products Sector, the chip making part of Motorola waiting to spin-off from its parent, has served notice that many of its technological developments are available for license - including a 90-nanometer CMOS process created as a platform for silicon-on-insulator high performance integrated circuits.

Paul Reidy, director of intellectual property licensing at Motorola SPS, said that in the last year the group has started treating IP licensing as a separate profit and loss business. Now advanced CMOS-SOI processes through smartpower and on to silicon germanium BiCMOS are available for licensing.

"In the past we've licensed out CMOS platforms to Tower Semiconductor and our magnetoresistive RAM to ST, Philips and Honeywell. We're going to be doing more of that. We want to leverage the tremendous R&D benefits Motorola has built up. It complements the asset-light strategy we are pursuing," said Reidy (see October 8 story).

Reidy declined to say what financial run rate Motorola's IP business was achieving but said in the long-term the goal is to "offset most of our internal R&D".

Motorola SPS currently spends about $200 million a year on R&D, which represents a benchmark on how much Motorola would like to see coming back each year, Reidy said.

Like many semiconductor companies Motorola has tried to leverage its technology and its position in the market in the past but with limited success. It successfully transferred CMOS process technology to Singaporean foundry Chartered Semiconductor Manufacturing, but Chartered has turned to IBM Microelectronics for its latest injection of process technology.

Similarly Motorola sought to license out its M-Core processor, but found few takers.

A project out of Motorola research, ThoughtBeam Inc., sought to capitalize on Motorola research into gallium arsenide-on-silicon materials technology. Founded in November 2001 it was shut in January of 2003 (see January 31 story).

"M-Core was late to market. ARM had a head start," said Reidy.

One difference between ARM Holdings plc and Motorola SPS is that ARM does not try to take chips to market itself. It is only an intellectual property licensor and thereby avoids competing with its customers.

Reidy argued that it is possible for Motorola to license intellectual property while taking products based on that intellectual property to market.

"The market that you approach has to be large enough to stop things like that being a concern. For example with MRAM it makes sense for us to license the technology out and create a de facto standard which everyone can participate in. Chip architectures are certainly an area we're exploring but it is more difficult. We are much more likely to license the scientific and basic engineering and process developments."

When asked if Motorola SPS was selling off the "family silver" in a one-shot deal Reidy responded: "This is 'family silver' but there are definitely still 'silversmiths' in the family creating new value."

Reidy would not comment on the forthcoming spin-off from Motorola and on how much a separated Motorola chip company would spend on R&D each year but he said that Motorola SPS would remain committed to investing in R&D.

Reidy said Motorola SPS accepted that process licensing was becoming more competitive as a many integrated device manufacturers tried to maximize returns on their fab-light strategy.

"Our 90-nm CMOS process on 200-mm wafers could be a pretty good differentiator for those companies not prepared to bet the farm on 300-mm manufacturing," said Reidy.

Reidy said the 90-nm manufacturing process he had in mind contained no intellectual property belonging to STMicroelectronics or Philips, who have become Motorola's partners in process development.

"This is a process we developed as a platform for silicon-on-insulator production. We could license the bulk CMOS version. We're prepared to open up the SOI technology as well. Over time we believe SOI will penetrate more and more applications."

Reidy said that whereas in the past Motorola had made licensing deals on an ad hoc basis, the company was now taking a more focused approach to technology transfer. "Now we've got dedicated teams to concentrate on process technology transfer; it could be CMOS or back-end or we could supply yield enhancement services. We're mainly aiming at the tier two foundries and smaller IDMs."

Motorola is even turning itself into a foundry in support of process technology licensing. "Yes, we would start by providing a licensor with a design kit and have them manufacture their circuits with us as part of transferring the process to their manufacturing sites," Reidy said.

Reidy added that such foundry manufacture was already happening based on Motorola's SmartMOS, and silicon germanium BiCMOS processes and would likely happen around the MRAM technology.

"The MRAM licensees are looking for samples from us right now. But the interest in MRAM is picking up."

When asked if all technologies are up for licensing Reidy said that was not the case. He gave the example of Motorola's work on nano-crystalline flash memory (see December 8 story). "It's too early for nano-crystal flash. If we licensed it now we'd be licensing it too cheaply. But it could be real opportunity for us in a couple of years time."