"There is still a very big captive Japanese market, but the next battle could be battery/hybrid vehicles and Japan is unlikely to buy batteries from the USA when they have such big players in that market."
Interesting because I think Toyota is buying their batteries from Tesla for their upcoming plug-in hybrid Prius and all-electric Rav4. Japan and China build laptop batteries, and Tesla connects them up in a way that can be used in a car.
In any case, with each generation of IC, fabs become more and more expensive to build--billions of dollars. It is difficult to do the design and fab in one company because there are few designs that will have enough volumes to pay for the fab (Intel with its processors being the one exception). You can try to achieve this by combining companies, but it can be difficult to get the balance right.
So maybe they are taking the right approach.
I think Fujitsu make FPGAs for Lattice Semi. Take a printer apart and look at the chips inside. I took a Canon and Epson printer apart as they cost the same as ink (included ink), and I wanted to make some art statements. To go to Avnet for chips as a printer or camera manufacturer means you had no input into the SoC, which is unlikely to work in those highly competitive markets. Any US camera or printer manufacturers (or large TV manufacturers or any commodity electronics?). There is still a very big captive Japanese market, but the next battle could be battery/hybrid vehicles and Japan is unlikely to buy batteries from the USA when they have suck big players in that market. Might as well round them out with power electronics and SoCs as well as there seems to be some margin there. Avnet's shareholders would want to make more than they would allow the Japanese OEMs to make, so no need for greedy middlemen. As for a range of chips, look at TI and Freescale for divergent devices even with an ARM core.
Sony went south under the leadership of a westerner. I never worked in any consensus companies, but corporates in the West have leaders who think they have a direct connection to God and any suggestions that are not in line are seen as dissenting. How is HP doing with their CEOs? Think about the losses to shareholders and employers there. In fact, strong US leaders have been responsible for the collapse of Enron and a host of others.
Ultimately, it boils down to a cost issue. The cost of developing new processes, building and tooling new fabs, and what you can charge for the wafers you produce. Japan is an expensive place to do business and it is difficult to attract external business when competing with the likes of TSMC. It wouldn't surprise me that they consider a wide array of consolidation and/or JV opportunities to try and improve competitiveness.
Aggressive marketing may be another area. If semiconductor business of this merger closely work with Arrow, Avnet or other distributor, they may get very good market share and user can have easy access to this chips.
I'm not so attuned to this business side of the industry, but nothing about any of these plans for the future seems strange to me. In the global playing field, when (for example) the different fabs have a hard time surviving as separate entities, the natural reaction is to consolidate. As a first step. The next step might be to do what the US did, and use increasingly fabs from overseas.
As to companies like Sony, that's a different discussion. It seems to me that Sony just didn't jump on the digital bandwagon fast enough. But there's nothing unusual about that either. Sony had the Walkman, for instance, which in hindsight could have been morphed into a digital player like the iPod. Of course, the iPod has also had its day in the sun, and for now, it is the iPhone and iPad that make everyone giddy.
But these are all cyclic things. The more trendy, the shorter lived. You can bet on it. And this holds most especially for personal handheld gadgets. Who wants to be seen with yesterday's fashion accessory? Come now. No one should make the mistake of assuming that today's fashionable gadgets will last a day longer than yesterday's, right?
I see a Japan Inc. that is going through the same transitions as US companies, maybe delayed by a few years. And yes, it's certainly true, the design-by-committee prevalent in Japan is not always a good thing.
We hope not. Making Japan IC chips a captive market within it's systems division is essentially what they have now, and that market simply isn't big enough.
The new entity needs to create products it can sell to the *world* market to be viable.
Intellectually and strategically, it makes sense for Japan to combine Renessas, Panasonic and Fujitsu chip manufacturing into one entity. After all, it is difficult for individual companies (except Intel) to keep up with fab innovations due to costs. Organizationally, it seems it will be difficult...perhaps that is why they brought in Global Foundries into the deal. At best, it will take time to merge these manufacturing units effectively. I think this will make Japan IC chips more of a captive market within its own systems divisions. Steve Szirom, InsideChips.com.
I think many of us feel that this JVs won't work unless there is a strong leadership to shepherd the project. But if we are to go one level deeper, and pick things apart -- in terms of what Panasonic can offer; what Fujitsu has; and what Renesas can bring to the table, what do you see that you like? Are there any specific technologies, products and IPs does any of you want...or "must have"?
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