We often cover big companies' layoffs. But what happens after a tier-one company shuts down a design team is rarely reported, largely because we are not privy to that info. Synapse Design has given us some insights into what might be going on behind the scenes and after the layoffs.
I ran an embedded systems division of a services company back in the last big tech expansion. We worked strictly for fee, and we were not cheap. We also had a nearly 100% success rate on very cutting-edge products (we built a tablet computer for a spinoff from Xerox in the mid-1990's). Many of our competitors were sharing equity with their customers in the hope of cashing in, and my comment to them was generally "I hope it works out for you".
My problem with that model is that it complicates things. IP negotiations rarely are easy, and if the contractor does not bring significant IP of their own to the table then they have to explain to a customer why they should pay twice for a design that they end up not owning outright. If the contractor does want to develop IP of their own, they have to allocate resources to develop and maintain that IP out of an internal IR&D budget. That can be deceptively expensive and problematic.
I also have a philosophic concern. When I am building a system to the client's specification I can concentrate on what best serves their needs. If I am trying to mold it into something that I might be able to reuse for future clients then I am trying to serve two masters, and one or both will suffer.
@LarryM99, thanks for sharing your own experience. Pulling off miracles on sometimes impossible situations, I am sure, would not come cheap. however, I, too, see the potential conflict -- as you elaborated in your comment. Being a subcontractor, you can focus on your client's spec. But being a "partner" means that you have your own agenda to satisfy too. Let's see how this will work out.
Co development of IP in right sharing mode depends heavily on who is the partner. If the partner has capability of developing the IP itself then it is very tough for service provider to persue customer for right sharing. But if the customer does not have the capability then it becomes easier.
For example if an SoC company is customer of ASIC design services company then it will tough for the service company to share the right. But things may change if the customer is a system company who does not have any SoC design team in house.
The business model will see a big success if the ASIC design services company can target system companies for their custom SoC development. But the issue is this will need deep domain expertise which typically the design services company lacking