India UK Semiconductor handshake; where it can be strong?

Recently UK industry has invited Indian semiconductor and IT industry experts to tour UK to explore how UK semiconductor and IT industry and Indian semiconductor and IT industry can work together for mutual benefits.

The semiconductor industry in India and UK are nearly same in terms of talent and focus. The difference is, companies in India does backend work where as in UK companies own semiconductor chip IPs. Just like the difference between Wipro and ARM. Both design semiconductor chips on paper otherwise today's e-paper, i.e. computer using VLSI chip design software. Wipro does more of a servicing where as ARM sells its design code converted into product in the form of chip-design blue-print. Thousands of engineers from leading Indian semiconductor design service companies in India offer chip design services of all stages from concept to tape-out. The services Indian companies offer are of high quality but cheaper than developed economies, just like any other Indian IT services. In fact ARM has got done good amount of IP services work from Wipro. Wipro is successful in offering design services but not in selling IPs.

So where does the real power in partnership lies between India and UK; it's all about extending IP ownership to Indian companies which have the technical capability to develop powerful IP cores for SoC class chips. This kind of a joint ownership can produce highly impressive business gains for both companies. The jointly branded products can serve the local markets of both the regions.

India semiconductor market is suddenly waking up with a growth outperforming semiconductor industry's other well-known markets. UID, Solar power, mass consuming convergence gadgets (if not a $20 laptop but a 100$ laptop/netbook), and automotives are just a few examples where ARM and other UK based companied can profit through a joint partnership. One example of opportunity on the other side is, more popularity of Indian electric car Reva in UK rather than in India. Here UK and Indian automotive electronic companies have an excellent opportunity to partner.

In the processor market, ARM is now competing with world's number one Intel. When compared to Intel ARM is a small company in revenue but has every key ingredient to stand to the heights of Intel in terms of technology. What it lacks is powerful partnerships in the newly emerging markets. Indian companies can fill major amount of its shortfalls such as application software as well as chip design services. But both Indian companies and UK companies need a fab partnership. With newly formed semiconductor fab companies like globalfoundries is around. There is link to bridge to form alliance covering every aspect of chip design.

Its not just UK, semiconductor companies in the bigger region of EU are sharply focusing on emerging market opportunities in India. NXP Semiconductor partnership with Tata BP solar is very good example of a smart partnership.