TI’s integration strategy for National Semiconductor devices begins to take shape
eeNews Europe: What is TI’s market position since the National acquisition?
Beckemeyer: Analog’s total available market on a worldwide basis based on 2010 market figures (Source: Databeans) is $42 billion – this is a huge opportunity for everybody out there. TI was in a position in 2010 to have market share of 14% and with the acquisition of National Semiconductor this will move us to a market share of 17%. Although that sounds a big number compared to our rivals for TI it means there is now basically 83% of the analog business that can still be gained out there. National brings us the opportunity that with the new analog design centers being brought on board for us that we can now focus on the next growth markets and we can expand from here.
Today we are in the range of $3 billion in terms of the total available market for data converters. If you look to 2016 Databeans is giving a forecast of just sub $6bn for the data converters sector. The general purpose ADCs and high speed ADCs are the majority of the total available market to us but for us the DAC side is going to be an important area and we will be also clearly leading the pack.
In the EMEA the industrial market is the key market for us. If you look in the central European area where there are all of the industrial machine manufacturers this is a big market for us. We have the big players here where you go from motor control and programmable logic controllers that need products that can do ±10 V. In Europe there are also a lot of test and measurement manufacturers that make spectrum analyzers and oscilloscopes that need the highest precision down up to the widest bandwidth.
eeNews Europe: How long will you keep manufacturing the National parts?
Beckemeyer: We have a policy of not obsoleting any analog product for our convenience. This has been our policy for a number of years at is very well received and appreciated by our customers. If you look at the applications on the industrial side, on the medical side and on the defense and aerospace side or the communications side such as basestations customers want to have products for 10+ years. They want to buy products for 10+ years. We actually have devices in our portfolio which after 20 or 30 years reach the peak in their revenue. This is our policy we do not obsolete devices for our convenience. We will do the same thing with National products.
All of the National Semiconductor products we will continue to manufacture and to sell. This is a big benefit for our customers because the situation was not necessarily like that before on the National side. This will be a big shift and will be a big advantage for our customers.
eeNews Europe: What is the position regarding process technologies?
McCormack: One advantage on the process technology side of things is that we now have the ability to develop our own process technologies and means that our engineers can get access to state-of-the-art processes for developing their circuits. We can tailor make our processes so that they are ideal for making analog circuits.
For example, from the National side we can now put our ADCs on pure CMOS process which allows us to achieve higher speeds and low power consumption. On the amplifier side TI use similar processes with its BiCMOS process but they can now develop and tailor this process with bipolar and SiGe capabilities to get the very best performance from high speed amplifiers and RF components such as frequency synthesizers.
This is a unique advantage because it means we don’t have to use external processes that are often tailored towards digital circuitry.
eeNews Europe: How long will you keep the National brand for?
Beckemeyer: Initially we are branding the devices as ‘National products from Texas Instruments’ but over time you will see that this is going to disappear. Today if you look at Texas Instruments businesses we have four pillars.
We have a pillar that is called Power Management. We have a pillar that is called High-performance Analog. We have another pillar that is called High Volume Analog and Logic. The National brand is in the mean time our fourth pillar. It is fully integrated in our analog organization and this organization is a pillar which is called SVA and stands for Silicon Valley Analog. This is the way we are going to move forward.
In terms of the Road Maps there will be a continuation to start with and from here customers will decide at the end where our direction will go and this will be based on the capabilities of our strategic entities such as the four pillars we have today. So we will run the National business as a clear addition to our existing analog business entities and this is very important because this will set us up for growth which is the only thing we are really aiming at. We want to utilize those design teams and utilize their capabilities and not just merge them into other teams. This will be our fourth strategic business entity.
eeNews Europe: How much capacity does TI now operate?
Beckemeyer: In 2010 our business on the analog side was $6 billion. We can grow by another $5 billion with the current investment we have in place and with the current wafer fabs we have up and running.
Another important point to bear in mind is that we are qualifying our processes in multiple wafer fabs. If you look at customers’ concerns unfortunately natural catastrophes like we have seen in 2011 such as in Japan and Thailand put a high demand on customer security. Customers appreciate if we can tell them that we can secure their supply be being able to manufacture the product in another region. We have a multiple sourcing strategy were we can manufacture products in more than one wafer fab.
eeNews Europe: What do you see as the benefits of the two businesses coming together?
Beckemeyer: This is more about the opportunity we have in front of us which can be summed up as ‘Delivering more together’. This is not just about acquiring a piece of a business to expand on our market share this about delivering more in the future for our customers in terms of products and solutions. This is the case because we now have more design and development capabilities.
We now have the industry’s largest analog design team. When you look at analog IP or analog design expertise it is a scarce resource. What we are getting with National Semiconductor on a worldwide basis design teams that used to be the pioneers on the analog design front. This gives us the opportunity to move forward into different directions.
We now have more than four million square feet of manufacturing capacity. In Germany we have increased our wafer fab by more than 20 percent.
Our product portfolio is highly complementary. If you look at the power management area of the business you will see that National Semiconductor has been focusing a lot to succeed in the industrial sector. Their capabilities on the input voltage side are higher compared to what Texas Instruments has offered so far. National was more focused on the high input voltage and Texas Instruments was focused on the higher output current.
Today we can offer a product portfolio within the analog domain of about 45,000 products. We have come from 32,000 products and are going to 45,000 products. National offers ultra high speed with up to 3.6 GSPS while TI also offers high-speed, high resolution solutions. On a yearly basis Texas Instruments releases about 500 products overall.
If you look at tools and support you can see how both companies differed in their approach to supporting customers. If you look at Texas Instruments we have the largest footprint of sales and field application engineers out in the regions. National Semiconductor had less people out in the field in terms of sales and field application engineering people but National had the unique tool of WEBENCH simulation software which allowed people to directly online simulate and get the Bill of Materials, circuit diagram or their desired schematics for their application.
eeNews Europe: What do you see as the key trends in the data converter markets?
McCormack: Data converter developments always mean higher speeds because they allow the capture of faster signals and allow the capture of wider bandwidth. This gives the ability to increase the Nyquist bandwidth and the latter always makes up half the sample rate. We now have data converters that can go up to 3.6 GSPS which is by far the fastest in the market and allows the capture Nyquist bandwidths up to 1.8 GHz. We now have DACs that can sample above 1 GSPS. It is important that for both the ADC and DAC side of things that we are really pushing the envelope in terms of speed.
Accuracy is another important parameter when you are talking about data converters. This really boils down to resolution. If you look at data converters from TI and National together we now have precision converters that have up to 31-bits of resolution. We now can offer extremely high resolution data converters with Sigma Delta architectures.
On the high-speed side we go up to 16-bits and this enables you to measure smaller signals and allows you to have more dynamic range and better signal to noise ratio and better linearity.
Another trend is low power with single supplies. Customers have been asking for fewer and fewer power rails so now most of our converters operate off a single supply rail.
In terms of integration we have been introducing innovative products in the past year that integrate ADCs, DACs, amplifiers and some digital functionality which allow customers to integrate more, reduce size and reduce power consumption.
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