By Michael Kanellos, 19 June 2003 10:30
NEWS ARM and Rambus retained their positions as the top two companies specialising in intellectual property for semiconductors. So-called IP semiconductor companies - which earn their money by licensing designs and patents to chip businesses that in turn make or sell semiconductors under their own names - grew faster than the chip market as a whole in terms of revenue, according to research firm Gartner. IP companies collectively accounted for $933.8m in revenue in 2002, up 4.7 per cent from revenue of $891.5m in 2001. By contrast, revenue from actual chip sales grew by only 1.9 per cent. Revenue from chip sales, however, is far larger and is well into the billions. Cambridge-based ARM remained the number one licensing company. ARM's 2002 revenue came to $184.9m, up 10.1 per cent from 2001's $168m. In all, ARM accounted for 19.8 per cent of the industry. Chips based on ARM designs are found in the majority of the world's mobile phones. Rambus, meanwhile, saw revenue drop but it still retained the number two spot. The Los Altos, California-based company saw revenue decline to $97.4m from $107.3m. It now has a market share of 10.4 per cent. Rambus initially specialised in designs for high-speed memory but it is transforming itself into a company that develops chip-to-chip connections. Other top IP companies in the semiconductor sphere included Mentor Graphics, MIPS, Synopsis and TTP Com. Generally, these companies earn revenue through licensing fees, which let manufacturers use the companies' intellectual property in designing their own products. They also earn revenue through royalties for shipped products that incorporate the licensed intellectual property. Michael Kanellos writes for CNET News.com.
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