— Alternate options needed for high power RF business to effectively target $140 billion defense sector opportunity
BOSTON, March 6, 2015 /PRNewswire/ — NXP Semiconductors will buy Freescale Semiconductor and merge operations in a deal that will result in a combined company valued at over $40 billion. With a focus on consumer markets, Strategy Analytics Advanced Defense Systems (ADS) service analysis of this acquisition recommends that the new entity consider alternate options for its high power RF (radio frequency) business if it is to effectively leverage the substantial semiconductor opportunity from global spending on defense systems that Freescale had started to target.
Strategy Analytics’ analysis of Freescale’s opportunity potential in the defense sector and the resulting impact of the NXP acquisition are covered in the "Can Latecomer Freescale Compete Against the Incumbents in the GaN RF Market?" and "Freescale Plans to Become a Regular US DoD Supplier will be Challenged by NXP Ownership" reports.
Click here for the reports:
- Freescale announced a commitment to support the US military sector in 2013.
- The company emphasized its status as the only US-based supplier of Si LDMOS (silicon laterally diffused metal oxide semiconductor) technology with manufacturing in the US, supplemented with a range of new GaN (gallium nitride) RF power transistor products.
- NXP’s acquisition of Freescale emphasizes the growth potential that will come from connectivity across the broader automotive, wireless communications and digital consumer segments.
"Our analysis forecasts a substantial opportunity for semiconductor technologies coming from spending on defense systems that will approach $140 billion by 2023," notes Eric Higham, North American Director for ADS. "Demand from North America will account for 32% of defense system spending at this time."
"Freescale had made a reasonable start towards carving out a position in the defense sector with an emphasis on establishing a dedicated portfolio", observes Asif Anwar, ADS Director at Strategy Analytics. "The combined company’s ability to compete in the US military sector will now remain limited unless NXP plans to position the Freescale and NXP high power RF defense offerings as part of a US subsidiary or spin out and sell the operations outright."
About Strategy Analytics
Strategy Analytics, Inc. provides the competitive edge with advisory services, consulting and actionable market intelligence for emerging technology, mobile and wireless, digital consumer and automotive electronics companies. With offices in North America, Europe and Asia, Strategy Analytics delivers insights for enterprise success. www.StrategyAnalytics.com
European Contact: Asif Anwar, +44(0) 1908 423 635, firstname.lastname@example.org
US Contact: Eric Higham, +1 617 614 0721, email@example.com