Page 1: Introduction
Using a laptop computer, Smartphone or iPad has become an essential part of everyday life for many people. Few, however, will be aware of how the technology that drives these tools is created.
ARM is the world's leading semiconductor intellectual property (IP) supplier. Intellectual property is that which originates in the mind such as ideas, literary works, music and designs. ARM’s business model is not typical. It does not own any factories but instead designs and licenses its technology to a network of partners who carry out the manufacturing. Over 900 licenses have been sold to more than 250 different partner companies. These include the world's leading semiconductor and systems companies, such as Samsung, NVIDIA, Texas Instruments and Qualcomm.
From its founding in 1990 in Cambridge in the UK, it has grown to become a major developer of digital electronic products. The company has offices around the world, including design centres in the UK, USA, India, Scandinavia, France and China.
ARM is a Research & Development (R&D) focused business. Its ‘products’ are intangible and cover a diverse range of applications. They are used in everything from sensors to servers. Mobile phones, tablet computers, washing machines, car braking systems and network routers all use ARM technology. In return for its technology, ARM receives a license fee for the original IP from the partner and a royalty on every microchip produced. To date, over 20 billion chips containing ARM technology have been manufactured.
ARM relies on the high levels of creativity, innovation and knowledge of its people to continue to develop new ideas and provide customers with the benefits of emerging technology. Its R&D activity is collaborative and generates innovation in other companies. For example, leading brand Smartphones contain ARM technology that has been incorporated into chips manufactured by a variety of semiconductor companies. In turn, they use diverse software and applications running on various operating systems such as Android. This sharing of information contributes to increasing the industry’s knowledge base.
This case study will look at the processes of research and development at ARM and show how these support the company’s leading market position.