Lars Reger chatting with Bolaji Ojo. Source: Ojo-Yoshida Report
By Bolaji Ojo
What’s at stake:
NXP Semiconductor has already a formidable presence in the market for software-defined vehicles, but a recent acquisition will add critical expertise that the company plans to leverage as it makes a play for a bigger role in robotics and in the potentially huge market for devices capable of processing data without needing to connect to the Cloud. The company hopes its messaging about and focus on the deployment of safe, secure, dependable, and trusted devices will continue to resonate with customers.
When NXP Semiconductor N.V. announced last week that it had reached an agreement to purchase Austria’s TTTech Auto, observers focused initially and primarily on the value of the transaction to the chipmaker’s burgeoning offerings and interests in the software-defined vehicle (SDV) market.
As important as the SDV angle is to NXP, however, the real gem of the acquisition and the significance to the Netherlands-based company are a lot broader. TTTech Auto is about to become a critical part of the NXP “robot story,” as the chipmaker broadens its presence in the market for products it says must operate in an environment of trust, safety and security.
Those devices are coming to most segments of the economy and NXP has just secured its ability to better serve the segment with the help of some highly trained software engineers that will join its team once the TTTech Auto deal closes later this year.
“Pending regulatory approvals, TTTech Auto including its management team, intellectual property, assets, and approximately 1,100 engineering staff will join NXPs automotive team,” the company said, in a statement.
The employees that NXP will be hanging onto will add critical software (middleware) expertise to the company and help fuel its activities in the growing market for safe, secure and trusted sensing devices representing a potential market size of about $70 billion, according to Lars Reger, CTO at NXP.
“Our dream is to help realize a world that anticipates, automates and enables intelligence systems at the edge,” Reger said, during an interview with the Ojo-Yoshida Report. Speaking on a webcast with the Ojo-Yoshida Report while attending the Consumer Electronics Show (CES) in Las Vegas, Reger added:
“We can provide, [and] we have microcontrollers, microprocessors, silicon architectures that are trustworthy, that are functional, safe and secure,” he said. “What we had to have is a software platform … call it middleware on top that leverages the functional safety and security of the hardware underneath.”
TTTech Auto will give that extra boost to NXP’s middleware offerings, enabling it to offer compelling offerings for the SDVs being developed by automotive OEMs. But the chipmaker isn’t just interested in SDV’s. In fact, its objectives extend well beyond the automotive industry to include an expansive range of markets, including consumer electronics, medical, industrial, and so on, or basically any economic sectors that requires or hope to use robots. (See video of the chat with Reger below).
Trusted, safe and secure robots
The robots referenced here aren’t merely complex, highly sophisticated machines alone. The terminology, as envisaged by NXP, includes any device that can operate independently as required, process data and respond to inputs. Such devices exist already and are in daily use. What NXP and its competitors would like to add to the capabilities of these robots is the assurance that they can be used by enterprises and individuals who put a premium on trust, safety, security, reliability and dependability.
In addition to the security and safety issues, the robots or sensing devices as many in the electronics market describe them, must also be able to leverage the capabilities of artificial intelligence without necessarily being connected to the Cloud, except when desired. One other critical requirement is efficient power management and the ability to process data at the edge using what Reger called embedded LLMs.
“We are not working with LLMs in the cloud,” Reger said. “We are working here with embedded LLMs and with systems that will consume less than 10 watts. That is very, very important because I cannot switch onto nuclear power plants each time I want to have an LLM running here for me.”
The new engineers NXP expects to gain via its acquisition of TTTech Auto will be crucial in helping the company achieve these goals. Reger noted during the discussion with the Ojo-Yoshida Report that developing the skills set internally would take the company decades due to the demanding training and expertise required. By adding the engineers to Reger’s team, the company expects to vault over this hurdle and accelerate time-to-market for its offerings.
“The DNA of NXP is hardware building and hardware plus firmware, but we are not middleware specialists,” Reger said. “The value proposition of having hardware and middleware combination was there already since more than a year. [But] we cannot build that middleware expertise with our own resources from scratch. We acquired this highly skilled workforce with a great product offering to fit to our products and develop it from there.”
Bottom line:
NXP is aiming to distinguish itself in the automotive market with the TTTech Auto acquisition but the transaction promises to be even more rewarding to the chipmaker outside of SDVs because of the large number of software engineers it is also getting, all of them possessing the kind of expertise that would help the company advance its plans for AI at the Edge.
Related articles:
NXP Heats Up Auto Play with TTTech Auto Buy
NXP Nudges OEMs Toward Software-First Design
Bolaji Ojo is publisher and managing editor of the Ojo-Yoshida Report. He can be reached at [email protected].
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