As consumers and markets warm to the idea of mobile payments, news from the semiconductor industry might just provide the technological tipping point needed to achieve mass market adoption in the auto industry.
Last week’s announcement of NXP Semiconductor NV’s acquisition of Austin, Texas-based Freescale Semiconductor Ltd. will create a single company with chip manufacturing capabilities second-only in size to Texas Instruments, Inc. Important not just in corporate size but manufacturing scale, the NXP-Freescale merging brings together two companies with important ties to the auto industry and its evolution with data communication and advanced driver assist systems (ADAS).
And scale is everything to the tech world in driving market adoption on the basis of cost effectiveness. This has been elusive to NXP in the decade-long quest to apply near-field communications (NFC) as a secure communication protocol for broad-based automotive application.
That scale is already taking place in smartphones, with an estimated 1.2 billion devices expected to incorporate NFC technology worldwide by 2018. Until recently, it was unclear how NFC could converge with other advanced automotive technologies in ways that were truly meaningful and practical. Now that data security has emerged as a mission-critical area of development in the Internet of Things, NFC and its secure authentication platform has found relevance in more areas than merely the unlocking of doors.
Auto industry development of autonomous vehicles, already accelerating to the point where tech companies are poaching auto industry talent, is causing much disruption across the entire landscape as technology companies maneuver to buy and to be bought. The NXP-Freescale acquisition is the latest move to consolidate two capable industry challengers and“give birth to a giant” in the words of a European research analyst.
NXP and Freescale have complementary capabilities throughout the entire connected value chain, from the development of semiconductors and processors to the advanced sensors embedded in the vehicle that provide the foundation for ADAS and, ultimately, self-driving cars. “Freescale’s core strengths,” according to NXP CEO Richard Clemmer, “are power trains and engine controls, while NXP excels in connectivity interface and data security.” Looks like the beginning of another end-to-end solutions-based resource to the automotive industry, this one touting some impressive muscle.
At a time when even the security of Apple Pay is vulnerable to outside intrusion, we welcome the added horsepower of NXT and Freescale in providing secure data handling technologies alongside advanced connectivity and ADAS at the beginning of the design stages. No patches, please.
Source: NXP, Freestyle agree to a merger – The Wall Street Journal