On Cores
Meditations on the semiconductor and IP industries
By Warren Savage, CEO, IPextreme

Thursday Dec. 04, 2008

Beware the Unflatteners

In Thomas Friedman’s now famous “The World is Flat” book published in 2005, Friedman describes how the world economy has become “flattened”. Fueled by technology, lowered trade barriers, nearly all leading edge companies are now multinational and borders are almost virtual.

<img src="//www.design-reuse.com/blog_img/blog57/world_is_flat[1].jpg" border="0" align="left" hspace="5">

Blue chip companies started investing in India 20 years ago, and the practice only accelerated in the ‘90’s. In the early part of this decade, many venture-backed companies were setting up headquarters in Silicon Valley with R&D offices located in Asia and Eastern Europe. As now everyone knows, the advent of the internet and cheap broadband connections changed our world.

But Friedman warns of “unflatteners”.

One of these unflatteners for the IP business has been the shaky regard for intellectual property in a rapidly evolving China, which is moving from an agrarian communist state to a modern “capital-ish” world economic power.

A disregard for rules can be a dangerous thing as epitomized by the latest melamine problems emanating from China. China first struggled with this problem when suppliers of dog and cat food were found to be adding melamine to the formula to boost profits. Pets died all over the world and few people noticed. In the latest incident, dairies were caught adding melamine to milk which went into the human food chain. When children start dying from tainted baby formula and Cadbury is recalling tainted chocolate, the world starts paying attention.

The terrorist attacks in Mumbai in India last weekend represent another serious unflattener. Terrorism in key technology centers can severely disrupt the world economy, especially when there is a concentration of an industry in certain geographies. It’s very important for the Indian government to come to grips with the threat of terrorism as it has an economic effect on the growth the Indian economy and could seriously erode all of its achievements of the last 10 years.

We have seen some serious structural changes in the global economy over the last decade and we could be standing on an inflection point where we either move forward with the progress made, or regress (temporarily) a little until our world is a little better prepared for change.

Posted by Warren Savage on Thursday Dec. 04, 2008 | Add a Comment

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About the Author

Warren Savage, President and CEO of IPextreme, is a well-known and published authority in the field of semiconductor intellectual property. He has a long history of pushing the envelope of design methodology from his work in fault tolerant computing at Tandem Computers in the 1980's and driving reliable design metholologies into commercial practice at Synopsys for its DesignWare IP product in the 1990s. Much of his thinking became embodied in the seminal book on IP reuse, the Reuse Methodology Manual. Warren is taking his vision to the next level with his latest company, IPextreme, which is focused on enabling broad commercialization of IP captive in large semiconductor companies.