Qualcomm Buys Arteris Tech, Team

SAN JOSE, Calif. — Can you maintain a business after your top customer buys your technology and the engineering team that developed it? That's the question Arteris will attempt to answer after Qualcomm decided it liked the FlexNoc network-on-chip so much it bought the company -- or most of it.

Qualcomm acquired for an undisclosed sum the FlexNoc intellectual property and about 43 engineers in France working on it. The SoC maker agreed to give Arteris FlexNoc updates on "an agreed upon schedule and provide certain engineering support," a Qualcomm spokesman said.

The updates will support the existing Arteris pattern of quarterly updates responding to user requests and a major upgrade every three or four years, said K. Charles Janac, president of Arteris, which now consists of about 23 people including about six field application engineers.

Arteris gets an unlimited use license to its FlexNoc patents, now owned by Qualcomm, as well as access to the source code and the right to modify it as needed. The result is a unique model competitors are already questioning.

"I've never seen anything like this and I've been in five startups," said Janac in an interview atARM Tech Con.

Archrival Sonics says without a dedicated engineering team the company will not be able to provide the kind of configuration and support SoC designers require. Janac says the agreement provides adequate access to Qualcomm engineers for support on terms he will not disclose.

"We spent a lot of time making sure this business is viable," Janac said, noting his needs for a road map, ability to respond to customer change requests, and support. "We think we have the mechanisms in place to do that."

Although its business situation is unusual, the Qualcomm purchase validates the technology, and Arteris retains outposts in hot spots such as Silicon Valley, China, Korea, and Taiwan. "I think Arteris will continue to do very well," said Will Strauss, principal of market watcher Forward Concepts of Tempe, Ariz.

Qualcomm has been a customer of Arteris for about three years. It uses its FlexNoc "in most of its chips," Janac said. Arteris has more than 50 other customers using it in about 180 chips, he said.

In May, Sonics sold ARM a license to use its on-chip networking technology patents. At that time the two said they would collaborate on Sonic's next-generation offering.

The Arteris technology got its start in a network processor architecture designed by a Paris-based design team at Conenxant. When the chip vendor laid off the team in the downturn of 2001, employees negotiated for rights to the technology and formed their own company around it.

Texas Instruments was one of the first customers for their work, which morphed into FlexNoc in 2003. It wound up as the interconnect used inside TI's OMAP4 in 2008 and then the OMAP5, which powers, among other things, the Amazon Kindle.