SAN JOSE, Calif. New offices, staff, products and services were among the initiatives being used by European companies exhibiting at the Embedded Systems Conference (ESC) in Silicon Valley last week in an effort to expand their sales in to the U.S. market. However, one theme that was found with all the European companies at ESC was that they tend not to be impacted by fluctuations in the euro/dollar exchange rate as almost all said they tend to buy their components with a dollar pricing.
One company beginning to make waves here is XMOS Semiconductor Ltd. (Bristol, England), which has just released its first product, a four-core processor chip implementing its ‘Software Defined Silicon’ programmable technology. Each core delivers up to 400-MIPS of performance and the chip costs $10 in volume.
Richard Terrill, vice president of marketing at XMOS, has just recruited the company’s first U.S.-based employee and is planning to open an office in Silicon Valley. Ed Brown, formally with Broadcom Corp. and Oxford Semiconductor Ltd., will provide local technical support for U.S. customers and provide the link to the European operation.
“He will responsible for day-to-day engagements with customers and working with our Northern Californian-Based sales rep company. I wanted someone based here who could meet with companies opportunistically at short notice.”
Terrill, originally from Britain, has been based in the U.S for 20 years, most recently with Velogix previously with Xilinx, Lightspeed, Cadence and Altera. With XMOS he is based in Bristol but his experience in the U.S. market is of use to XMOS.
Terrill said: “Within a few hundred yards there legal and finance experts that are setting up new companies every day. The expertize is here you just have to take advantage of it,” said Terrill. “A chip company has to have a Silicon Valley presence.” Another advantage of a local office is that one of the venture capital companies backing XMOS, Foundation Capital, is based in Menlo Park. The other backers of XMOS, Amadeus Capital Partners and DFJ Esprit, are based in the U.K.Congatec AG (Deggendorf, Germany), which produces embedded computing-on-modules, is also just starting to hire U.S. staff. At ESC it announced that it has incorporated a U.S. entity, Congatec Inc., and is looking for a location for a California-based office which will eventually employ about 10 staff.
Ron Mazza has been working as an independent representative for Congatec out of San Diego in Southern California for a couple of years and now, as U.S. general manager, will manage a network of around 30 independent sales reps.
“Congatec was set up three years ago and the plan was always to expand to serve the U.S. market but Europe and Asia took priority. But as these operations are now running profitably it is time to raise our profile in North America,” said Christian Eder, head of marketing at Congatec. A second member of staff, a field applications engineer, has also been recruited and undergone training at the company’s German facility.
Meanwhile the acquisitive embedded computer board maker Eurotech Group SpA (Amaro, Italy), came to ESC to launch formally in the U.S. its merged U.S.-based subsidiaries. Applied Data Systems, bought in early 2007, and Arcom, which became part of the group in April 2006, have been combined as Eurotech Inc. and had revenues reaching approximately $45 million in 2007. It employs 150 people with more than half of them involved in R&D.
With its recent expansion in Asia with the acquisition of 65 percent of Advanet/Vantron (Okayama, Japan) in October 2007, the Eurotech Group now has a “good balance” of sales by geographical area according to president and CEO, Roberto Siagri. “We have 40 percent of sales in the U.S., 22 percent in Europe and 33 percent in Japan. The merger in the U.S. will provide a number of operational efficiencies with manufacturing gaining advantages in both purchasing power and efficient operations while the combined resources of the sales operations will extend our reach in to the market,” said Siagri.On a smaller scale but also looking to expand its U.S. sales impact is Radiocrafts AS, (Oslo, Norway), a developer of standard RF modules for operation in the license-free ISM bands at 315/433 /429/868/915/2450 MHz. The modules are based around Texas Instruments silicon and the company was present at ESC as part of the TI booth and was last year selected by TI as a third-party provider of modules and engineering services for their low-power wireless products.
Radiocrafts was founded in 2003 and released its first products in 2004. Peder Martin Evjen, the company’s managing director, explained that while the company has already set up an extensive distribution network across 30 European countries it has made little headway in the U.S. so far.
During ESC Evjen was meeting with potential reps and distributors. “Our link with TI is helping us with our plan to expand our U.S sales operation. They have the local contacts which are useful for us and are actively giving us advice. It would be helpful for us to have the same distributors as TI as there are a number of customers who think about buying the discrete devices but do not have the skill or the time to develop their own module design. TI helps up to promote our modules to overcome these limitations.”
“We might sign up with a national distributor covering the whole country or a number of distributors or reps spread out geographically. In Europe we have very technical local design-in distributors but in the U.S. we might use a combination of reps and niche distributors who can do the same thing for us. We need people out on the road looking for customers and not just sitting back waiting for orders. We don’t have good visibility in the market here yet.”
“If we set up a network with a lot of local reps we will probably need to hire someone here to run it,” said Evjen. “The alternative for us is to sign up a nationwide distributor which works with the reps and has one person within its organization to be our point of contact.”
“We are also looking to set up a company here and this will be needed if we hire someone to run the sales network but we can also sign distribution agreements without having a local company.”
Pls Programierbare Logik & Systeme GmbH, (Lauta, Germany), was founded in 1990 and supplies development tools for 16-bit and 32-bit microcontroller families with a focus on Infineon Technologies, STMicroelectronics, PowerPC, ARM7, ARM9 and XScale devices. It has been actively selling in to the U.S. and attending ESC for 12 years. One of the company’s founders Thomas Bauch explained that around a quarter of its sales are in the U.S.
“We have extended the support of the various architectures and this is enabling us to expand our sales here,” said Bauch. Pls has had a subsidiary company in San Jose since 1998 with a local employee who provides the link between the distributors and customers and the headquarters in Germany. “It was difficult to find the right person to work for us here with the knowledge and enthusiasm. We have recruited a German who has been working the U.S. for a number for years before joining us.”One of the more unusual booth-holders at ESC was the European Patent Office (Munich, Germany) an international authority set up to grant European patents and which enables a single patent in any of the three official languages – English, French or German – to provide patent protection in 34 states. The EPO has more than 6,500 employees from 30 nations at five sites in four countries. It granted its first patent in 1978 and has received 2.5 million applications with 200,000 of those applications coming in 2007.
Alfred Wenzel, of the EPO, explained that while the organization regularly attends about 20 technology events across Europe, including the Hannover Fair, Cebit and more recently Embedded World, it had not attended an event in the U.S. before. Wenzel was accompanied at ESC by two EPO patent examiners who were on hand to provide expert advice to designers and engineers. “The patent systems in Europe and the U.S. are very similar except in the fields of software and computers. In Europe you cannot protect software by patents and we are seeing lots of visitors to our stand that do not realize this difference.”
Even though a lot of manufacturing has moved from Europe east, a presence in Silicon Valley is still seen buy European companies as being necessary to win design-ins and make a global impact.
Welcoming visitors to ESC was the life-sized robotic ‘Raffe. 17 feet tall when its neck is raised and though the beast appears to have wheeled feet, it actually walks on these wheels which give it variable traction control, and more importantly, allow it to be winched up onto its trailer. The giraffe uses a small 12 horsepower engine burning Propane gas. The engine has no direct connection to the giraffe other than to spin generators that charge the main system batteries. From there the batteries power a 3 horsepower electric motor that only needs 1.5 horsepower to move the giraffe. Therefore the machine uses a true hybrid fuel-engine-generator-electric motor design. The robot uses a number of embedded computing products supplied by Kontron including a JREX single board computer. More info on www.electricgiraffe.com
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