Q: With a shared vision of taking technology innovation in wireless communications to the next level, CSR and SiRF Technology recently merged. How do CSR and SiRF Technology complement each other, and what exciting user experiences can consumers expect from the combined company's revolutionary solutions?

A: For the past year, CSR has been focused on our Connectivity Centre. The Connectivity Centre is a combination of short-range wireless technologies such as Bluetooth, FM radio (both receive and transmit), Wi-Fi, Global Positioning System (GPS), audio playback capabilities, Near Field Communications (NFC) and mobile television. Today, there is an increasing need for the combination of these technologies, especially in the fast-growing markets of smart phones, feature phones, netbooks and smartbooks. The convergence of these capabilities is the differentiating factor between consumer electronics providers, and CSR has been focused on providing this benefit to customers.

The merger between CSR and SiRF Technology gave us the opportunity to directly respond to what our customers demand in markets such as cell phones, PCs and gaming. Although CSR had a play in the location sector, it was relatively small; so we jumped at the chance to merge with SiRF who was the leader in location and Global Navigation Satellite Systems (GNSS) technologies such as GPS. The chance to combine our strength in Bluetooth and FM radio with SiRF's leading-edge location technology was too good to be true. As a result of the merger, we are now able to combine leading-edge location and short-range wireless technologies in a range of products.

Consumers can expect enhanced location solutions from our new technology. Today, location technology is only used in personal navigation devices in the car, but there can be many more benefits if you make devices location-aware. It's almost as if the Internet is being rebuilt with one new dimension—location. For example, taking pictures with mobile phones is quite popular; and with our new technology, people will now know where they took the picture. Social networking also becomes much more useful when you have a location-aware search. If you're looking for a pizza shop on Google or Bing, it's very helpful to know where you are so you can be more targeted with your search.

Q: Refuting those who believe there is a lack of innovation in the industry, CSR is a company that has continued to introduce groundbreaking connectivity and location solutions to its customers in recent months. Tell us about some of CSR's new solutions and what major evolving consumer preferences and opportunities in the mobile market initiated the need for these solutions.

A: There are multiple consumer preferences that influence CSR's solutions, but the main one is the location element. As I previously mentioned, location is much more than simply navigation. Location awareness in many devices, such as cell phones, digital cameras and cars, is going to be much more important in future. CSR is currently working on ensuring that consumers are always location-aware. Our new technology's power consumption is so low that there is always-on location awareness, eliminating the need to switch a device on or off. As well, we are working very hard to make sure our GPS technology works in places that don't have access to satellites. For instance, location-based devices have no function when they do not work in a shopping mall. So our low power and deep indoor location capability are two features consumers can expect from CSR. We are already implementing this technology in our recently launched Atlas IV and SiRFstarIV products.

Q: CSR maintains a portfolio of a number of well-known customers such as Apple, Dell and BMW. What are the advantages of enabling Bluetooth accessories for such high-profile devices such as the iPod and iPhone?

A: The prominent companies mentioned above as well as our several other tier-one customers are extremely demanding when it comes to product performance, product quality and delivery reliability. CSR's impressive list of customers is a testimony to the great quality of our products and our ability to deliver them reliably. And, of course, if our customers decide to launch high-profile accessories in their products, it means an additional growth opportunity for our customers and for us.

Q: CSR has been a major driver behind wireless convergence, developing ICs that integrate Wi-Fi, Bluetooth, GPS, FM, etc. How does CSR decide which wireless networking standards to integrate and when? How does CSR stand to benefit from convergence rather than be made obsolete by it?

A: Today, consumers desire more solutions that have a combination of Bluetooth, Wi-Fi, FM radio and GPS. There is a lot of knowledge and judgment involved with the challenging task of deciding how and when to integrate all these technologies. We are spending a great deal of time on this task, both internally and by listening to our customers. While customer demand is a primary factor in deciding what wireless technologies to integrate and when, technical feasibility is also taken into consideration. The combination of Bluetooth and FM has already happened. We feel the next big opportunity will be to combine Bluetooth and GPS, as the penetration rates of both technologies are steeply increasing.

CSR benefits from convergence because we already have all the necessary technology in-house such as Wi-Fi, Bluetooth, GPS, FM radio, NFC and ultra wideband. When a customer requests a product that calls for the combination of certain technologies, CSR has the ability to make it happen (i.e., if it makes technical sense to integrate the technologies). It can get difficult if you are missing a key piece of technology, and we are lucky enough to not be in that position.

Q: There have been a few start-ups developing Wi-Fi technology to challenge and/or displace Bluetooth technology. How much credibility do you feel these companies have in delivering the same capabilities Bluetooth provides such as with data transferring? How do you see Bluetooth developing in the next 5–10 years?

A: Obviously, there is a lot of start-up activity in Europe and Silicon Valley in the connectivity arena. These small, young companies are very energetic and aggressive, and are pushing hard to make a difference. We pay close attention to activity in the private sector because many of the start-ups have great credibility. If we discover a start-up is developing technology that is relevant to our strategy, such as a good addition or potential replacement for a technology in the Connectivity Centre, we will certainly engage in discussions with that company. For the foreseeable future, I expect that the Connectivity Centre will continue to offer us great opportunity. Leading market research firms forecast an average growth of 10 to 20 percent for these technologies during the next three to five years.

I would be very keen to speak with anyone who could tell me what will happen with connectivity and Bluetooth technology beyond five years from now, with the number of young companies emerging and the speed of innovation. I expect Bluetooth technology, specifically, to continue to experience tremendous growth as shown with the recently introduced Bluetooth 3.0 standard, a high-speed version of Bluetooth.

Q: According to various analysts, the future growth of the mobile communications market will be driven by medical applications. Supporting this belief, Bluetooth wireless technology was recently chosen as a healthcare device standard. What benefits does Bluetooth technology offer the medical field?

A: There is a new version of Bluetooth called Bluetooth low energy that can easily be integrated with traditional Bluetooth devices. The low-energy version can be implemented in smaller devices, such as medical devices (e.g., heart rate monitor), shoes or watches, enabling the battery to last for years. There is an enormous number of high-volume applications enabled by Bluetooth low energy, and the medical field is the first to pick up this technology. With Bluetooth low energy, a person can connect their phone to a heart rate or blood pressure monitor/scale which will always be on, and the phone will supply a readout of a person's weight or blood pressure range. CSR is currently working with a couple of companies, specifically in Japan, to develop Bluetooth medical products. Customers can expect the first CSR-enabled Bluetooth medical products to be available in 2010.

Q: At the GSA & IET International Semiconductor Forum, panelists discussed the lack of analog chip design and manufacturing knowledge in Europe. What is your opinion on this issue?

A: I agree that in Europe, and to some extent the U.S., it is less in vogue to work on hard sciences, whereas it is flourishing in India and China. There is enormous opportunity for young engineers to be very successful in the fast-growing field of chip design, both analog and digital, especially in Europe and the U.S.

Q: Today's foundry industry is undergoing major changes (e.g., GLOBALFOUNDRIES' recent bid to acquire Chartered). With at least two more foundry merger and acquisition (M&A) deals to be completed this year, how will this vast consolidation benefit fabless and integrated device manufacturing (IDM) companies? What does GLOBALFOUNDRIES' presence in Europe mean for CSR and other European semiconductor companies?

A: The rapid speed of today's technology development requires a large amount of capital, which means companies need scale to be a viable player. The consolidation enables the industry's capital intensity to increase, and I believe it's good for the whole ecosystem. The recent bid of GLOBALFOUNDRIES for Chartered will create healthy competition for TSMC and other primary foundry players, which in turn will help IDMs and fabless companies to continue developing next-generation products.

From a practical perspective, GLOBALFOUNDRIES' presence in Europe is helpful because, geographically, they are very close. On the other hand, CSR is a global business, so the location of these fabs is not all that important.

Q: As companies begin to raise their quarterly forecasts and consumer demand increases, many industry professionals are suggesting that the semiconductor industry is on its way to recovery. Do you feel the industry is pondering the idea of a recovery too soon? What are you currently seeing in the industry?

A: Q1 2009 was one of the toughest quarters I experienced in my professional life. Luckily CSR is currently doing a lot better. The results from GSA's CEO Sentiment Index reflect this, as we have seen a sharp uptick in the current view of the health of the industry. Many people now feel the industry is on its way to recovery, but still remain very cautious. It’s difficult to tell if this upturn will persist in 2010 or if we get a bit of a double dip and then retract before the real recovery sets in. Right now companies are very careful with their inventory. Nobody is running up inventories to get ready for Christmas because of the economy's unpredictability, and I think we're going to be staying in that mode for quite awhile. Looking beyond the current downturn, I am very optimistic. Connectivity and location are huge growth areas, and we have the products, customer relationships and every intention to make full use of that growth.

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