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Wallowing in an analog backwater
July 10, 2007
The Wall Street Journal today has a front-page article on Linear Technology. It suggests that Linear engineers Jim Williams, Robert Reay, Steve Pietkiewicz, and Bob Dobkin are wallowing in a tech backwater. And from the WSJ’s perspective, that’s a nice place to be: “Linear has built one of the world's strongest profit fortresses by staying strictly at the fringes, where competition is low and margins are still high. Away from the semiconductor industry's frenzied center stage, this midsize company makes 7500 arcane, unglamorous products that solve real-world problems for a long list of customers. Instead of the better-known digital chips that power the brains of the world's computers and bring in 85% of the industry's revenue, Linear makes so-called analog chips that are too cheap for customers to haggle over, but perform chores too important to ignore.”
So what’s Linear’s impact on the test industry? The WSJ reports good news and bad news. The good news is that Linear makes the parts test-equipment companies need. Agilent, for example, “uses a smattering of Linear chips to keep power systems running smoothly inside oscilloscopes that measure electrical signals and sell for $100,000 or more.” The bad news is that Linear doesn’t make much of a test-industry customer: “Mr. Dobkin, the chief technical officer, won't spend much for test equipment. Instead, he encourages chip designers to scour flea markets for used voltmeters, oscilloscopes, and the like to test the electrical performance of their chip designs. Aging models that cost $75 or less are ideal, Mr. Dobkin says, and if repairs are needed, engineers can learn by fixing the machines.”
Update: read a related post, "'Man does not live by bits alone,'" here.
Posted by Rick Nelson on July 10, 2007 | Comments (2)
