Even as National Semiconductor Corp struggles to right its finances, Brian Halla has been on a shopping spree since he took over as CEO in May 1996. The acquisitions center on a single strategy: to assemble all the pieces that will allow National to establish itself as a premier supplier of ‘system-on-a-chip’ PC technology, the prospect of assembling processing, memory, multimedia and other chip functions on a single piece of silicon. When Halla was product chief at custom chipmaker LSI Logic Corp, he had a giant version of ‘Mr Potato Head’, the children’s plug- together toy, placed in the lobby of his group’s headquarters. The message was simple – LSI can integrate, on a single custom chip, a mixture of semiconductor functions that are more commonly implemented using separate components. Adopting the motif, ‘The System-on-a-Chip Company’, LSI went on to become a market leader in highly-integrated chips for mobile phones, DVD players, digital cameras, video games and the like. But it intentionally steered clear of the kind of PC applications that would put it head-to-head with traditional chipmakers – above all, Intel. Two years after leaving LSI to lead National Semiconductor on a similar ‘system-on-a-chip’ crusade, Halla now thinks he has assembled all the pieces necessary to apply those same integration concepts to the mainstream – to personal computers in the form of ‘PC-on-a-chip’ designs, and also to a broader set of computer devices that are due to emerge over the next few years. In doing so he is building a very different company from the National Semiconductor he inherited in from previous CEO Gil Amelio, who left the company for Apple leaving a mediocre product portfolio and no future hits under development. To date, the company has bought Cirrus Logic Inc’s PicoPower business, a specialist in chipsets for small form factor devices; Mediamatics Inc, which makes multimedia home connectivity products; Future Integrated Systems Inc, a PC graphics company; Gulbransen Inc, a digital audio technology maker; ComCore Semiconductor Inc, a maker of digital signal processing for LANs; and, of course Cyrix Corp, the established maker of Intel x86 clones and graphics chips. At the same time, National has spun off its Fairchild division, removing around $450m (15%) from the company’s annual revenues. Whether it has completed all the necessary acquisitions is debatable – after all it is shooting at a moving target and the technical challenges are immense. Nevertheless, few industry people industry understand the odds better than Halla.
