Atmel
Atmel – the world's third largest supplier of smartcard security chips, in a very competitive market – is aggressively driving cost reduction and diversifying into new applications of its core technology. The company was founded in Silicon Valley in California in 1984 and has had a Scottish base in East Kilbride, in the Glasgow area since 1999. With an annual turnover of $1.5 billion it employs 7,500 people worldwide, with 160 jobs in Scotland, where it acquired Motorola's smartcard chip business, inheriting a skilled workforce and tapping into Scotland's global reputation for trustworthiness.
Recent challenges faced by the company have included rationalisation, an aggressive restructuring of its parent company and increasing competition in its market area. It has countered these with improved products with higher profit margins and increased R&D activity, leading to high product confidence, with 20 million chips now being tested every week at the Scottish plant.
We have a very constructive relationship with Scottish Enterprise. They have done everything they can for us.
– ANDY BEAR
Atmel Corporation is an industry leader in the design and manufacture of advanced semiconductors, with focus on microcontrollers, non–volatile memory, logic, radio frequency (RF) components and sensors. When Atmel acquired the Motorola business in East Kilbride it was primarily for the value of the people. Today the manufacturing engineers are mainly involved in the process of wafer thinning and test whilst the designers apply the technology to diverse areas requiring security. In addition to bank cards and mobile phone sim cards, Atmel is leading the way in chip design for a wide range of products from electronic passports (where fingerprints can be embedded in the chip) to Pay TV. Applications that prevent counterfeit components being used, thus preserving the integrity of branded goods, are also being developed.
The semiconductor sector has always been volatile and is an increasingly competitive environment. However, it is not an easy sector to gain entry to as the stringent security requirements take time to master. As the semiconductor industry in Scotland consolidates and Atmel seeks new recruits far and wide, Scotland remains an attractive location, especially for Scots looking to return to their roots, or overseas engineers and designers who like the quality of life that Scotland offers. Atmel has attracted people from Singapore, India and Eastern Europe.
On a cost basis Scotland competes on a level playing field with North America and Europe, while the big advantage Scotland has over the Far East is its strong reputation for trust and integrity. Banks and telecommunication companies need to be absolutely confident that the product they are investing in is safe and that the source of production is politically stable. Scotland scores highly here. So, the combination of a technically able workforce, political stability and a trust in the high security content of product stands Scotland in good stead.
How Scottish Development International helped
Scottish Development International has helped Atmel over the years with grant aid, helping to secure three rounds of Regional Selective Assistance funding, both towards the initial purchase of the business and to help grow the business. At the time of Atmel's acquisition of the East Kilbride site, Scottish Enterprise organised a number of high level visits to the HQ in San Jose to help explain the benefits of locating in Scotland – not least the prominence of its financial sector.
Scottish Enterprise Lanarkshire has been instrumental in securing funding to encourage R&D activity. They have also helped with training and participated fully in business consultation over the years.
Lessons learned
There are three key lessons Atmel has learnt in the Scottish context: The value of trust and stability; the value of people; and the value of government support.
The need to innovate is key to all business success. But in the semiconductor sector it is essential. Atmel is an exemplar in taking up that challenge.