Britain leads charge in chip design

A new report shows that Britain has the largest share of independent chip design companies, putting it far ahead of other European nations. According to the "European Chipless & Fabless IC Design House Report," published by U.K. research firm Future Horizons, British companies claim 39.2 percent of a total of almost $2 billion in overall revenue from European contract design, "fabless" and silicon intellectual property companies. Fabless chip companies focus on chip design and rely on third-party manufacturers to produce products.

Industry analysts say such companies--particularly chip intellectual property (IP) companies--are a growing force in the processor industry. Contract design companies are often used by large manufacturers as a dedicated source of chip designs. The biggest chip companies, such as Intel, Texas Instruments or Infineon, still control most of their own design and manufacturing processes, but are increasingly turning to third-party companies for designs or intellectual property. For example, Intel uses ARM designs along with its own technology in its XScale chip architecture for embedded devices, such as handhelds or tablet PCs.

ZDNet U.K.'s Matthew Broersma reported from London.

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