Cypress Semiconductor Corp. - Immersion

some follow up to the announcement of the IMMR - CY cooperation:

from Cypress Semiconductor Corp. recent P/R abour 2Q 2009 results -

>>+ Cypress has licensed Immersion Corporation’s patented TouchSense^® haptic (touch feedback) technology to deliver single-chip user interface controllers with tactile feedback. Cypress will integrate this technology with its TrueTouch touchscreen and CapSense capacitive touch solutions to improve the end-user interface experience in mobile phones, GPS systems, keyboards, white goods and other systems.

+ Sharp Communications Group has selected Cypress’s TrueTouch solution to power the waterproof touchscreen on its KDDI Sportio water beat mobile phone.

+ Cypress announced several design wins for its CapSense touch-sensing solution, a low-cost, reliable, button-free interface for thousands of consumer electronics and white goods products. New CapSense designs include LG’s W53 and W54 LCD monitors, four new Acer Aspire notebook computer models, and Whirlpool and Indesit washing machines. CapSense is also being used in Wacom’s Bamboo™ tablet, a graphical input device that converts handwritten text and drawings into digital documents.

+ HP has selected CapSense technology to drive the touch-sensitive TouchSmart™ control panel on the new HP Photosmart™ C4600 All-in-One Series printer.

from Seeking Alpha conference call transcripts:

>>John Barton - Cowen

Thank you very much. If I could go back to the comments about touch screen and the competitive dynamics, I don’t know, T.J., Chris, whoever, or Norm -- but what are the current dynamics when customers are looking at silicon solutions versus sub assemblies? How much engineering expertise is out there in the customer base? How much do customers really want to have control of the firmware so they can make changes, et cetera? I mean, how do you see that today and how do you see that playing out over the next year or so?

Norman P. Taffe

Good question. As far as the evolution of that space, certainly one of the things I think driving our success right now is we’ve definitely seen it move from a -- the large suppliers looking for a silicon based solution as far as versus maybe the very early market, more module based. So they do want more control over the supply chain. I will tell you that one of the things that allows us to differentiate and keep the real players fairly small at this point is there’s a ton of expertise required, not just in terms of the product itself but in terms of understanding the whole stack-up in terms of the screen itself, the IPO material -- that it is not a simple market from that standpoint and still all of the largest handset players do rely on the touch screen solution providers to have significant investment in terms of supporting them and helping them design these touch screens. They are not -- it is a much more difficult problem to solve than the cap sense problem, even though it’s based on similar technology. [I’d say that’s a good thing.] It allows us to differentiate.

But we have moved into the phase where we see the predominant design [inaudible], silicon based, looking for us to provide the silicon while they choose the partners. And our early on strategy of partnering with every major ITO supplier, we think is starting to pay significant dividends in terms of design-ins.

I think that will still play out for the next year-and-a-half or so, where the complexity will drive us this way. Over time, you know, the benefits we bring in software in terms of the -- adding features, you know, a good example, just the immersion announcement we made in this press release where it’s another capability that because we have a programmable solution, they can now add that [inaudible] capability on a touch device that’s programmable, and now gives that [inaudible] in the same location as the touch but also improves the performance of [inaudible]. It’s not just run by a different processor. Again, that is another key thing and as we continue to add those kinds of features, it makes it harder and harder for other people to get designed in. That’s key to the strategy.

T. J. Rodgers

On your specific question of module versus chip, in the beginning you have a strange new thing like a touch screen and all you want to do is get in the market and have your touch screen be competitive, you are tempted to go to a module. What happens though is very shortly thereafter with cell phone manufacturers, you want to disaggregate the supply chain. You do not want to be paying a module manufacturer mark-up for an LCD screen, for example, you could buy yourself probably cheaper than the module manufacturer could.

So we’ve focused on what we do, which is silicon, and getting that right and partnering in the module side as opposed to trying to make modules.