Wipro May Be Trimming Its IP Licensing Business

Indian outsourcer Wipro is considering exiting its business of creation and licensing of intellectual property (IP) in the area of connectivity, a company executive said on Thursday.

The move will be in effect a reversal of Wipro's acquisition in 2005 of NewLogic Technologies, a privately held Austrian semiconductor IP and design services company. The company was focused on offering IP and design services in the areas of Bluetooth and wireless LANs.

While Wipro's core strength was in digital chip design, NewLogic was focused on analog and mixed signal design, company executives said at the time of the acquisition. The acquisition also offered Wipro access to European customers.

Wipro now finds that the market for its portfolio of connectivity IP is not viable, because of decreasing customer interest and increasing price pressures, Pramod Idiculla, general manager for strategy in the Wipro Technologies business of Wipro, said in an e-mail on Thursday.

The company has started consultations with employee representatives regarding its proposed exit from this portfolio and the potential closure of its center in Sophia Antipolis in France, he added.

The future of the Sophia Antipolis facility, which became part of Wipro after the NewLogic acquisition, has become controversial with the French government also stepping in, according to some reports.

Wipro is in consultation with employee representatives regarding about 60 employees that may be affected, Idiculla said. The company has conveyed to the French government that it will try to reduce potential redundancies, and identify opportunities for redeployment of the employees, he added.

This will be the second time Wipro is shutting down a business focused on the creation and licensing of IP. In the 1990s, it set up EnThink, a company in the U.S. to market IP.

Wipro has not yet taken a final decision on closing the connectivity IP business, or whether it will sell off the IP assets it got from NewLogic, Idiculla said.

However if its proposals regarding the Sophia Antipolis facility are accepted, Wipro plans to exit the connectivity IP business globally, he added.