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Keeping your enemies closer

Without strategic partnerships between competitors, technology would develop a lot slower. By Philip Ling.

Competition is healthy, but being the best pays more bills. The problem is you can't have one without the other and any company that acts as if it can is eventually brought back down to earth: even Microsoft.

Partnering with a competitor may seem like commercial suicide, but it does happen. Admittedly, the partners are generally individually much bigger than the partnership, and recent example of two large companies coming together to form a new venture is Hitachi and STMicroelectronics (see box). The two recently consolidated a long history of collaboration by forming a new company called SuperH (http://www.superh.com).

Far from being commercial suicide, partnering with a competitor, by definition, means there are at least two companies striving to achieve the same goal. For the adoption of new technology, this can play a crucial role in raising confidence in the product. It is not uncommon for companies competing for the same design wins to collaborate behind closed doors in order to make sure they are all pulling in the same direction.

This isn't as sinister as it sounds: it is the way most working groups operate. Clearly, there is a limit to the amount of information that will be shared, but it is only by working together that standards are first raised and ultimately adopted by the industry.

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Author
Graham Pitcher

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