(Adds Arm's comment)
March 23 (Reuters) - Arm Ltd, owned by Japan's SoftBank
Group Corp , is seeking to raise prices for its chip
designs, as it aims to boost revenue ahead of an initial public
offering in New York, the Financial Times reported on Thursday.
The British chip designer recently notified several of its
customers of a "significant shift" to its business model, the
newspaper said, citing several industry executives and former
employees.
Arm intends to alter its royalty program, ceasing to charge
chipmakers royalties for using its designs based on a chip's
value, and instead charge device makers based on the value of
the device, the report said.
As a result of this change, Arm anticipates generating
multiple times more revenue for each design it sells, since the
value of an average smartphone far exceeds that of a single
chip.
"Arm is going to customers and saying 'We would like to get
paid more money for broadly the same thing',” a former senior
employee who left the company last year told FT.
MediaTek Inc , Unisoc, Qualcomm Inc and
multiple Chinese smartphone makers, including Xiaomi Corp and Oppo, are among the companies that have been made
aware of the proposed changes to pricing policy, the report
added.
Arm declined to comment on the report when contacted by
Reuters.
The company is likely to aim to raise at least $8 billion
from what is expected to be a blockbuster U.S. stock market
launch this year, sources told Reuters earlier this month.
(Reporting by Baranjot Kaur and Shubhendu Deshmukh in
Bengaluru; Editing by Sonia Cheema and Varun H K)
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.