Xilinx Drops Nu Horizons

Xilinx has announced it is terminating its 23 year-old agreement with Nu Horizons.

The Xilinx business is thought to represent 32 per cent of Nu Horizons business.

According to Xilinx spokesman Bruce Fienberg, the company is going with Avnet as its sole global channel partner, and regional partners where required. He said that "this was to reduce redundancies within our distribution business."

Nu Horizons executive chairman and CEO Arthur Nadata is quoted by Associated Press as saying "the company is disappointed by the decision, the move will allow it to pursue other business opportunities."

Given the customer base Nu Horizons has built in the FPGA market, it could be attractive to one of Xilinx's competitors.

Nadata pointed out that contractually Nu Horizons can return its Xilinx inventory, worth about $41m, at Xilinx's expense for a full refund, and he says that Nu Horizons financial situation remains healthy and allows it to grow the business and fund operations in the current fiscal year.

Comments

[mick]

I've no doubt Avnet will be doing its damndest to ensure there is no complacency within its organisation. That said it will have to woo those Xilinx customers happy working with the Nu Horizons team. I recall from a number of years back when suppliers were diverting customers into the distribution channel (how things change!!)that said customers did not take kindly to being assigned to a specific distributor.

[Ian W]

.... but lack of competition creates an unhealthy monopoly, complacency, fosters poor service & worst of all removes customer choice

[Hugh Jars]

Xilinx's ridiculously complex bureaucracy will be easier to work with, in the absence of competition at the distributor level.

Competition at the top drives innovation.

Competition at the bottom reduces efficiency.

-Hugh Jars