Intel ramps up Russian R&D

Intel has effectively taken over two companies specializing in high-technology R&D in Russia and, in the process, more than doubled its research efforts in one of its most important emerging markets.

The Santa Clara, Calif.-based chipmaker has agreed to take over engineering design teams and license intellectual property from Elbrus MCST and Unipro, which perform research on semiconductor design, compilers, hardware design and Java, among other technologies. Elbrus has been working on 32-bit and 64-bit processors that conceivably could compete against Intel's chips, according to various Russian news reports.

"Instead of outsourcing to them, we hired them," Intel spokesman Chuck Mulloy said. "This is a rare opportunity, where you can get intact design teams."

Intel is not buying the two companies, but it is hiring most of their engineers and has licensed the intellectual property of both businesses, Mulloy said. Elbrus MCST and Unipro were privately held, but originally grew out of Russian government projects.

Russia is emerging as a center for R&D for Western companies and as an expanding market for computers and servers. Intel often works with Russian server manufacturer Kraftway, and it has targeted Russia, along with India and China, as one of its three major growth markets. Last year, the chipmaker started to make its first venture investments in Russian companies.

For its part, the Russian government is trying to make the country more attractive to Western technology businesses as well as to its own entrepreneurs. Earlier this year, it issued decrees that allow inventors at state-sponsored research institutions to keep patents generated from their work. Before that, the patent rights reverted to the institutions.

In all, around 500 employees will join Intel as a result of the transaction. The company already has a research center in Nizhny Novograd that employs around 400 workers. That Intel operation got started in a similar manner to the new ones, said Mulloy: It was an independent facility that the company scooped up.

Elbrus and Unipro operate research facilities in Moscow, St. Petersburg and Novosibirsk.