Simon Segars: Looking forward to the future and the ‘internet of things’

Simon Segars slides what I assume is his business card across the bar. It isn’t. Instead, there is a tiny microchip glinting at the card’s centre that packs enough power to run a Fitbit sports device or Pebble watch.

“There is a 32-bit microcontroller with a processor in there, some peripherals and some memory, and it is less than four square millimetres,” Segars says proudly. “That can clearly be manufactured at very low cost and embedded into everything and you just won’t notice it.”

His party piece, demonstrating just how small and powerful the latest microchips have become, is at constant risk of been outdated. On the morning we met, Segars had an email from a partner company reporting on a chip it had built half the size of the one he likes to shows off.

Welcome to the world of wireless technology, where opportunities expand as components shrink. That’s the view at least from ARM Holdings, Britain’s one truly global hi-tech star, whose microchip designs feature in more than 95 per cent of the world’s mobile phones, from Apple’s iPhones to Samsung’s Galaxy handsets, plus most of the accompanying tablet computers.

If Segars, ARM Holdings’ chief executive, feels the pressure of expectation to keep pace in a fast-moving industry, it doesn’t show as we sip gin and tonics in a bustling central London bar. Just over one year into the job, he has convincingly made the journey from boffin to business leader, courted by politicians eager to know how more ARMs can be created in Britain.

Segars is happy to help, but his eye is on a bigger prize: that of taking ARM from the realm of communication between humans to that of machines. The futuristic Jetson family from the 1960s cartoon series might recognise what he’s talking about, but it is still an alien concept to most.

“We are a way off from your washing machine being able to talk to your refrigerator, but with technology like that it can become a reality,” he says.

Call it what you like: intelligent networks, smart grids, the connected home – it is a breakthrough that’s been a long time coming. Now, with higher power and lower costs, it might be just around the corner. Gartner, the US technology research firm, reckons there will be chips installed in 26 billion things by 2020, a colonisation that stretches from kitchen gadgets to vending machines and heart monitors.

What with 7.2 billion active Sim cards in the world by the year’s end, according to tracking from GSMA Intelligence – the industry’s most complete dataset – eclipsing the number of humans, it is no wonder that the next phase of growth has been dubbed the “internet of things”.

Sensing an opportunity, the biggest appliance-makers are working together to overcome the main obstacle remaining: how their white goods can network with those of a rival. By seeking to establish industry standards this early, the likes of Philips, Samsung and LG are trying to learn from the early mistakes of the mobile operators. What happens next?

“The potential is whether your dishwasher works out that its motor is about to pack up before it does or your washing machine tells itself not to run a spin cycle to lower peak-time electricity usage in your house,” says Segars. “Or you could just remote control them.”

Tall and laid-back, he is a contrast to his predecessor, Warren East, who is short, intense and plays the church organ at weekends. Segars, who was born in Essex, will be 47 on Friday and lists photography as his hobby, but he drives a Tesla, hinting at a racier side. You suspect that might be par for the course for chief executives in California, where he has lived for the past seven years, even though ARM is known best as a champion of Cambridge’s technology cluster, where it started life 24 years ago.

“ARM is a global business,” he says, in an accent undeniably English, but which has picked up some transatlantic polish. “We have 40 per cent of our staff in the UK, but almost none of our customers.”

Segars spends his time criss-crossing the globe between customers, shareholders, staff and business partners, with maybe a week a month here.

“Actually where I live in the world doesn’t seem to make much difference, because wherever I am, there is something happening somewhere else,” he says, a touch ruefully.

It’s a far cry from Basildon in Essex, where he was born to a fireman father and a mother who was a teacher. Engineering attracted him from an early age: “I have taken my fair share of things apart, soldered stuff, burnt my fingers and written some code on a computer.”

Standard Telephones and Cables (STC) was a big employer in the town, so the youngster applied for a sponsorship and worked there for a year before university, every summer and after graduation.

“Where I used to work was a horrible building. Probably in the 1960s it was quite avant-garde, but it was covered in scaffolding. Somebody told me the story that it was cheaper for them to keep renting the scaffolding than to fix the problem. There were big concrete panels they were worried would fall off.”

When STC was in the process of being bought out, Segars started looking around for another job and saw an article about ARM being set up.

“I wrote to the company, saying I was interested in designing microprocessors, please give me a job. They gave me an interview.”

Segars became its 16th employee. ARM – which stands for Advanced RISC Machine – had a shaky start. Conceived as a joint venture between Apple and Acorn, the British computer maker, one of the first devices it supplied was Apple’s Newton MessagePad, an early handheld device that failed to catch on like the iPad.

In those first weeks, he remembers embellishing a video-processing chip that had been half-designed before the team left Acorn, only to be admonished by Tudor Brown, one of ARM’s founders.

“He said: ‘That’s very good, now get back to the thing you are supposed to be doing.’ ”

From those uncertain times, when everyone pitched in to woo customers, ARM, which went public in 1998, has tracked the acceleration in the market. Of the 50 billion chips that its partners have shipped in the past two decades, a fifth were shipped in 2013 alone.

ARM has remained a constant while many of the companies it charges a royalty to licence its designs have changed. Early mobile-phone pioneers such as Sharp have been sidelined, Motorola and Nokia were gobbled up, and BlackBerry stumbled. Even Samsung suffered a profits warning recently as competition bites. However, ARM is not totally impervious. Shares in the £12bn company have trickled south this year over fears that the smartphone market is running out of steam.

“I think the smartphone market has got a tonne of excitement in it and lots of growth ahead,” says Segars, insisting things should pick up in the second half of the year.

It sounds as though that can-do Californian business culture is infectious. Now all he must do is carry on talking up the prospects for those talking washing machines.

Education

Educated at Woodlands in Basildon in Essex. MSc in computer science from the University of Manchester, BEng in electronic engineering from Sussex University

Career

Joined ARM Holdings as an engineer in 1991, became head of sales in 2004, relocated to California in 2007 as general manager for ARM’s physical IP division. Appointed chief executive in 2013

Personal

Married with a 16-year old daughter and two sons, aged nine and seven. Relaxes with photography as his hobby.

“The advent of digital photography has been a great thing,” he says. “I used to mess around with darkrooms and chemicals; it was very time-consuming. Now you can do it on your computer. But you still have to understand the fundamentals of photography to do it well.”