One of the ways "intelligent," connected vehicles are influencing business is their growing impact on the global semiconductor industry.
For proof look no further than the reported discussions between Qualcomm (QCOM) - Get Report and NXP Semiconductors(NXPI) - Get Report . One of the tings in these talks, however, is presumably what would be NXP's role as a manufacturer of chips for the automotive industry.
The trend toward more computers and software systems in vehicles -- and fewer mechanical ones -- has been growing for years. With the rush to create autonomous technology that allows a car to know its position on the road, sense other vehicles and obstacles and guide the car safely to its destination, the need for more computing power in every vehicle has accelerated. At the same time, the market for desktops has all but disappeared as consumers and workers switch to tablets and phones.
A takeover of NXP by Qualcomm could be valued at $30 billion, affording the latter a foothold in the budding market for chips that increasingly control a vehicle's every function, from infotainment to navigation to communication and, eventually, to its ability to self-drive.
NXP Chief Executive Richard Clemmer told The Wall Street Journal in an interview last year that his company expected to play a larger role on the rising computerization of automobiles via his company's $12 billion acquisition of Freescale Semiconductor.
Amit Daryanani, an analyst for RBC Global Markets, said that "assuming a reasonable valuation is paid, this would be an attractive acquisition for Qualcomm and a good use of $30 billion in cash Qualcomm currently has on its balance sheet."
Qualcomm has mostly sat on the sidelines while merger frenzy seized the semiconductor industry. Merger activity in 2015 hit a record; deals have totaled $200 billion in value, including $75 billion so far this year.
Two weeks ago, Japanese system-on-a-chip maker Renesas said it would pay $3.2 billion to buy U.S. chipmaker Intersil (ISIL) . The companies said that automotive business could account for half the combined post-merger revenue.
Semiconductor giant Intel (INTC) - Get Reporthas joined with German car maker BMW and Israeli software maker Mobileye (MBLY) to jointly develop self-driving models that could be sold by 2021. Strategic Analytics said late last year that complete driverless technology isn't like to be introduced until 2025. IHS Automotive forecasts that more than 20 million autonomous vehicles will be on the road by 2035.
Before that happens, however, there will be hundreds of millions of partially automated cars sold, crammed with the most advanced chips.
Doron Levin is the host of "In the Driver Seat," broadcast on SiriusXM Insight 121, Saturday at noon, encore Sunday at 9 a.m.
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.