[nickpsecurity]

"The hardware design per se isn't that valuable"

People that spend considerable effort turning a good idea into hardware that sells tell me otherwise. ;)

"because it makes it easier to reverse engineer and clone the chips themselves."

You first said it's easy to reverse engineer and not valuable. Then, said they want closed designs to reduce reverse engineering and cloning. Which is it?

"For YubiKey themselves it's mainly the firmware"

That may be true. I can't speak to that.

[uola]

"People that spend considerable effort turning a good idea into hardware that sells tell me otherwise. ;)"

The execution and the overall ecosystem of course matters. But the hardware design, how the chips are connected, isn't really a secret as such and is easy to reverse engineer and recreate. It's just not very complex.

http://www.hexview.com/~scl/neo/

"Which is it?"

The hardware design is easy to clone, the chips themselves aren't necessarily. Chips have a very low marginal cost and a functionally identical clone could easily be sold for 1/100th the cost in volume, since all the cost is R&D. Companies therefor try to protect their IP as much as possible by making reverse engineering harder and by "owning the ecosystem". There's been cases where clones have been made by emulating chips on much more capable (but cheaper) hardware and sold for 1/10th the price.

[nickpsecurity]

"But the hardware design, how the chips are connected, isn't really a secret as such and is easy to reverse engineer and recreate. It's just not very complex."

Hardware design is a combo of how the chips are connected, the firmware, and getting it to users. Your link supports my assertion that they should put in whatever obstacles they can.

"Companies therefor try to protect their IP as much as possible by making reverse engineering harder and by "owning the ecosystem"."

Point 1 in my original comment.