Rumour says that i2c sensor manufacturers like to put a 8051 on the silicon for running its state machine.

Each time the same mask. And a lot of the code is reusable and proven working million of times.

True, the 8051 inside the FX2 is primarily used to assist in the setup of the USB endpoints and such.  But, I used the FX2 chip to do a whole lot more.  I built a DSP-based data collection device, with FX2 chip as the USB transceiver.  I ended up having the FX2 fully involved in booting up the DSP and controlling several board features.  I directed a USB endpoint to the 8051 and decoded packets perform various features/functions.

The FX2 was a steep learning curve, but I really did enjoy using that chip. 

Makes sense.. Sounds perfect for dropping a tiny 8051 in some area of the chip : ) 

It's a great chip, although as you say quite a learning curve. Cypress didn't help matters when FX3 was released, they mixed up a lot of FX2 and FX3 documentation online, and as a result it's really quite hard to set up a development environment for FX2, the links to resources point all over the place : ( Plus then the whole Zadig thing was an irritant, I wish they had EEPROM internally to the FX2 for all that.

I think I eventually managed to have an environment that would build for FX2, but no idea how I got there, I had to install and uninstall quite a few things!

I am not planning to do any upgrade/development. Just use the existing code as is, with zero changes, if possible, It has 16K of ROM, which is sufficient. 

But I would like to use modern tools like IAR, Keil IDE etc. Do the newer 8051 derivatives have debugger (Jtag) support?

May I ask what chip is that, 8051 code + USB + ADC? Does it have a Jtag that I can use for Assembly debugging? And how do I search microcontrollers with 8051 code + extra features?

That's right, it is a commercial project, and I would like to change as little assembler code as possible. I don't want to redo it in C, because it would involve single stepping/tracing the existing code to fully understand it, which is not possible.  A contemporary IDE would give me the option of replacing some sections with C, which is desirable of course. I don't have an ICE or any debugger for the existing code, so very hard to analyze it.

Silabs have a range of 8051+ processors. The last one I used was a 100MHz variant. (And thats 2 clock per machine cycle as well !).

https://www.silabs.com/mcu/8-bit-microcontrollers

Some of the peripherals (especially ADC) are pretty good.

But a 50MHz ARM Cortex is now much cheaper and much faster.

I haven't used an 8051 for about 16 years !

MK

So it seems that it is large-scale production if MCU with your code in ROM (factory prepared read only memory) were bought from the manufacturer - if you need many thousands of these maybe some manufacturer is going to prepare a batch of them for you (especially when you still have specs from previous manufacturing runs)?

BTW - you cannot buy them from the market if you expect your code to be present in ROM.

What package is used in your project?

There seems to be a piggyback version: M85C154 (but with unknown availability) in DIP40 - where you can attach EPROM emulator on top of the MCU to make development easier, but I don't think that any "classic" 8051 has any debug interface present - only ISP (maybe those newer families have something but they would require some daughterboard - as shabaz has mentioned - to be installed in place of original part)

BTW - 89S52 is 8KB Flash only - I was assuming that your project is using external EPROM (only rarely one encounters a project of the scale that can afford preparing a dedicated ROM version - especially from the times when ROM was not programmed but etched in silicon with the rest of MCU) - 16KB seems to be present only in newer '51 families (along with USB/ADC/... options and even debug interfaces, but also with modern SMD packages)

during a quick search for 16KB FLASH '51 I have found for example C8051F321-GM (expensive and rather outdated [not recommended for new designs]) but with USB, ADC and a debug interface it seems