Editor: Linley
Gwennap In This Issue
If you missed our recent seminar on Embedded Network Security Design, you can download the proceedings and get the latest information from Freescale, AMCC, LSI, SafeNet, Cavium, cPacket, Hifn, and The Linley Group. For a free copy, visit our web site. Intel today announced a broad new strategy to enter the SoC market. The first product in this plan, the EP80579, is about to enter production, but the company is developing at least 15 new SoC products, according to Gadi Singer, general manager of Intel's SoC Enabling Group. These SoC products will target various applications, including industrial, networking, consumer, and mobile. The EP80579 (code-named Tolapai) combines a Pentium-M processor with a complete north/south-bridge chip set and a security engine, all on one 90nm device. Pricing ranges from just $40 for a 600MHz version (without security) to $95 for the top-end 1.2GHz model. With thermal design power (TDP) of 11W to 21W, the processor does not match the power efficiency of competing RISC processors in networking and communications applications. Offering a significant cost and power reduction from previous Intel solutions, the EP80579 will be most successful in industrial applications, point-of-sale terminals, and similar equipment. With the exception of Canmore, a consumer-optimized version of Tolapai, most of Intel's future SoCs will use the Atom CPU, which is much more power efficient than Pentium-M. These future chips will be built in 45nm or below, offering further reductions in power and cost. As a result, these Atom-powered devices will be more competitive with RISC-based SoCs. Intel still has a lot to learn about deeply embedded applications, and the company has already taken a few unsuccessful stabs at the consumer market. (Anyone seen a Viiv lately?) But Atom shows that the company can design a low-power x86 processor, and its leadership process technology gives it a tremendous potential advantage over fabless competitors. If Intel follows through on this new strategy, it could make some waves for RISC processor vendors. —Linley Complete coverage of Tolapai appears in our recent report A Guide to High-Speed Embedded Processors.
Last week, TranSwitch announced an agreement to acquire Centillium. Expected to close in 4Q08, the cost for the acquisition is $42.8 million, consisting of $15 million in cash and 25 million shares of TranSwitch stock. TranSwitch acquires Centillium's engineering teams, products, and annual revenue of $22 million as well as cash (and cash equivalent) worth $40 million. By combining resources, the new TranSwitch expects to reduce operating expenses by $10.5 million. TranSwitch is projecting a product margin of 60% and a return to profitability by 1Q09. Centillium became successful as the dominant supplier of ADSL chips to NTT (Japan). But the company's revenue has been falling since early 2006, when NTT switched its focus to PON and VDSL deployment. Although Centillium developed EPON and VoIP components, these products were not successful enough to reverse its decline. Before the acquisition, TranSwitch's primary product lines included framers, mappers, and controllers for Sonet, SDH, and ATM. The company also licenses HDMI technology. In May, TranSwitch announced its Taurus platform, which will be the basis of future GPON components. The company is currently taping out the first of these components and should sample it by September. By acquiring Centillium, TranSwitch gains not only EPON and VoIP components but also new customers such as Oki, which is using Centillium's Mustang ONU controller. The deal does not include Centillium's DSL business, which it earlier sold to Ikanos. It's a great deal for TranSwitch as well as Centillium, its executives, and its investors. TranSwitch gets Centillium and at least $8 million in net cash at the cost of some dilution in its stock. Centillium investors get an instant return, while the company's executives get a nice cash payout. Together, the companies have a better chance of being profitable than either did alone, as consolidation and cost-cutting measures should help the bottom line. For the long term, TranSwitch plans to increase its revenue by winning business in FTTx and media gateways. It should be able to grow Centillium's EPON business in Japan. For other EPON markets, GPON, and media gateways, however, TranSwitch is well behind competitors. Although the acquisition strengthens TranSwitch, the company still faces some fierce challenges. —Jag Additional coverage of TranSwitch appears in our recent report A Guide to High-Speed Interconnects. Last week, Andrew Schmitt broke the news on Broadcom's unannounced GPON controller. The story starts about four years ago, when Alcatel transferred GPON technology to Freescale, which developed a PowerPC-based ONU controller. Unfortunately, the GPON market remains small, limiting Freescale's sales opportunity. After Freescale completed its GPON chip, Alcatel asked the semiconductor vendor to create a second-generation device with an integrated MOCA interface, to support Verizon's fiber deployment. After seeing little return on its initial GPON effort, Freescale was unwilling to develop a new device. Alcatel then offered its GPON technology to Broadcom—its leading DSL supplier—so Broadcom could develop the MOCA-integrated chip. As Schmitt details, Broadcom is now sampling this device. We expect Broadcom to eventually ship the bulk of the GPON components for Verizon's rollout. Given the slow GPON ramp and Broadcom winning Verizon's business, the sole remaining GPON opportunity could be in China, but GPON remains in the lab there. Consequently, we see little opportunity for Broadcom's GPON competitors to gain revenue in 2008 and 2009. Instead, we expect smaller vendors such as Iamba to look for a suitable buyer, and established GPON vendors such as BroadLight to look for new markets to apply their core technology. Freescale continues to pursue the GPON market and will announce new products later this year. The major FTTH opportunity remains EPON, where PMC-Sierra is the leading supplier and Teknovus is a rapidly rising star. EPON is enjoying growth due to increasing deployment in China. This growth is likely to be bursty, and it remains unclear what mix of EPON versus GPON will be deployed by Chinese carriers. For these reasons, Broadcom has no active EPON program, so the two leading EPON vendors can take a temporary sigh of relief. —Jag Additional coverage of the GPON market appears in our report A Guide to Broadband Chips.
Save the date! Mark your calendars for Sept. 16 for a Linley Tech seminar on Data Center Networking. This event will cover the newest chips and technologies for data center networks and cover GbE/10GbE switch chips, 10GbE server NICs/controllers, and low-latency system interconnects. Further details will be available soon. Sponsored by Freescale, AMCC, Netronome, Xelerated, Dune, and Fujitsu.
We recently completed a white paper on the subject of Single-Chip Control/Data-Plane Processors. This paper examines the trend toward combining control-plane and data-plane processing on a single chip. It discusses the technologies driving this trend, the common features of these chips, their advantages and disadvantages, and how they are being deployed today and into the future. The complete white paper is available at no cost on our web site. Click here to download the PDF.
EE Times: PCI Express Goes Everywhere Nikkei Electronics: Intel's Embedded Atom Did you know that The Linley Group also publishes a newsletter focused on semiconductors for mobile communications and consumer electronics? Get our analysis of this market with the latest edition of Linley on CE:
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