Editor: Linley
Gwennap In This Issue
Acquisitions Drive Market-Share Gains According to data gathered by The Linley Group, the networking silicon market grew only 1% in 2007. Several companies greatly exceeded this rate because they completed acquisitions during the year. (For market-share purposes, we treat acquisitions as though they took place at the start of the year.) Infineon gobbled up Texas Instruments' large, but languishing, DSL business, propelling the company to the second-ranked position in total ASSPs for wired communications behind Broadcom. By acquiring Agere, hitherto unranked LSI became the seventh-largest supplier. NetLogic entered the top-15 by taking over the last piece of Cypress's search-engine business. More acquisitions are likely in coming years as organizations with weak product portfolios but strong market positions combine with competitors in the opposite situation. Larger companies, moreover, are better able to amortize the relatively fixed cost of interoperability testing and product certification. Growth in sales of wired-communications ASSPs was held back by a decline in the broadband market. The largest broadband category is DSL. While acquisition enabled Infineon to double its share, the combined Infineon-TI entity actually gave up ground. Top-ranked Conexant's DSL revenue also fell in 2007, as did that of VDSL-leader Ikanos. In this context, Broadcom did well, maintaining even revenue in 2007 compared with 2006, capping off a few years of meteoric growth. Broadband accounted for 21% of the wired-comm ASSP market. Ethernet accounted for 31% of the market and grew 6%. The main impetus of growth was products for Gigabit Ethernet switching, which experienced a 16% growth in sales. Fast Ethernet switches continue to sell in high volume, providing further room for GbE-switch sales to grow. Bigger than all of its ASSP competitors combined, Broadcom dominates the GbE switch market. Industry revenue from network processors topped $250 million, up 8% from 2006. Intel extended its lead as the company fulfilled orders for its new IXP23xx and IXP28xx NPUs. The 2007 NPU revenue of LSI/Agere and Wintegra was about even with 2006. EZchip emerged as the leading vendor shipping only 10Gbps-and-above NPUs, more than doubling its sales in 2007. Bay Microsystems, another vendor of 10Gbps+ NPUs also grew. Complementary to networking silicon, high-end embedded and communications processors increased sales about 6%. Although its products are not often found in deeply embedded designs, Intel dominates the embedded CPU market with its x86 CPUs. The company's 9% revenue growth offset slower growth of several other vendors. Xilinx's decline in FPGA revenue in 2007 pulled the overall FPGA market down 3%. Weak sales of FPGAs for communications systems caused most of the decline. Industry sales into this segment declined 7%, in 2007. Halfway through 2008, the dominant mood is not one of optimism or pessimism but of uncertainty. First-half revenue reported by public companies has been better than one might expect given that economists are ratcheting down their forecasts for GDP growth. The outlook given by major system OEMs, such as Cisco, is cautious, but lean supply chains should mitigate major swings in communications chip revenue in 2008 and beyond. —Joe Complete market-share data appears in our report Communications Silicon Market Share 2007.
This week Teranetics sampled the industry's first dual-port PHY for 10Gbps Ethernet over copper. The startup was also first to market with a 10GBase-T PHY in a single package. Teranetics' first generation PHY is designed into products from Intel, Neterion, Extreme, Mellanox, and other leading vendors. The new TN2022 dual-port chip dissipates 6W (typ) per port, which is about the same as that of the single-port PHYs recently introduced by Aquantia (5.5W) and Solarflare (5.9W). Manufactured in 65nm process technology, the TN2022 is packaged in a 25mm by 25mm BGA. This size is slightly larger than the 21mm single-port PHYs from competitors. Teranetics also offers a single-port version of the device; both versions support triple-speed operation and therefore can connect with older GbE and FE end points. In addition to XAUI, these devices include an XFI port that could be used to connect directly to a MAC or Fujitsu's 10GbE switch chip. Alternatively, the chip can bypass the copper PHY in a XAUI-to-XFI mode when connecting an optical module. The dual port PHY will save significant board space when designing 24-port and 48-port 10GbE switches. With three vendors offering competitive products, OEMs will have plenty of choices and the price of a 10GBase-T PHY should fall well below $100 per port, which sets the stage for lower switch-port pricing in 2009. If the PHY vendors qualify their products for production this year and OEMs follow cost-based pricing, 10GBase-T volumes should ramp aggressively in 2009. —Jag Complete coverage of 10GBase-T PHYs appears in our upcoming report A Guide to Ethernet Switch and PHY Chips.
Join us on September 16th, in San Jose for a Linley Tech seminar on the technologies driving the future of enterprise and data-center networks. The program will feature in-depth presentations on the newest chips and technologies for switching and server connectivity from leading suppliers of OEM products for this market. Jag Bolaria, senior analyst with The Linley Group, will kick off the program with an overview of the market, technologies, equipment-design, and silicon trends for designers of enterprise and data-center networking equipment. The remainder of the day will include talks and panel discussions covering a broad range of topics such as 10GbE switching, 10GbE backplanes, and low-latency system interconnects. To get an idea of what you can expect, see last year's detailed program. Regular admission is $495, but is free to qualified individuals who register early. The seminar is intended for network-equipment vendors, server OEMs, system designers, network service providers, enterprise-network managers, software developers, press, and the financial community. This Linley Tech seminar will be held at the DoubleTree Hotel in San Jose. Space is limited; register today to reserve your place. This seminar is sponsored by Freescale, AMCC, Netronome, Xelerated, Dune, and Fujitsu.
Despite a slowing world economy in 2008, sales of communications ICs will continue to grow at a modest rate through 2012 according to The Linley Group. Slow-growing, mature economies continue to invest in communications equipment for consumers, enterprises, and carriers. Emerging economies, however, are growing much faster. China is upgrading its network infrastructure to support 3G cellular and faster broadband services, for example, while India is rolling out such services for the first time. These investments in equipment translate into purchases of semiconductors. "Communications Silicon Market Forecast 2007—2012" provides market forecast information for more than fifteen categories of wired and wireless communications semiconductors plus embedded microprocessors and FPGAs. This new report will enable companies to assess the competitive landscape of key product markets and plan their investments accordingly. Wired semiconductor categories include network processors, 10 Gigabit Ethernet components, broadband transceivers, security processors, and optical transport ICs. The report also includes forecasts for interconnect chips, network search engines, and microprocessors used in communications applications. Wireless components covered include baseband processors, Bluetooth and GPS chips for handheld systems, and application processors. The report is available in either a single or corporate license. The single license includes a brief printed text summary providing analysis of the data and a non-printing PDF providing market forecast tables for more than fifteen product categories. The corporate license provides the printed summary, a printable PDF file, and a Microsoft Excel workbook containing the data. Order by August 31 and save $300 on Communications Silicon Market Forecast 2007—2012. For more information, visit our web site.
To receive Linley Wire via e-mail, click here
|
