& cplSiteName &

Xilinx: An 'All Programmable' Strategy

Carolyn Mathas
News Analysis
Carolyn Mathas
4/3/2014
50%
50%

Acquisition strategies don't work for everyone, but there are always exceptions: Chipmaker Xilinx looks to be a member of that select group.

Like Altera Corp. (Nasdaq: ALTR), which we looked at previously, Xilinx Inc. (Nasdaq: XLNX) has used its check book to further its strategy of providing systems vendors with a one-stop-shop for communications logic in optical transport, traffic management, packet processing, and high-speed Ethernet segments. (See The M&A Way to Achieve 400G Goals.)

The component pieces of Xilinx's one-stop-shop have been put together through a series of acquisitions, along with the company's core programmable logic technology. The result is a complete portfolio for service provider, enterprise, and data center markets.

Anyone who has experienced or studied corporate takeovers, or been closely involved in M&A activities, knows that acquisitions are not without pain for both parties. Given the breakneck speed at which Xilinx acquired its capabilities, especially during the past few years, it would appear the company has perfected an M&A formula that includes targeting the companies that have already provided it with market differentiation, and which are already familiar to Xilinx on a cultural as well as technological level.

The approach appears to have paid off. In its most recently reported financial quarter (ended December 28, 2013), the company reported a 15% year-on-year increase in revenues to $587 million and a 70% increase in net income to $176 million. The company's share price has risen by 50% in the past year to $54.64, giving the chipmaker a market valuation of $14.6 billion.

Let's look at the company's acquisition history, and what that has delivered.

RocketChips
RocketChips, acquired in October 2000, provided ultra-high-speed CMOS mixed-signal transceivers serving the networking, wireless and wired telecommunications, and enterprise storage markets. RocketChips' solutions included serial backplane transceivers (single and quad 3.125Gbit/s transceivers), telecom transceivers (SONET OC-48 and OC-192), enterprise storage transceivers (Fibre channel, Ethernet), and networking transceivers (Gigabit Ethernet, 10G Ethernet, and Infiniband).

Triscend
Xilinx waited until March of 2004 to go shopping again, purchasing Triscend, a provider of configurable embedded microcontroller (MCU) technology. Triscend's single-chip platform featured FastChip development software that delivered a ready-to-customize SoC (system on chip) integrated circuit with the flexibility of a field-programmable device, at the price of a standard product and no non-recurring engineering costs.

AutoESL Design Technologies
With the purchase of AutoESL Design Technologies in January 2011, Xilinx entered a fast-and-furious acquisition phase. AutoESL Design Technologies expanded the market for FPGAs to those designing at a higher level of abstraction using C, C++ and System C. By April 2012, the results were visible when Xilinx unveiled a C-based toolset redesign for programmable systems, the Vivado Design Suite. This IP and system software supported high-capacity devices, enabling faster integration and implementation for programmable systems into devices with 3D stacked silicon interconnect technology, ARM processing systems, analog mixed signal (AMS), and many semiconductor intellectual property (IP) cores.

Omiino
Two months later, in March 2011 as part of the Xilinx roadmap for support of FPGA-based line card designs for 100G and future 400G optical transport network (OTN) applications, Xilinx purchased IP-rich Omiino. As a result, Xilinx rapidly unveiled Virtex-6 HXT FPGA capabilities for 100G OTU4 OTN designs, eased transition from the 40-nm Virtex-6 to the more capable 28-nm Virtex-7 for 400G OTN and beyond, and shored up in-house OTN expertise. (See Xilinx Acquires Omiino, Demos 100G.)

Sarance Technologies
Sarance, considered a leader in MAC (media access control) and the Interlaken interconnect protocol, delivered a very configurable, highly-FPGA-optimized portfolio of chip-to-chip interconnects with a focus on the Ethernet, Interlaken, and network search engine segments. Xilinx purchased the company in March 2011 and was rewarded with the ability to more rapidly displace ASSPs and ASICs for 40G/100G and beyond. According to Xilinx, Sarance technology had the only IP technology capable of scaling to 400G rates for bridging in an FPGA. (See Xilinx Acquires Sarence.)

Modelware
The Xilinx purchase in May 2011 of IP vendor Modelware, a provider of traffic management/packet processing silicon intellectual property (IP) cores, rapidly showed traction as the company simultaneously unveiled FPGA-based 100G traffic management reference designs based on its Virtex-6 HTX FPGA. The management IP was aimed at mobile backhaul, PON aggregation, and data center applications. The highly integrated solutions helped Xilinx equipment-makers ramp up for the high bandwidth-granular services rollouts. It also became clear that Xilinx was going for a one-stop shop strategy for high-speed networks. (See Xilinx Acquires Modelware for 100G and Chipmakers Snack on Optical Designs.)

PetaLogix
In August 2012, the acquisition of PetaLogix, an embedded Linux solutions provider, enabled Xilinx to strengthen the company's position in the embedded market. Pre-acquisition, PetaLogix distributed Linux solutions for various processors such as MicroBlaze and PowerPC. Post-acquisition, it provided Linux solutions to the Zynq-7000 All Programmable SoC.

Modesat Communications
Xilinx purchased Modesat Communications, a high-performance wireless backhaul solutions provider, in September 2012. Modesat specialized in backhaul modem solutions for microwave, E-band and non-line of sight (NLOS) markets. Mobile backhaul platforms could now use Xilinx All Programmable 7 series FPGAs and Zynq-7000 SoCs in combination with Modesat wireless backhaul solutions. Customers could keep their proprietary IP and leverage the backhaul solutions and the flexibility of the Xilinx FPGAs and SoC devices, and so get to market faster. (See Xilinx Buys Into Backhaul.)

When the dust settled…
So, what does this M&A strategy mean and how do all these deals fit together?

According to Steve Glaser, SVP of corporate strategy at Xilinx, the company has "transformed itself from a supplier of programmable logic to what we call 'all programmable', with a focus on enabling ever-more integrated hardware, software and I/O programmable devices for smarter and more flexible networks and systems. This has driven a number of developments and acquisitions, including ARM-based SoCs, multi-die 3D ICs, next-generation design tools and methodologies, and a portfolio of SmartCORE hardware IP and key embedded software IP."

He continued: "The impact of this all-programmable portfolio on next-generation systems is most visible in communications, including OTN, SDN, data center appliances, wireless radios, and wireless backhaul," added Glaser. "However, Xilinx is also enabling smarter systems across a wide range of applications that include automotive driver assistance, industrial machine vision, machine-to-machine communications and connected control, software-defined radios, and smart energy."

An example of how this is playing out was the company's presence at this year's OFC, where Xilinx unveiled OTN reference designs that, the company says, give its customers the industry's only single-chip solution for 4x100G OTN transponders and 2x100G OTN switching apps. The reference designs, in combination with Xilinx All Programmable 3D ICs and SmartCORE IP, represent an evaluation platform that is fully featured for high-bandwidth OTN apps.

The reference designs are available, and feature:

  • A 4x100G Transponder in a single Virtex-7 1140T 3D IC reference design, which is based on what Xilinx claims is the world's first single-chip 400G solution. The 4x100G Transponder design features a common control plane to manage the four 100G streams, each supporting GFEC with statistics, an overhead processor for section, path and tandem connection monitoring, and an easy-to-use GUI for defects and performance metrics evaluation.

  • The 2x 100G OTN Switching on a single Virtex-7 1140T 3D IC reference design showcases three Xilinx SmartCORE IP cores including a 100G single-stage multiplexer/demultiplexer, an Optical Internetworking Forum (OIF) compliant 100G segmentation and reassembly (SAR), and a 100G bi-directional IP block used to perform overhead insertion and extraction on up to 80 channels. The SmartCORE IP cores enable designers to construct a single-chip 2x100G MuxMapSAR for metro OTN and Packet Optical Transport systems (POTS).

    At the Embedded World event, just before OFC, Xilinx unveiled its UltraScale multi-processing (MP) architecture for next-gen Zynq UltraScale MPSoCs, extending the company's ASIC-class UltraScale FPGA and 3D IC architecture. The MPSoC architecture delivers processor scalability from 32 to 64 bits supporting virtualization, soft and hard engines for real time control and graphics/video processing, waveform and packet processing, next-gen coherent interconnect and memory, and advanced power management.

    Also at OFC, Huawei Technologies Co. Ltd. and Xilinx demonstrated a prototype 400GigE core router. Based on Xilinx's high-end FPGA, this is the first prototype system to validate 400GigE MAC/FEC/PCS/PMA technology. The Huawei core router architecture is system-ready for 400GigE interfaces.

    Industry standards for 400GigE are not yet in place, but the demonstration platform is designed to show how the marketplace will address the anticipated impact on network capacity of the Internet of Things (IoT), when up to 50 billion intelligent devices and approximately 300 billion passive "things" are ultimately expected to be connected to Internet infrastructure.

    The race to deliver 400G capabilities has begun in earnest, and Xilinx is right there in the leading pack. And it couldn't have got there without its M&A strategy.

    — Carolyn Mathas, contributing editor, special to Light Reading

    (6)  | 
    Comment  | 
    Print  | 
  • Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
    CMathas
    100%
    0%
    CMathas,
    User Rank: Blogger
    4/8/2014 | 4:06:22 AM
    Re: That is impressive...
    Glad you enjoyed both pieces. Thanks for taking the time out to comment! Given that these two companies have led their respective lives neck and neck made the piece more interestimg to do.
    CMathas
    50%
    50%
    CMathas,
    User Rank: Blogger
    4/8/2014 | 4:04:25 AM
    Re: Integrating acquisitions
    No kidding! Remember early on when Cisco bought everything in sight? What a mess that must have been to integrate.
    DOShea
    50%
    50%
    DOShea,
    User Rank: Blogger
    4/7/2014 | 9:17:39 PM
    Integrating acquisitions
    That's an incredible amount to absron and integrate. If this company is doing that smoothly, then it is doing better than most companies with multiple buyouts under their belts.
    mdraz
    50%
    50%
    mdraz,
    User Rank: Light Beer
    4/7/2014 | 2:27:01 PM
    Re: That is impressive...
    Great article. Between this and previous week's, "The M&A Way to Achieve 400G Goals," you're deep-diving into an area that few are covering, and fewer still are covering well or in an interesting way. For me, the impact different types of deals and financing have on the industry's growth today is fascinating and hits on many core issues that directly impact progress and innovation of technologies.
    CMathas
    100%
    0%
    CMathas,
    User Rank: Blogger
    4/3/2014 | 2:49:51 PM
    Re: That is impressive...
    Thanks Ray. They've been very busy and it's nice to see when strategy becomes so clear...

     
    Ray@LR
    100%
    0%
    Ray@LR,
    User Rank: Blogger
    4/3/2014 | 1:59:49 PM
    That is impressive...
    That is quite the roster -- and this article brings it into perspective.

    A very interesting read!!
    From The Founder
    Light Reading today starts a new voyage as part of a larger Enterprise.
    Flash Poll
    Live Streaming Video
    Charting the CSP's Future
    Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
    LRTV Interviews
    No Stopping Cable's Ethernet Gains

    12|9|16   |     |   (0) comments


    Vertical Systems' Erin Dunne explains why US cable operators, which now command a record-high 26% of the Ethernet market, will keep boosting their share.
    LRTV Interviews
    Fixing IoT Security Is an Ecosystem Challenge

    12|9|16   |   05:34   |   (1) comment


    Level 3 Communications' Chief Security Officer Dale Drew says service providers, manufacturers and even consumers must combine to halt massive DDoS attacks using IoT devices in botnets. The solution he has in mind includes reputation-based routing by the service provider but also more secure endpoint devices and greater consumer awareness.
    LRTV Interviews
    Cox Clears $2B in Business Revenue

    12|8|16   |     |   (0) comments


    Cox's Jeff Breaux discusses how the third-largest US MSO will reach the $2 billion revenue mark this year and plans to hit $3 billion by 2021
    LRTV Interviews
    Can Cable Climb Upmarket?

    12|7|16   |     |   (0) comments


    Carol Wilson and Alan Breznick assess cable's prospects for winning more enterprises in a landscape rocked by corporate M&A activity.
    Women in Comms Introduction Videos
    TalkTalk Exec: Find Your North Star at Work

    12|7|16   |   3:38   |   (1) comment


    Women need to find their purpose, a professional North Star, and create a personal board for themselves, according to Alex Tempest, director of partners at TalkTalk Business.
    LRTV Interviews
    Verizon: Beware Unknown Unknowns

    12|7|16   |   04:58   |   (0) comments


    Chris Novak, director of the Verizon Enterprise Solutions Risk Team, explains that enterprises who don't conduct a thorough audit of their assets often leave some things unprotected because they don't know they exist. Many times these unprotected assets are part of corporate M&A activity but left unshielded they can become a hacker's playground, he tells Light ...
    LRTV Interviews
    ETSI's CTO Talks NFV, 5G & NGP

    12|5|16   |   09:45   |   (0) comments


    Adrian Scrase, CTO at standards body ETSI, talks about the various initiatives and specifications developments related to NFV, 5G and NGP (next-generation protocols) that will underpin next-gen networks.
    Women in Comms Introduction Videos
    Korn Ferry Consultant: How to Find, Cultivate & Be the Best Talent

    11|30|16   |   4:10   |   (2) comments


    Erin Callaghan, a managing consultant for Korn Ferry Futurestep, shares strategies for companies to improve how they recruit and for women to ensure they don't get lost in the pipeline.
    LRTV Custom TV
    We Can Make the World More Sustainable

    11|29|16   |     |   (0) comments


    GeSI is a global e-Sustainability Initiative organization bringing together 40 big multinational companies around the world. According to GeSI's report, information and communication technology can make the world more sustainable. Luis Neves, chairman of GeSI, shared with us his opinion at Ultra-broadband Forum (UBBF2016).
    LRTV Custom TV
    Finding a New Way to Engage Customers & Drive Revenue

    11|29|16   |     |   (0) comments


    Mobile revenues are declining. Digicel, a player in the Caribbean telecommunications/entertainment space, has found a new way to engage customers and drive revenue. John Quinn, CTO of Digicel, shared with us its story at Ultra-broadband Forum (UBBF2016)
    LRTV Custom TV
    Do You Really Need Gigabit Infrastructure?

    11|29|16   |     |   (0) comments


    Altibox is the biggest fiber-to-the-home (FTTH) player and the largest provider of video and TV in Norway. They started out with zero customers in 2002. Now they have close to half a million households and companies attached to their FTTH business. Nils Arne, CEO of Altibox shared with us their story and insight on 5G at Ultra-broadband Forum (UBBF2016).
    LRTV Custom TV
    BT’s Openreach Strategy & Its Updates in 2016

    11|29|16   |     |   (0) comments


    A lot of developments at Openreach this year in terms of strategy and planned investments. Peter Bell, CIO of Openreach BT, shared with us the updates of Openreach at Ultra-broadband Forum (UBBF2016).
    Upcoming Live Events
    May 16-17, 2017, Austin Convention Center, Austin, TX
    All Upcoming Live Events
    Infographics
    Hot Topics
    Cable Nodes Becoming a Choke Point
    Brian Santo, Senior editor, Test & Measurement / Components, Light Reading, 12/5/2016
    Consolidated Snaps Up Fairpoint for $1.5B
    Iain Morris, News Editor, 12/5/2016
    Small Arctic ISP Caches Netflix in New Way
    Mari Silbey, Senior Editor, Cable/Video, 12/7/2016
    Like Us on Facebook
    Twitter Feed
    BETWEEN THE CEOs - Executive Interviews
    Eyal Waldman, CEO of Mellanox Technologies, speaks to Steve Saunders, CEO of Light Reading, for an exclusive interview about the 100 GB cable challenge, cybersecurity and much more.
    Join us for an in-depth interview between Steve Saunders of Light Reading and Alexis Black Bjorlin of Intel as they discuss the release of the company's Silicon Photonics platform, its performance, long-term prospects, customer expectations and much more.
    Animals with Phones
    A Mobile Safari Click Here
    Literally.
    Latest Comment
    Live Digital Audio

    Even when there's a strong pipeline of female talent in the comms industry, it tends to leak all the way to the top. McKinsey & Company says women experience pipeline leakage at three primary points: being unable to enter, being stuck in the middle or being locked out of the top. Each pipeline pain point presents its own challenges, but also opportunities to stop the leak. Wireless operator Sprint is making a conscious effort to improve its own pipeline from new recruits to the C-suite, and it wants the rest of the industry to do the same. In this Women in Comms radio show, WiC Board Member and Sprint Vice President of Enterprise Sales Nelly Pitocco will give us her take on the industry's pipeline challenges. Pitocco, who joined Sprint in May and has spent 20 years in the comms industry, will also offer solutions, share how Sprint is tackling the challenge within its own organization and take your questions live on air.