Light Reading
At OFC, two companies stood out for having acquired their way to the top of the 400G components table.

The M&A Way to Achieve 400G Goals

Carolyn Mathas
News Analysis
Carolyn Mathas
3/27/2014
0%
100%

It was clear at OFC 2014 that service providers want flexible provisioning and seamless upgradeability for 100G and 400G.

While there were several products and capabilities discussed and introduced at the show, a couple of vendors stood out in terms of the depth of their portfolios, and both have a rich history of strategic acquisitions that have helped them get where they are today.

The companies are Altera Corp. (Nasdaq: ALTR) and Xilinx Inc. (Nasdaq: XLNX): In some ways, you could say they "bought their way" to achieving their initial 400G roadmap goals.

Altera's 400G story
At this year's OFC, Altera introduced OTN solutions for 400G that offered a defined path to 1 Tbit/s. New products included the TP0516 Altera SoftSilicon 400G Transponder/Muxponder and the TPOC226 SoftSilicon single-chip 20-channel any-rate mapper with segmentation and reassembly (SAR). The TPOC226 addresses advanced optical demultiplexer unit (ODU) cross-connect systems for OTN-based transport networks. These products represent what Altera claims are the first fully integrated 200G and 400G OTN solutions. (See Altera Introduces OTN Solutions for 400G and Beyond at OFC 2014.

Because Altera's SoftSilicon devices are available, and are built and validated on reference platforms that closely resemble target applications, system provider development risks are minimized. And, naturally, FPGA platforms also mitigate the risk, as requirements from both standards bodies and customers continue to morph.

"We believe our SoftSilicon technology, and the industry's first fully-integrated 200G and 400G OTN solutions, the TPOC226 and TPO516, will bring customers leading-edge process technology and superior power and performance advancements that will address their systems design challenges in optical transmission," said Scott Bibaud, senior vice president of Altera's Communications and Broadcast business.

So, how did Altera arrive at these products? Looking at the company's acquisition history gives a good indication. From its inception through its first 16 years, Altera went it alone. Then, in 1999 it bought a small Santa Cruz, Calif. company, Boulder Creek Engineering, for an undisclosed amount. What it got at the time was a technology called "Signal Tap," a logic analysis tool (not related to this). But what it ended up with was a new Santa Cruz division, up to its eyeballs in the development and launch of Altera's now-famous Nios. (See Altera Enhances Processor from 2001!)

Shopping spree begins
It wasn't until 2010 that Altera went shopping again, and this time the road would clearly move down the communications path. The eventual industry upgrade to 100G and 400G levels was inevitable, and optical protocol standards demanded unprecedented flexibility that application-specific integrated circuits (ASICs) and application-specific standard products (ASSPs) could not provide.

Altera recognized that the programmability at the heart of FPGAs would be the logical solution.

With the December 2010 acquisition of Avalon Microelectronics, a small but recognized provider of silicon-proven customized IP for optical transport network (OTN), SONET/SDH and Ethernet, Altera expanded its portfolio of customizable IP solutions. (See 100G Watch: Chips Get Merger Fever.)

Avalon -- go ahead, sing along, you know you want to! -- not only was the sole IP supplier for the 100G OTN solutions implemented in Altera FPGAs, it also provided solutions to optical equipment manufacturers, test and measurement companies, and military contractors.

With its strong system expertise in transmission applications and detailed Altera FPGA knowledge, Avalon made sense as a buy. With the purchase, Altera promised relevant products, reduced solution costs, and a goal of market leadership in 400G/1Tbit/s OTN IP application development.

Over to OTN
There was a relatively short wait until the next acquisition. On April 30, 2013, Altera purchased T-Pack, a wholly owned subsidiary of Applied Micro Circuits, and its portfolio of FPGA-based optical transport network (OTN) products. T-Pack's SoftSilicon OTN solutions provide mapping, multiplexing and cross-connection of packets over OTN. The company pioneered standard chipset solutions that target FPGAs but are similar to ASSPs. As a result, T-Pack has displaced ASSPs for 10G, 40G, and 100G OEM designs. (See Altera Buys T-Pack From AppliedMicro.)

With the purchase, Altera also gained cost-optimized 10Gbit/s OTN mappers for metro applications and 10 x 10 Gbit/s OTN cross-connects using partial reconfiguration for Packet-Optical Transport Systems. The acquisition, combined with Avalon's capabilities, enabled Altera to accelerate and expand its OTN solutions roadmap and support.

Hot on the heels of T-Pack, in May 2013 Altera announced the acquisition of Enpirion, the developer of integrated power conversion products known as PowerSoCs, and integrated power management solutions for enterprise, telecom, industrial and storage segments. The company was recognized for its high efficiency, low noise characteristics, exceptional thermal performance, high reliability and ease-of-use. (See Altera to Deliver Breakthrough Power Solutions for FPGAs with Acquisition of Power Technology Innovator Enpirion.)

This deal, valued at about $141 million, gave Altera the key power technologies it needed, enabling it to develop the high-frequency switching, low-power, small footprint technology it needed.

"We are pleased with the quick results of our strategic acquisitions which enabled us to integrate IP, software APIs, and FPGAs creating what are very much like ASSPs, but which still provide the programmability to allow our customers to differentiate their systems," said Bibaud.

Sometimes, it's recognizing what you don't know, or don't have time to develop in-house, that is key to being a leader. Altera's strategic acquisitions clearly moved the company rapidly to the forefront in the OTN space.

In a separate article, I will look at how Xilinx has advanced its cause through M&A activities.

— Carolyn Mathas, contributing editor, special to Light Reading

(2)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
CMathas
0%
100%
CMathas,
User Rank: Blogger
3/27/2014 | 9:16:24 PM
Re: Consolidation
Good one - we'll see consolidation as well as more interesting forms of financing, stay "tuned."

 
DOShea
50%
50%
DOShea,
User Rank: Blogger
3/27/2014 | 9:13:20 PM
Consolidation
I guess I think of the optical components sector being ripe for consolidation, but it sounds likes it has already been happening.

I'd say more, but just decided it was a good time to listen to the entire "Avalon" album again...
Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Huawei Video Resource Center
Interview With Rick Talbot, Principal Analyst, Current Analysis

10|31|14   |   2:12   |   (0) comments


At the NFV Open Cloud Forum 2014, Rick Talbot shared his positive feedback about the holistic and open approach that Huawei adopts for SDN and NFV. He also found the open sharing at the event valuable as it features different perspectives from Huawei experts, telecom operators, industry analysts as well as security experts.
LRTV Huawei Video Resource Center
Interview With David Snow, Principal Analyst, Current Analysis

10|31|14   |   2:24   |   (0) comments


David Snow talked about his understanding of Huawei and its SoftCOM strategy at the NFV Open Cloud Forum 2014, saying that Huawei's wide approach combining IT and CT expertise, introducing big data and analytics into solutions and contributing to the OpenStack community particularly resonate with him and make the company stand out in the industry.
LRTV Huawei Video Resource Center
Interview With Roz Roseboro, Senior Analyst, Heavy Reading

10|31|14   |   3:13   |   (0) comments


Roz Roseboro commented on Huawei's data center capabilities and NFV solutions at the NFV Open Cloud Forum 2014, saying that in addition to covering all three key domains of compute, storage and networking, the company also emphasizes the importance of management capabilities and professional services, which are essential in making NFV a reality.
LRTV Huawei Video Resource Center
Interview With Michael Howard, Co-founder & Principal Analyst, Infonetics Research

10|31|14   |   5:25   |   (0) comments


Michael Howard talked about SDN, NFV, and OpenStack adoption at Huawei's NFV Open Cloud Forum 2014. Particularly, he pointed out that Virtual Enterprise CPE is the top NFV use case that operators plan to invest in over 2014 and 2015 to deliver new enterprise services through virtualized functions.
LRTV Huawei Video Resource Center
Interview With Jerry Caron, Senior Vice President, Current Analysis

10|31|14   |   3:11   |   (0) comments


At Huawei's NFV Open Cloud Forum 2014, Jerry Caron from Current Analysis said that orchestration and management are key to realizing SDN and NFV for global carriers, and the approach that Huawei is taking, with its FusionSphere Cloud OS at the core, is in the right direction to address the challenges.
LRTV Documentaries
Broadband Battles

10|31|14   |   01:39   |   (0) comments


This year's Broadband World Forum featured a number of show floor battles focused on access gear, components and coffee.
Jonestown
Mobile Backhaul: Going to the Dark Side?

10|30|14   |   2:26   |   (1) comment


Heavy Reading's Patrick Donegan shares his view on a dark trend that bubbled up at Light Reading's annual backhaul conference in NYC.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview With CEO of SwitchCom

10|30|14   |   4:13   |   (0) comments


SwitchCom, an IT company based in Angola, recommends a variety of Huawei solutions and hardware to their customers in the energy industry.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview With Ethiopia's Ministry of Water Irrigation & Energy

10|30|14   |   4:08   |   (0) comments


Gosaye Mengistie of Ethiopia's Ministry of Water Irrigation & Energy discusses the collaboration with Huawei in that country.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview with Dongfang Electronics Corporation

10|30|14   |   5:46   |   (0) comments


Dongfang Electronics Corporation, headquartered in Chengdu, China, is one of China's largest manufacturers of power generators and contractors of power station projects.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview with Zimbabwe's Customers

10|30|14   |   3:31   |   (0) comments


Representatives of Zimbabwe's Ministry of Power and Development discuss the energy needs of their country as well as new areas of improvement due to enhanced ICT capabilities.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview With Colbún Chile

10|30|14   |   4:29   |   (0) comments


In Chile, an aging energy infrastructure was in dire need of a modern update. Claudio Valenzuela of Colbún discusses how Huawei's ICT solutions continue to provide crucial information to improve the grid and how an in-country engineer is a cricial asset.
Upcoming Live Events
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
February 10, 2015, Atlanta, GA
May 6, 2015, McCormick Convention Center, Chicago, IL
May 30, 2015, The Westin Peachtree, Atlanta, GA
June 9-10, 2015, Chicago, IL
Infographics
WhoIsHostingThis.com presents six of the world's most extreme WiFi hotspots, enabling the most epic selfies you can imagine.
Hot Topics
Microsoft's Skype Embraces WebRTC on IE
Sarah Reedy, Senior Editor, 10/27/2014
FTC Slaps AT&T With Throttling Lawsuit
Sarah Reedy, Senior Editor, 10/28/2014
Wheeler Gets Down With OTT
Mari Silbey, Independent Technology Editor, 10/29/2014
China's MVNOs Hit the Wall
Robert Clark, 10/27/2014
Let's Not Kill SDN & NFV With Silos
Francois Locoh-Donou, Senior VP, Global Products Group, Ciena, 10/28/2014
Like Us on Facebook
Twitter Feed