Atheros First With Multimode
"All our chips are now in production," Craig Barratt, VP of technology for the Sunnyvale, Calif.-based company, told Unstrung after his presentation at the Salomon Smith Barney technology conference in New York City. The company now has 802.11a/b/g multimode silicon -- as well as its original 802.11a chipset -- in production, according to Barratt.
Atheros' competitors, which include such heavy hitters as Broadcom Corp. (Nasdaq: BRCM), Intel Corp. (Nasdaq: INTC), and Intersil Corp. (Nasdaq: ISIL), are not expected to start shipping dual-mode chipsets before the fourth quarter -- or in Intersil's case, early next year.
"This doesn't surprise me," says Ken Furer, an analyst at IDC. "Atheros are still the guys that are out there at the moment." Atheros made its name as the first company to develop and deliver chipsets based on the 802.11a standard.
However, Furer questions exactly how many multimode chipsets Atheros is shipping. "I don't know how they're spinning the term," he says. "Whether they're actually earning revenues from these chips, or just shipping a small number to customers."
Atheros has about 45 customers. Big names include Sony Corp. and Philips Electronics NV.
Chipsets that support both the popular 802.11b standard, which uses a 2.4GHz radio to deliver data at up to 11 Mbit/s over a range of up to 300 feet, and the enterprise-orientated 802.11a specification, which uses the 5GHz band to deliver up to 54 Mbit/s over a range of up to 200 feet, are expected to be popular with corporate customers, as such technology will save them from having to upgrade entire corporate WLAN systems (see It's WLAN Seduction Season). Support of the 802.11g specification is actually a bit of a non-issue at the moment, as it has not been properly finalized by the Institute of Electrical and Electronics Engineers Inc. (IEEE).
Atheros' Barratt also says the company is eventually planning to go public, although he won't make any predictions as to when, given current market conditions. Some analysts and industry figures have suggested that the company could be a ripe target for acquisition, but Barratt says this not part of the company's plan.
Furer says he wouldn't be surprised if the company did plan to go public, perhaps even within a year. "Wireless is definitely where investors are throwing money now," he says.
However, Furer does wonder if the company can survive in the long term. He estimates that Atheros booked $4M in revenue in 2001. "They must be burning cash," he says of the company, which has so far scored $98M in funding (see Unstrung's Top 25 Startups). An IPO could be a way for Atheros to bank some more money while waiting for the market to pick up, he suggests.
Barratt, however, reckons that Atheros will be a survivor. He compares the wireless LAN chipset market to the graphics chip sector a few years ago. Back then, he says, there were 30 or 40 startups competing against major players like Intel; now only a few firms such as Nvidia Corp. and ATI Technologies Inc. remain. In the same manner, Atheros will be a WLAN winner, Barratt predicts. — Dan Jones, Senior Editor, Unstrung