Broadcom Unveils New HDTV Chip
LR Cable News Analysis Alan Breznick, Cable/Video Practice Leader, Light Reading 12/15/2006
Broadcom, which introduced its first digital TV (DTV) chip nearly two years ago with only limited success, is angling to capture a greater share in the fragmented market by targeting the high-end HD sets that are just hitting the stores. Although few of the estimated 25 million to 30 million HD-capable digital sets in U.S. homes support the 1080p resolution today and there's little TV programming available in the format, the number of sets is slated to start growing rapidly next year as electronics manufacturers introduce new high-definition DVD players and video game consoles.
"We expect it to be a much larger percentage of the TV segment next year," says Stuart Thomson, director of marketing of digital television products for Broadcom's Broadband Communications Group., who estimates that no more than 10 percent of flat-panel HD sets support 1080p today. "The TV manufacturers are certainly going to drive it hard."
But, as a late entrant into the HDTV market, Broadcom faces stiff competition from numerous other, more entrenched semiconductor makers, such as Trident Microsystems Inc. (Nasdaq: TRID), Advanced Micro Devices Inc. (NYSE: AMD), and NXP Semiconductors N.V. (Nasdaq: NXPI). The field also includes such cost-conscious players as Taiwanese chip manufacturer Mediatech.
"They’re a little too late to the digital TV market," says IdaRose Sylvester, a senior analyst for IDC . "There are dozens and dozens of companies doing chips for digital TV."
At the same time, Broadcom faces competition from several large Japanese TV manufacturers that are now developing the chips for their own digital sets. Industry analysts expect that trend to grow as electronics makers seek more control over their brands and production costs.
"There's not a whole lot of wiggle room," Sylvester says. "It's a very difficult play."
Yet Broadcom executives, who have made a name for the company in the cable set-top box and cable modem markets, think they can succeed by leapfrogging over other silicon makers to offer feature-packed chips specially designed for the next-generation HD sets. They're particularly targeting the manufacturers of flat-panel liquid crystal display (LCD) sets, which are battling plasma screens for HDTV market supremacy.
"1080p is a great differentiator," Thomson says. "It's to the advantage of LCD manufacturers to make 1080p a requirement in consumers' minds."
Broadcom says the new digital TV chip, known as the BCM3563, offers a display resolution of 1920 x 1080, or more than 2 million pixels. Besides the 1080p outputs, the chip is designed to support picture-in-picture and picture-by-picture display modes, as well as integrated Advanced Television Systems Committee (ATSC), National Television Systems Committee (NTSC)/PAL, and QAM demodulators.
In addition, Broadcom says the new chip can upconvert other HD programming entering the TV set to the 1080p format, including 720p and 1080-interlaced (1080i) content. It also uses low-power 65 nanometer process technology.
Besides the chip's features, Broadcom officials are touting the cost savings gained from simplifying the design and integrating all the functions on a single chip. They decline, however, to quantify the savings or reveal the chip's price.
Industry analysts applaud Broadcom's effort. They say the company has a better shot at succeeding with its high-end strategy than if it tried to compete with other DTV chip makers merely on price.
"Actually, it's a pretty big deal," Shyam Nagani, principal analyst for IHS iSuppli . "They've done a great job with a tremendous amount of integration."
But analysts still have their concerns. Nagani, for one, suspects that Broadcom may have packed too many unnecessary features into its new chip, making it a bit too pricey for the markets.
"It has a lot of input/output functions that may not be used by the customer," says Nagani, who estimates that the chip will cost somewhere around $20 a unit. As a result, he says, "it may be a little more expensive than the competition."
Broadcom is now supplying samples of the chip to "early access partners," which it declines to reveal. Plans call for the company to start shipping chips to DTV set manufacturers in volume by next summer.
— Alan Breznick, Site Editor, Cable Digital News