Cable Tech

BroadLogic Chip Targets Altera, Xilinx

BroadLogic Network Technologies Inc. is going after a segment dominated by Altera Corp. (Nasdaq: ALTR) with the introduction of a dense, low-power cable QAM chipset that, the supplier claims, will usher in an era of sub-$100 "universal" edge QAMs and more "personalized" services for cable MSOs.

BroadLogic's latest entry is the TeraQAM BL85000, a QAM chip that can pump out up to 32 channels per port, compared to about 8 channels in most QAM devices. On the power side of the equation, BroadLogic claims its chip needs only 1 watt per QAM, versus an estimated 4 watts per QAM required by competitive equipment. With everything factored in, BroadLogic believes it can chop the QAM system bill of materials by about 50 percent. (See BroadLogic Unveils Dense QAM Chip.)

BroadLogic, a startup that counts Comcast Interactive Capital , Time Warner Investments , Cisco Systems Inc. (Nasdaq: CSCO), and Bright House Networks among its backers, believes its the time is right for its new chip. MSOs are replacing analog spectrum with digital bandwidth that can be used for more personalized multicast and unicast services and applications such as video on demand (VoD), switched digital video (SDV), and network DVRs. Many of those new services will be fed through millions of "universal" edge QAMs (UEQs) -- bridge devices that can dynamically share the resources required to deliver all forms of digital video, voice, and high-speed Internet services. (See Universal Edge QAM Market Heats Up.)

"All of these trends basically point to demand for increased QAM capacity," says Ian Olgierson, senior analyst with SNL Kagan. "But to take that big leap in capacity and that big leap in deployment volumes you need a corresponding reduction in price."

The good news for MSOs is that UEQ prices are already dropping steadily. BroadLogic president and CEO Danial Faizullabhoy estimates that unit prices are at about $200 today, down from $300 to $400 a year ago. He thinks UEQs outfitted with BroadLogic's new silicon can help vendors get unit prices below the $100 mark, an economic threshold that could enable cable operators to deploy a QAM per home.

"We believe we are enabling a new era for a more personalized network," Faizullabhoy says. "As content and switched digital video and VoD grows and consumers demand more on-demand content... the shift will [require] almost 100 times the number of QAMs that are out there."

But to hit that, BroadLogic believes a "breakthrough" in chip density, price, and power consumption is necessary. The 16-channel version of its QAM chip is priced at $500 in 1,000-unit quantities.

Deals still in the making
BroadLogic expects to start shipping samples this month and to reach full production by year's end. Candidates for the chip include Arris Group Inc. (Nasdaq: ARRS), BigBand Networks Inc. (Nasdaq: BBND), Cisco, Harmonic Inc. (Nasdaq: HLIT), Motorola Inc. (NYSE: MOT), Vecima Networks Inc. (Toronto: VCM), and possibly Tandberg Television .

Infonetics Research Inc. directing analyst Jeff Heynen believes BroadLogic is entering the market at the correct time, but doesn't expect the QAM chip portion of the vendor's business to start ramping up until the first half of next year. "There's certainly a market for that [BroadLogic's new QAM chip], there's no question about it."

BroadLogic's primary competitors in that market are Altera and (to a lesser degree) Xilinx Inc. (Nasdaq: XLNX), which make field- programmable gate arrays (FPGAs) that edge QAM vendors integrate into their own platforms. The anomaly on the market is LiquidxStream Systems Inc. -- it's the only edge QAM maker that makes its own silicon. Montreal-based LiquidxStream has no intentions to sell its chip, which can support 36 QAM channels per port, to other edge QAM vendors, according to Tony Pierson, the vendor's VP of business development.

The UEQ is just one of the markets BroadLogic is targeting for its new chip. It also intends to win integrations for edge QAMs designed especially for hotels and other multiple dwelling units (MDUs), as well as a new fiber node QAMs that are still under development.

The TeraQAM is the third product in BroadLogic's lineup. The San Jose, Calif.-based company also makes the BL12000, a wideband receiver that can bond multiple downstream cable channels, and the TeraPIX, a video processor capable of converting digital signals to analog. (See BroadLogic's Disruptive Digital Chip, BroadLogic Trims D-to-A Costs, and Vecima Box Lets MDU Residents Keep Old TVs.)

Faizullabhoy said he anticipates BroadLogic turning its first profit by the end of 2009. The company, which employs about 50 and was founded in 2002, has raised about $49 million. (See BroadLogic Collects More Cable Cred.)

— Jeff Baumgartner, Site Editor, Cable Digital News

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