Comms chips

100G Watch: Chips Get Merger Fever

Acquisitions among the semiconductor players have provided a nice boost of 100Gbit/s product news:
  • Altera Corp. (Nasdaq: ALTR) acquired Avalon Microelectronics this week for a sum too small to trigger disclosure rules. Avalon was an intellectual property vendor, selling chip designs particularly in high-end areas. The design group Altera highlighted in its release was 100Gbit/s Optical Transport Network (OTN) interfaces, although Avalon has also made a big deal of its 40Gbit/s work. (See Altera Acquires Avalon Microelectronics and Supercomm: Chips Look Toward 40/100-Gig.

    The 100Gbit/s generation is going to be an interesting Field Programmable Gate Array (FPGA) battleground as both Altera and Xilinx Inc. (Nasdaq: XLNX) are pushing chips to 28Gbit/s transceiver speeds (and, coincidentally, 28nm manufacturing processes). (See Xilinx Preps for 400G, Supercomm: Chips Look Toward 40/100-Gig, The 400-Gig Vision.)

    And, to that end, Altera took away one of Xilinx's teammates, as Xilinx was using Avalon's cores.

  • Altera had seen a partner of its own get snapped up, albeit not by a direct rival, when Tpack got acquired by Applied Micro Circuits Corp. (Nasdaq: AMCC) during the summer. (See AppliedMicro Pushes Toward the Edge.)

    That might lead you to wonder who else is left in this intellectual property space. Two companies still independent are Sarance Technologies Inc. and Xelic Inc. , both Xilinx partners.

    There's also Sembarc Ltd. , a small Irish startup born from the ashes of Flex (Nasdaq: FLEX)'s old design services efforts.

  • Referring back to the AppliedMicro/Tpack deal, AppliedMicro has introduced what it says is the first muxponder for the OTU4 standard for 100Gbit/s OTN, developed in conjunction with Tpack. This comes on the heels of the 100Gbit/s OTN transponder chips the company announced last month. (See AMCC Intros 100G Muxponder and AppliedMicro Intros 100G OTN.)

  • Deployment of 100Gbit/s optical gear might rev up more strongly in 2011 than expected. That's the guess from Ciena Corp. (NYSE: CIEN) CEO Gary Smith, speaking during the company's Dec. 9 earnings call.

    "I understand folks saying 2012 will be widespread deployment of 100G. I actually think we'll see more than we think in 2011," Smith said. (Transcript courtesy of Seeking Alpha.)

    Other 100Gbit/s happenings of late:

    — Craig Matsumoto, West Coast Editor, Light Reading

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    spc_markl 12/5/2012 | 4:15:53 PM
    re: 100G Watch: Chips Get Merger Fever


    One of the biggest sourcing problems is with the gearbox chip for the LR4 CFP.

    Mark, Telecom Pragmatics

    Camil_mat 12/5/2012 | 4:15:52 PM
    re: 100G Watch: Chips Get Merger Fever



    The gearbox chipset is a new concept and it is still being invented. And it is not like we don't have time. 10G volumes took a long time to meet volume expectations.  

    It is also a flawed concept. Optical component companies are getting hammered on cost and adding such an expensive chip to the module BOM does not make things easier for them.



    Pete Baldwin 12/5/2012 | 4:15:51 PM
    re: 100G Watch: Chips Get Merger Fever

    Good point about the gearbox, although I've been thinking of it from a different direction. Adding the cost to the BOM shouldn't be a problem; yes, it's harder to sell a more expensive module, but they'll all be that expensive.

    The bigger concern might be that so much of the value has gone to the electronics rather than the optics. Maybe that's why some optical companies (Opnext, e.g.) are doing that gearbox on their own?

    Camil_mat 12/5/2012 | 4:15:50 PM
    re: 100G Watch: Chips Get Merger Fever


    I appreciate your perspective. Let me add a couple more data points here.  First, there are some alternatives out there that do not need the gearbox. For example, SR-10 and LR-10 map the 100G payload directly on to the optics. These alternatives are low cost enough to gain quite a bit of traction. 

    Regarding your second point, Optical component suppliers are constrained with low R&D budgets to show some profitability and I just wonder if they could continue and invest in developing leading edge optics and electronics. 


    spc_markl 12/5/2012 | 4:15:49 PM
    re: 100G Watch: Chips Get Merger Fever


    Are there not currently sourcing problems (as in only one supplier) as well with the LR-10?

    To the second point, I think that is why we are seeing so much vertical integration at 100G.


    Camil_mat 12/5/2012 | 4:15:41 PM
    re: 100G Watch: Chips Get Merger Fever

    You may be right but I heard JDSU is now making the same module. Not sure if this is true but there was an announcement made a couple of weeks ago that hinted at perhaps one other module vendor picking LR10. 


    AutoDog 12/5/2012 | 4:15:24 PM
    re: 100G Watch: Chips Get Merger Fever

    The "LR10" debate is interesting and eveb amusing. First off, "LR10" is not standardized... There is no IEEE "100G-BASE-LR10" spec.  Essentially it is a proprietary scheme from a single vendor, Santur, that has backing from Google since they like the price point.


    As for JDSU, the word on the street is that they're just re-branding the same innards that Santur has cooked up. Not a true 2nd-source. May be hard to get truthful conformation on this, of course.


    To play devil's advocate, if you have a single-sourced technology with no intergface standardization, how does this help the industry? Sure, Google may buy it for their internal use, but really seems like a short-term BandAid at best or an unfortuante detour & distraction for the industry at worst.


    25G-based I/O & optics will win out in the long-term but it's not going to be pretty in the mean-time.



    spc_markl 12/5/2012 | 4:15:23 PM
    re: 100G Watch: Chips Get Merger Fever


    I could be wrong, but I thought that Sumitomo was in the LR10 gearbox chip business.


    AutoDog 12/5/2012 | 4:15:23 PM
    re: 100G Watch: Chips Get Merger Fever



    I don't think Sumitomo is in the game. It's all about Santur's laser array (derived from their tunable laser work).  They have been publicly pushing their proprietary 10-lamda WDM approach for several years now:


    Google has been rabidly evangelizing it for some time and has recently coined the 10x10 MSA to further the cause.




    spc_markl 12/5/2012 | 4:15:23 PM
    re: 100G Watch: Chips Get Merger Fever


    Are you sure it is not Sumitomo providing the LR10?


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