Scintera Piques KP's Telecom Interest

Scintera Networks Inc.'s recent funding signals some good news for the 10-Gig Ethernet marketplace, particularly where carrier applications are concerned (see Scintera Raises $9.5M Second Round).

Scintera, which makes a dispersion compensation chip for overcoming signaling problems in legacy fiber networks, just closed a second round of $9.5 million, bringing its total funding to date to $17.7 million.

Notably, the round was led by venture capital heavyweight Kleiner Perkins Caufield & Byers, a company that during the bubble heyday splashed enough cash into telecom to sink a submarine. But Kleiner Perkins has gone verrrry quiet during the last two years, maintaining its portfolio but not investing in any new telecom startups.

The firm dipped its toe back into the frosty telecom waters last year with just two new investments, the first in Kodiak Networks, which makes push-to-talk applications for the telecom infrastructure market, and the second in Scintera.

"Signal processing is a hard problem to solve, and at 10-Gig in CMOS [complementary metal-oxide semiconductor], it’s extremely hard," says Matt Murphy, principal, Kleiner Perkins. "In Scintera, we found an experienced team that knows how to do it with shipping product and a lot of interested customers."

Scintera's chip comes in two flavors: the 3142, aimed at the enterprise market, and the 5028, targeted at the carrier space. The difference in the two chips relates to the different dispersion problems. "At 300 meters in the enterprise the dispersion environment is different from 100 kilometers in a carrier network," says Steve Kubes, VP of sales and marketing, Scintera.

He adds that the first application for the chip is likely to be in the enterprise, where growth in gigabit connectivity is building a huge latent demand for 10-Gig Ethernet in the backbone.

In general terms, dispersion compensation enables enterprises and carriers to stretch legacy fiber networks over greater distances than they were intended to go by pushing the signal further and cleaning up the dispersion of the signal at the other end. Applied Micro Circuits Corp (Nasdaq: AMCC) and Big Bear Networks compete in this market (see No Go for Yafo? ).

Scintera is aiming to sell its chips to the major transceiver and transponder suppliers, such as Agilent Technologies Inc. (NYSE: A), Infineon Technologies AG (NYSE/Frankfurt: IFX), Intel Corp. (Nasdaq: INTC), and JDS Uniphase Corp. (Nasdaq: JDSU; Toronto: JDU), as well as companies making line card implementations, such as Nortel Networks Corp. (NYSE/Toronto: NT) and Siemens AG (NYSE: SI; Frankfurt: SIE). It has announced no design wins yet, but it claims to be close to some big ones.

At the helm of this company is a team of seasoned executives, including Abhijit Phanse, who spent about a decade at National Semiconductor Corp. (NYSE: NSM) leading the development of communication ICs for high-speed LAN and optical networking applications. Dr. Abhijit Shanbhag, co-founder, VP, and chief systems architect, was recently with Qualcomm Inc. (Nasdaq: QCOM) and LM Ericsson (Nasdaq: ERICY). And Steve Kubes was most recently at Altima Communications (acquired by Broadcom Corp. [Nasdaq: BRCM]), and was director of strategic marketing for the LAN division of Level One (acquired by Intel).

Scintera has filed more than 15 patents and counts August Capital and Sevin Rosen Funds among its previous investors.

— Jo Maitland, Senior Editor, Light Reading

For related information on this subject, see:

10-GigE Transponders: Update

PHY Chips, The Key to Running Ethernet at 10 Gbit/s