Your concerns with Broadcom's short product lifecycle are valid, but may be overblown IMO. Sheer unit growth and mass will allow for them to consistently grow revenues.
The low-margin days are all but over as well. Single Ethernet transceivers are passe. In the LAN Broadcom integrates customer-specific IP into each LAN device, which are more complex and flexible now. In CM/STB markets, no one can match Broadcom's array of IP and technological expertise. Functionality for VPNs, online gaming, 3D graphics, VoIP (cable), home networking, fax support, HDTV/SDTV, etc are all centralized in Broadcom. TI, STM and Conexant cannot offer such a complete solution for residential cable broadband gateways (DSL too soon-VDSL now, then ADSL). Broadcom's margins will remain fairly high (58% GM, 27% OM), and will onmly decrease by their own doing. They drive these markets and are virtually impervious to outside pressures. |
