<<"We believe that, in the months to come, ALCATEL’s semiconductor division will begin to leave the ADSL market. This will leave ALCATEL’s equipment unit, which manufactures Digital Subscriber Line Access Multiplexers and Digital Loop Carriers, looking for new suppliers of ADSL chipsets.
We believe that Aware’s chip customers, which include Analog Devices Inc. and eight other chip makers, could be in a strong position to win some, if not all, of ALCATEL’s system business. Combined with Aware’s close relationship to major chip suppliers such as Intel Corp., we think Aware and its partners could see their share of the ADSL software market climb above 50%, and possibly much higher, in the next 12 to 24 months." >>
(From the Stephens research bulletin concerning AWRE: siliconinvestor.com
Hi Perry,
This is a very interesting find and points to something I was seeing but didn't understand. WSTL went into partnership with ALA a couple of years ago and the strength of WSTL's deployment was partly based on their compatibility with Alcatel who had cornered 50% of the market in DSL for CO at ILECs. Now, however, WSTL latest report shows that the chips for their modems no longer come from ALA but from VRTA. VRTA makes ALA compatible chips and is also using TXN DSPs in the next generation DSL gateways. Sounds like a winning combination to me.
I had been wondering why WSTL had turned to VRTA, and why VRTA is doing so well. Are they the heir if ALA leaves
the ADSL fabrication? Clearly with INTC and AMD also entering the DSL marketplace the competition becomes very heavy. ALA may now be going where it can find higher margins having established the DSL architecture.
I would be interested in any interpretations others might have. Like you Perry, I agree that understanding this development is important to understanding the DSL marketplace.
All the best,
Michael |
