No surprise....TI supplied the chips for the 6650.
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Investor's Business Daily
'Mobile Internet' Gives Legs To TI
Wednesday October 2, 10:53 am ET
BY JAMES DETAR
It's always risky to predict the next big thing in technology. But William Aylesworth, a senior vice president at Texas Instruments Inc. , has no qualms.
That next biggie, he's convinced, is the "mobile Internet" - and he says it will drive chip sales for months and years.
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Texas Instruments plans to be at the heart of the mobile Net. And it's partly going about getting there in an unusual way for a chip company. It's buying software companies.
"We're seeing the advent of the true mobile Internet," Aylesworth said. "People will have more and more uses for handheld wireless devices, be it a cell phone, a PDA or something else."
People, he says, crave the ability to access the Net from anywhere at any time - without wires.
TI saw early fruits of its efforts just last week. On Sept. 25, Nokia Corp. unveiled what analysts say is the first third-generation cell phone - it runs on both of the main mobile standards, GSM and WCDMA. The phones use TI chips.
TI is the leading seller of a type of chip called a digital signal processor. DSPs are great at high-speed math functions, which are needed with digital devices like cell phones.
The company's Omap line of high-speed DSPs are used in game machines, digital video disc players and high-definition TVs.
Like most chipmakers, TI had a miserable 2001. Sales fell 30% to $8.2 billion. But its sales have risen sequentially for the first two quarters of 2002.
Cell Phone Chip Leader
Despite the chip slump, TI's prospects are good because of the outlook for new cell phones such as Nokia's, says analyst Will Strauss, president of Forward Concepts Co.
"They have an excellent position with a 50% share of the cell phone chip market," Strauss said.
TI's main rivals in the cell phone chip market are Motorola Inc. and Qualcomm Inc.
Wireless is the bright spot for TI, agrees Thomas Weisel Partners analyst Eric Gomberg in New York. But other markets could hold TI back.
"Outside of the wireless segment, there are very few additional bright spots in the macropicture," Gomberg said.
Aylesworth, though, says his company will meet third-quarter expectations. "As we meet our expectations for the third quarter, that will give us revenue levels literally up 20% from a year ago," he said. "So we are well off the bottom of the trough of the cycle."
To accelerate its push into the mobile Internet, Texas Instruments has been buying software companies, most recently Condat AG. TI paid $85 million in cash for the German company on June 20. Condat employed 380 software engineers.
Software Makes A Difference
With the purchase, TI added wireless software research centers in Berlin, Germany and Edinburgh, Scotland. It now has eight wireless R&D centers worldwide.
Aylesworth says TI's software will differentiate its chips from rivals'.
Condat, he says, gives TI "the fundamental operating software for a cell phone to work with the chips. It's necessary for every digital cell phone to have this."
He says TI is looking to buy more key software companies like Alantro Communications Inc. TI bought Alantro for $300 million in stock in September 2000. This enabled TI to give its chips 802.11 wireless networking software capabilities.
As new software comes to market, people will find more ways to use mobile Internet devices, Aylesworth says. "Millions and millions of people around the world don't have wireless Net access today, but they'll benefit from it when they do," he said.
The industry, though, must overcome some obstacles before the mobile Net takes off, says Curtis Waters, business manager of TI's cellular media group.
"One issue is how to combine into one device what today are stand-alone functions," Waters said.
But the biggest obstacle he sees isn't technical. "Politics will have an effect on channels and content," he said. "Some of these are very contentious issues." |
