Oh Rockwell, where art thou? And, will Ascend ever see the light?
Lucent Technologies Inc. plans to unveil today a chip for digital
communications that's as much as 30% cheaper and requires one-fifth the
power and memory of similar chips made by market leader Texas
Instruments Inc., people familiar with Lucent's plans said.
The digital signal processor, or DSP chip, will be the first chip
based on Lucent's next-generation DSP16000 architecture. A spokeswoman
for Lucent, based in Murray Hill, N.J., confirmed the announcement and
said the chip would "set a new standard for performance and cost."
DSPs are designed to perform a small number of functions effectively
and are found in compact-disk players, wireless phones, digital cameras
and other audiovisual devices. Lucent's new chip will be aimed at use in
cellular phones, their base stations, and multichannel modem banks used
by Internet service providers.
Analysts said the new chip is an important advance for Lucent, but
may not cost Dallas-based Texas Instruments significant market share.
"TI beat them to the punch earlier this year with the C6X," said Tom
Starnes, analyst at Dataquest, San Jose, Calif., referring to Texas
Instrument's DSP chip that can process 1.6 billion instructions a
second. The two companies' DSP chips "are probably on par with each
other," Mr. Starnes said, because each have advantages in several areas.
For instance, while Lucent's chip uses less power, at 1.1 billion
instructions a second, it's slower than Texas Instruments' chip, he
added.
"They'll both slug it out in the marketplace along with the others,"
said Fred Zieber, president of Pathfinder Research. "I think it's a
modest threat" to TI's market share, he said, adding: "Any good new chip
is a threat to TI."
Lucent is expected to unveil the chip under a new architecture that
could eventually produce chips with speeds faster than Texas
Instruments' C6X, which was introduced in February. For its part, Texas
Instruments offers "very, very competitive products" for wireless
applications, said David Pahl, Texas Instruments' DSP product-marketing
manager. In addition, "we'll have multiple products that will be
announced later that will have different power and different memory
configurations."
The DSP market is about $3 billion a year and is expected to rise
rapidly to about $6.5 billion by the year 2000, said Radu Andrei at
Semico Research Corp. Mr. Starnes estimates that just under half of the
DSP market is focused on these so-called communications chips.
People familiar with Lucent's new chip say that it could help reduce
the size of wireless phone-base stations to the size of a smoke alarm
from the size of a file cabinet. That should help reduce the costs for
cellular-service providers and could translate into lower prices for
consumers, these people say.
Mr. Pahl said that Texas Instruments' chips have much broader uses
than do Lucent's. "I think that when we see Lucent in the marketplace,
they continue to be focused on a very small segment of the market," he
added.
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