EBN's Daily News Digest. PMC acquisition could signal ATM revival
[Excellent trend for ASND]
Excerpt: ""ATM is being deployed in end-to-end
networks," Ramsden said. "We also see ATM
extending into the exchange networks."
Among these exchange networks could be DSL.
"DSL may create new applications for ATM,"
Pleasant said. "A lot of DSL equipment vendors
are looking to transport the data traffic over an
ATM network.""
by: Mark LaPedus
(4:50 p.m. EDT, 4/28/98)
pubs.cmpnet.com
Silicon Valley
The sluggish ATM equipment business could get
a boost this year as several chip makers move to
dramatically increase their share of the market.
Creating what could be one of the world's
largest ATM chip suppliers, PMC-Sierra Inc.
late last month announced plans to acquire
Integrated Telecom Technology Inc. (IgT) for
about $55 million in cash and stock.
PMC-Sierra, Burnaby, British Columbia, is
already a major supplier of physical-layer-based
ATM chips, as well as 1-Gbit Ethernet,
T1/E1/J1, Sonet, and other high-end
communication ICs. IgT, Gaithersburg, Md., is a
major player in the ATM-based
segmentation-and-reassembly and switch-IC
segments.
"PMC was already one of the top three players
in the ATM chip market," said Shannon
Pleasant, an industry analyst at In-Stat Inc.,
Scottsdale, Ariz. "The acquisition of IgT will
strengthen [PMC's] position."
In fact, PMC-Sierra was among the world's top
five ATM chip makers last year, according to a
list of top semiconductor suppliers published by
EBN last March. Other top ATM chip suppliers
on the list included Cypress Semiconductor
Corp., Integrated Device Technology Inc., LSI
Logic Corp., and TranSwitch Corp. Emerging
ATM chip makers not on the list include Hitachi
Ltd., Maker Communications Inc., and NEC
Corp.
It's unclear which chip supplier is the overall
market-share leader in ATM. Most chip
vendors do not break out their total ATM sales,
and the market itself is fragmented.
The total ATM chip market is expected to
increase from $143 million in 1997 to $199.6
million in 1998, according to In-Stat, and
appears ready for a revival after some setbacks.
Billed as the next desktop-based LAN standard
a few years ago, ATM hit a wall in that segment
following the emergence and acceptance of Fast
Ethernet and now 1-Gbit Ethernet
ATM has since migrated from LAN to WAN,
but the technology is rapidly moving in new
directions, said Ian Ramsden, director of
strategic marketing at ATM chip specialist
TranSwitch, Shelton, Conn.
"ATM is being deployed in end-to-end
networks," Ramsden said. "We also see ATM
extending into the exchange networks."
Among these exchange networks could be DSL.
"DSL may create new applications for ATM,"
Pleasant said. "A lot of DSL equipment vendors
are looking to transport the data traffic over an
ATM network."
The emerging applications for ATM could cause
chip makers to consolidate or forge alliances in
order to offer a broader range of components,
and PMC-Sierra's move to acquire IgT may be
the first such move.
"This acquisition will allow us to offer our
customers a more complete solution in the area
of ATM networking applications and will better
position our company to further integrate ATM
systems into fewer chips," Bob Bailey, president
and chief executive of PMC-Sierra, said when
the deal was announced.
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