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Technology Stocks : Texas Instruments - Good buy now or should we wait?
TXN 159.33-1.8%Nov 14 9:30 AM EST

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To: pat mudge who wrote (3987)8/19/1998
From: Danny Hayden  Read Replies (1) of 6180
 
And here is a little more

Posted: 9:00 p.m., EDT, 8/18/98

TI takes proprietary road with standard
linear parts

By Stephan Ohr

DALLAS - Texas Instruments Inc. is bringing out a number of proprietary
analog parts in the hope of setting the market standard. As the market leader
in custom analog circuits, TI wants to lead in standardized building blocks as
well. The company has already announced thrusts in data converters, and is
forging ahead in audio amplifiers and in-line drivers for low-voltage
differential signaling (LVDS).

In its "catalog components" strategy, TI hopes to duplicate the success of
companies like Linear Technology Corp. (Milpitas, Calif.) and Maxim
Integrated Products (Sunnyvale, Calif.). These companies made a reputation
- and profits - offering their own premium part numbers for application
slots otherwise populated with commodity part types. "We want designers to
use our part numbers in emerging applications like ADSL and digital
consumer," said Steve Goacher, analog product development director. "We
have the engineering talent to do it." The company hopes to introduce 80 new
analog products this year, and 150 in 1999.

TI already has major positions in all four linear markets, according to market
reseach firm Dataquest Inc. It ranks third behind National Semiconductor
Corp. (Santa Clara, Calif.) and Analog Devices Inc. (Norwood, Mass.) in the
$1.8 billion IC amplifier market; ranks second behind ADI in the $1.5 billion
data-converter market; and third behind National and LTC in the $2.1 billion
voltage regulator market. However, TI leads National and Maxim in the $1.3
billion interface IC market. Much of this has been in commodity part types,
which TI readily supports with design kits and large-type, easy-to-use
application guides (known in the analog industry as the TI "Yellow Books").

To cover some new ground, TI hopes to make a splash with the introduction
of its Class D audio amplifiers. Based on switching power-supply techniques,
Class D has long been touted as the means of extracting audio power
efficiency out of audio IC amplifiers. Class D amplifiers essentially convert
an analog input to a pulse-width modulated waveform, which is amplified by
MOSFET switches and then converted back to analog by out-board filters. In
contrast to Class A-B (push-pull linear) amplifiers, which absorb bias current
regardless of the audio-signal amplitude, the tax on the power supply of Class
D amplifiers varies with the duty-cycle of the audio pulses. Thus, efficiency
is three times as high with a class D, and power dissipation (which can
create heat and tax battery life in portables) is about one-fourth that of Class
A-B.

TI's TPA005D02 is an integrated Class D audio amplifier that runs from a
single 5-V supply. It provides up to 2 W stereo with a bridge-tied 4-ohm load
and 0.5 percent THD+N (total harmonic distortion plus noise). It is unique in
that it offers the only full-differential input for each stereo channel. It
includes shutdown and mute operations to conserve battery life, and H-bridge
MOSFETs (speaker drivers) on chip. In addition to portable computers, there
has been interest for this part in metal-detector applications where changes in
audible head phone tones indicate the presence of a desired object.

TI's thrusts in standard linear components are part of what it calls "DSPS" -
DSP solutions. Forward Concepts (Tempe, Ariz.) calls TI the world's largest
DSP supplier, with almost 50 percent of 1997's $3.25 billion market. But for
every DSP in use, a bank of sensor-signal-conditioning elements and A/D
components is on the front, and D/A converters and power drivers are on the
back. TI assumes that $1.70 in analog components is needed to support
every dollar of DSPs.

With highly tuned manufacturing processes, TI has been an outstanding
second source for standard logic and linear parts, which the company calls
"SLL." But too many of these part types, said Goacher, are commodity-part
types with multiple sources. "The three key customer concerns in this area
are 'cost, cost and cost'," he said.

Applications-support costs are also likely to increase. Customers for TI's
vaunted Yellow Books - now CD-ROMs - are increasingly digital
designers who know little about analog. And these factors have paved the
way for low margins. (Asked to comment on the accusation that TI could
make standard linear parts "better and cheaper" than the competition, Tom
Engibous, TI president, said, "I like the first part of that.")

Thus, the new thrusts in differentiated products can be seen as an effort to
establish leadership and elevate margins in an otherwise highly competitive
market. High-speed products - op amps and data converters - make up
one area where the company hopes to insert proprietary part types. "You
can't second source a 400-MHz op amp," said Goacher. To support this, TI is
cultivating complementary bipolar and BiCMOS manufacturing processes.

LVDS is another area where TI hopes to lead the charge. Low-voltage
differential signaling uses the voltage on V+ and V- signal pins to transmit
logic values: A +60 mV signal is a logic one; a -60 mV signal is a logic zero.
That allows very high data rates - up to 655 Mbits/s with a voltage swing of
350 mV.

Flat-panel display drivers are a key application for TI's SN65LVDS050/51
dual-channel drivers/receivers, said Goacher. These are BiCMOS parts with
up to 8 kV of electrostatic discharge protection. Competitors' CMOS parts,
Goacher said, do not offer good ESD protection or easily support the
row-and-column matrixes required for flat panels.

National Semiconductor is currently TI's only competitor for LVDS, but since
the technology is relatively new, the companies are effectively partners in
proselytizing it. TI, obviously, hopes that its part numbers will be the ones that
other analog supplies will try to replicate.

Asked for TI's chances of success, Steve Goacher pointed to Linear
Technology's break from National Semiconductor over 15 years ago. But
there is another data point: Some might recall that the part numbers for
multisourced, industry-standard 7400 series logic were TI's.

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