BOPS, a 4-year-old start-up, has developed a chip design that will allow telecommunications service providers to handle more phone calls over the Net at a cheaper price, said BOPS Chief Executive Carl Schlachte. In the future, BOPS' technology will be able to speed the delivery of Web information to handheld devices, such as cell phones and personal digital assistants, he said.
BOPS is attempting to break into the $7 billion-a-year market for digital signal processors (DSPs), which are used in cell phones and other high-tech equipment. DSPs refine digital audio and video data so that data can be efficiently sent across computerized networks.
Texas Instruments leads the DSP market with nearly 50 percent market share. Other big players include Analog Devices, Lucent Technologies and Motorola, said Gartner analyst Tom Starnes.
BOPS will license its high-capacity processor design to other chipmakers, which will then build the processors themselves. So far, Mitsubishi and SiByte have licensed the technology, Schlachte said.
With Schlachte, a former vice president of ARM, at the helm, BOPS' business model closely resembles ARM's strategy. ARM designs chips but doesn't sell them. Instead, ARM licenses its chip design to semiconductor makers that incorporate it into chips for cell phones and information appliances. Several companies, such as Intel and Cirrus Logic, license ARM's designs.
Schlachte said BOPS will concentrate on the network equipment market first, licensing the technology to companies that make chips for Internet telephony equipment created by the likes of Cisco Systems and others. Schlachte said the chips, built into the Internet telephony equipment, will allow telecommunications service providers to handle more voice calls over the Internet at a cheaper price than current technology allows.
In the future, Schlachte expects BOPS' technology to be used for cell phones, Web-surfing tablets and other handheld devices for bandwidth-intensive uses, such as videoconferencing.
Gartner's Starnes said he believes BOPS has one of the highest-performing DSPs in the market today. Whether the company can compete in the DSP market with a licensing model remains to be seen, he said. The other major players--TI, Motorola, Lucent and Analog Devices--all build their own chips.
"Will the market go for this licensing approach? That's kind of a toss-up," Starnes said. "But they have a lot of things going for them: a high-performance chip design and an executive who's worked at ARM and was successful in getting ARM where it is."