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Electronics News Digest

28 August 2002 News Electronic News Digest

Southern Africa

Internet Solutions (IS), has become one of the two largest independent suppliers of fibre-optic bandwidth after signing a contract worth R150m. The ISP said that this means that about 30% of its infrastructure is fibre-based as opposed to the previous 3%. Says Stuart Hardy, general manager of the access division at IS: "Fibre offers a far more stable platform than satellite links and transfers data at up to four times the speed. We expect at least 20% of our client base will move over to fibre in the next six months." Internet Solutions plans to double its fibre capacity within the next quarter at which point it will be the largest supplier of fibre in the country.

QuantumTag ID and Trolley Scan have signed licensing agreements that will allow QuantumTag ID to produce RFID systems and components using Trolley Scan's patented RFID technology. QuantumTag will shortly begin to produce UHF radio frequency identification (RFID) systems comprising of transponders and readers. QuantumTag ID was formed to specifically address the market need for low-cost high-performance RFID systems that are needed in high volume. Based in Johannesburg with strong marketing connections in the UK, QuantumTag says it will be producing the large volumes of transponders needed by using the services of specialist design and assembly sub-contractors, allowing them to quickly scale up production to meet market needs.

Grintek Telecom has been selected to provide Radiospoor, a service provider of Vodacom, with Hypercom Interactive Consumer Environment (ICE) terminals, which allow Radiospoor to issue pre-paid airtime pin numbers at retail outlets instead of using traditional 'scratch cards'. The contract is worth R3,4m for the initial provision of 720 terminals. A value-added benefit of the Hypercom ICE terminals is their multifunctionality. The terminals may also be used for banking transactions, using credit or debit cards and, because they also include a Web browser, may also be used to book and pay for tickets over the Internet according to the company.

E-business Infrastructure Solutions (EBIS) has won a R1,4m tender to install one of South Africa's most advanced computer cabling networks at Durban's Suncoast Casino & Entertainment World. The tender was won in conjunction with Dimension Data Advanced Infrastructure, EBIS's certified installer. The installation will use 900 m of fibre cabling and 30 000 m of Category 6 cabling.

MTN and Dimension Data have officially opened a jointly-funded, R3,1m, 10-classroom secondary school for learners in the remote Mount Frere district of the Eastern Cape. MTN's and Dimension Data's involvement in the project follows former President Mandela's call to enlist the aid of corporate South Africa to provide decent educational facilities in disadvantaged areas. The Nzululwazi Senior Secondary School's 290 learners and 10 educators are now accommodated in fully equipped classrooms. The school also boasts a library, IT media centre, science laboratory, a hall and admin block.

The World Summit on Sustainable Development (WSSD) will benefit from an innovative pilot project that aims to establish the basis for a regulatory and trading framework for 'green' electricity. The project, led by AGAMA Energy, will co-ordinate the supply of electricity (certified 'green' by the NER of South Africa) to two of the main venues at the Summit: the Ubuntu Village and NASREC Expo centre. This green electricity - derived from renewable resources and generated in a sustainable manner - is supplied by new and existing power generators in the southern African region and overseas.

Siemens Southern Africa has been voted the company with the best social responsibility programme in South Africa. Siemens received the City Power Presidential Award for Service Excellence and Social Responsibility in recognition of the company's commitment to the development and upliftment of southern Africa. Siemens said it won the award on the basis of its, "striving for the social and economic development of the Region" and its ability to act as a "catalyst for empowerment". Siemens was nominated alongside 3M, Aberdare, Deloitte and Touche and KPMG.

Overseas

Business

National Semiconductor has lowered its forecast for Q1 of fiscal 2003, ending 25 August, and now expects it to be around the same level as in the recently-completed fourth quarter, with reported revenues of $419,5m. On 6 June, the company had guided that sales would grow sequentially by 6-8% during the quarter. However, it said that overall order rates, including turns orders, were lower than expected in June, especially for products for PC and related peripherals, such as CRTs and displays. Gross margin percentage is also projected to be comparable to fourth quarter. Overall, National Semiconductor said it expects to remain profitable.

LeCroy, a leading supplier of high-performance digital oscilloscopes, announced financial results for Q4, fiscal 2002. Fourth quarter sales were $28,7m compared with $39,5m and full year sales were $111,5m compared with $141,4m in the 2001 financial year. As a result LeCroy recorded a net loss of $2,2m in the fourth quarter and a net loss for the whole year of $6,2m. LeCroy said that nonrecurring items impacted the fourth quarter including a previously-announced $4,0m investment to gain access to IBM's 0,18 µm silicon germanium process technology, which LeCroy intends to use to develop future high-speed oscilloscopes, and $0,4m of severance costs associated with continuing efforts to reduce ongoing operating expenses. As a result of its cost reduction actions, LeCroy said it expects to be slightly profitable in the first half, and is aiming at operating margin targets of approximately 6% in the second half of fiscal 2003.

MathStar, a Minneapolis-based provider of high speed, high performance communications chips, has announced that it successfully raised $15,3m in additional funding. A fabless semiconductor company, MathStar is addressing new problems faced by the semiconductor industry. As chip geometries shrink and design and mask-set costs rise, it believes that customers will want an off-the-shelf, high performance, reconfigurable device. MathStar's technology targets the communications market with a reconfigurable chip that it claims can provide the time to market advantages of FPGA chips with the cost and performance advantages of ASIC (custom) chips.

Companies

Royal Philips Electronics and Robert Bosch (Bosch), have announced a preliminary agreement regarding the sale of Philips' Communication, Security & Imaging (CSI) business unit. Completion of the transaction is expected to take place later this year. Financial details were not disclosed. Philips CSI designs, manufactures, sells and supports a broad range of professional communication and security products and systems including CCTV, congress and public address systems. The acquisition of Philips CSI, which will be placed within Bosch Sicherheitssysteme GmbH, will strengthens Bosch's market position in systems and components for video surveillance, where it already employs 4200 people, give it access to international markets for security systems.

Memscap, a provider of innovative micro-electro-mechanical systems (MEMS)-based solutions, has entered an agreement to acquire the Cronos MEMS business unit from JDS Uniphase. As its exclusive supplier of MEMS-based products, Memscap will provide ongoing access to MEMS technology as well as a secure source for the continued availability of MEMS optical products. As part of the agreement, JDS Uniphase has provided Memscap with initial purchase commitments for products and services.

Peregrine Semiconductor, a US supplier of optical networking and wireless communications chips, is creating a space and defence business unit. Many of the company's customers include satellite and military manufacturers.

Linux industry leaders Caldera, Conectiva, SuSE Linux, and Turbolinux, have announced that UnitedLinux will be available as a closed beta product by the end of August to partners of the four founding companies. It is expected to be publicly available in open beta by the end of Q3 2002. The UnitedLinux product is the result of an industry initiative to streamline Linux development and certification around a global, uniform distribution of Linux designed for the business user.

Industry

Sales in the worldwide semiconductor industry for the month of June were essentially flat according to figures from the Semiconductor Industry Association (SIA). Sales hit $11,35 bn, down 0,2% from $11,37 bn in the previous month, and down 0,2% from $11,37 bn in the previous month. George Scalise, SIA president, said: "While computer and computer-related sector demand is lagging, wireless and consumer sectors continue to strengthen. These two leading sectors are stimulating strong sales in flash, digital signal processors, application specific products, discretes and analog, all of which increased by double digits rates in the June quarter." For SIA's mid-year market forecast: sales in 2002 are expected to result in around 3% growth from 2001; growth rate is expected to accelerate to 23,2% in 2003 and 20,9% in 2004.

At a company-sponsored Webinar event attended by 22 industry insiders recently, analyst group iSuppli said semiconductor business in March began a recovery that is expected to become the most dramatic upturn in the chip industry's history. According to iSuppli, data published by World Semiconductor Trade Statistics (WSTS) indicates that March marked the nadir of the steepest and deepest drop in the history of the chip business. Based on a 12/12 average, which compares revenue in each month to the same month one year earlier, semiconductor sales fell by 36,8% in March. However, iSuppli predicts the present recovery will be the strongest ever. The WSTS data from March through June already shows a stronger recovery than seen in previous cycles, and iSuppli predicts that this strength will be sustained through the end of 2002. However, even with this strength, an analysis of current trends indicates the semiconductor market will grow between +2% and -2% for the third and fourth quarters of 2002.

European semiconductor sales in June 2002 amounted to $2,145 bn according to statistics from the European Component Manufacturers Association (EECA) and WSTS. This corresponds to a 14,3% decrease compared to the same month last year. Year-to-date, semiconductor sales decreased by 23,9% versus the same period last year. Monthly sequential growth (from May) showed a slip of 4,1%. Worldwide, semiconductor sales in June were $11,351 bn, a 1,6% decline versus the same period a year ago. On a monthly sequential basis, this corresponds to a decline of 0,2% and on a year-to-date basis to a decline of 14,9%.

While IT spending worldwide remained flat in 2001 (and declined in the US), e-business spending grew by more than 20%. This is according to IDC, which says that this growth will continue as companies make e-business one of their top investment priorities. "The dot-com crash did not kill anything except hundreds of ill-conceived companies," said John Gantz, IDC chief research officer. "In fact, it actually helped usher in the real 'new economy', the one where businesses, schools, and government agencies from around the world are steadily integrating Internet technologies into their normal business operations." According to IDC's eWorld 2002 survey of more than 2000 companies in 10 countries, respondents said they allocate 12% of their IT budgets to Web-based initiatives - almost double what they allocated before the dot-com crash.

IBM intends to cut more than 15 600 jobs - above the 10000 that analysts had previously expected - in its computer-services and microelectronics businesses. IBM said it will cut 14 213 jobs, mostly in its services business, and 1400 jobs from its microelectronics unit. The company will be adding about 30 000 workers with its planned acquisition of consulting firm PriceWaterhouseCoopers for $3,5 bn in cash and stock.

Bluetooth has survived its baptism by fire and appears poised to fulfil much of its considerable potential, evidenced by steady market growth in 2002. Allied Business Intelligence (ABI) projects Bluetooth chipset shipments to increase to 33,8 million in 2002, up from 11,2 million in 2001. In the longer run the Bluetooth semiconductor market is forecast to grow to just over 1,1 billion chipsets by 2007, with associated revenues of $2,54 bn. ABI says that the original hype in the Bluetooth space has largely been replaced by a far more pragmatic perspective, with an understanding of the technology's limitations. The Bluetooth 1.1 specification is fairly stable, interoperability issues are far fewer, and aggressively priced chipsets are available from several vendors.

A lot of 'buzz' has been created by the FCC's recent decision to force consumer electronics manufacturers to include built-in digital TV tuners in new TV sets for the US market, beginning in 2004, according to a recent InStat Alert. On 8 August, the FCC made a decision to force consumer electronics manufacturers to provide ATSC-compliant tuners in new TV sets, to increase the proliferation of digital terrestrial broadcasts in the US. In addition, the FCC opened the door for the 'broadcast flag' copy protection plan, which would need to be built into new DTV receivers. FCC chairman Michael Powell has provided a four-step plan outlining the FCC's policies for upcoming radio frequency spectrum allocations: more efficient use of radio frequency spectrum space; shift from a 'command and control' model of regulation to market based mechanisms; reconciling critical governmental uses of spectrum with commercial uses, and; fostering innovation (see www.fcc.gov).

While the overall number of PC shipments suffered a slight decline in the second quarter of 2002, the mobile PC segment managed positive growth, according to preliminary results from Dataquest. The number of worldwide mobile PC shipments totalled 6,9 million units in the second quarter of 2002, a 6,1% increase from the second quarter of 2001. By comparison, worldwide PC shipments declined 1% in the second quarter of 2002 compared to the second quarter of last year.

The IEEE-1394 high-speed digital interface is continuing to make gains in consumer electronics markets, says In-Stat. The research firm reports that, although PC-based products with 1394 have historically comprised the majority of shipments, in 2001 consumer products overtook PC-based products. Solid growth will continue, with total 1394 devices growing by 21% in 2002, as the interface penetrates more models in the retail PC, digital camcorder, and other consumer electronics markets, and emerges into new applications such as automotive. However, it also results in significant industry conflicts. Major market inhibitors are interface alternatives, including USB 2.0, a lack of current applications beyond digital video editing, and the current tech slump. The consumer electronics (CE) market faces the most significant market barriers, the primary of which is copy protection of copyrighted video. As 1394 will ultimately carry digital video, content protection is a critical issue says In-Stat.

The Chinese government has approved Sony Ericsson Mobile Communications' plan to start operations in China.

Ampro Computers has had its first RISC version in its innovative EnCore module form factor selected as a subsystem category winner of the Electron d'Or 2002 award. The exclusive awards program is sponsored by France's Electronique magazine, and honours outstanding engineering products in the electronics industry. The EnCore M2 Module is the first MIPS32-based product in Ampro's new EnCore product family.

Technology

A new scientific computing system to be installed next year at the Central Institute for Applied Mathematics in Juelich, Germany, will become the largest in Europe. The IBM 5,8 teraflop system will consist of 37 IBM eServerp690 systems and will be used by scientists to model problems in physics, chemistry, biology and environmental sciences. The IBM contract is worth approximately $10m. The new cluster is reported to rank in third place behind ASCI White, at Lawrence Livermore National Laboratory (7,22 teraflops`) and the leader, NEC's 35,86 teraflops Earth Simulator in Kanazawa, Japan.

Intel has demonstrated the world's most advanced 90 nm logic process. This new process is scheduled for production in 2003 and will be used to manufacture microprocessors and other Intel products. Intel said the process integrates a number of industry-best technologies: it implements the world's smallest CMOS transistors in production - 50 nm gate length (for higher performance and lower power); implements thinnest gate oxide ever used in production - 1,2 nm; and is the first to use performance-enhancing strained silicon in production - atoms are spaced out more than regular silicon which allows current to flow more freely.

Microchip Technology and Future Electronics have partnered to create a 'Wireless Sensor Solution' reference design kit that provides novice and experienced radio frequency (RF) designers with an easy-to-adopt RF solution. The reference design kit is a self-contained 'working prototype' that highlights Microchip's rfPIC UHF transmitter and the PIC16C925 microcontroller with an LCD driver.





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