Infineon, Agere, Motorola form DSP venture

Infineon Technologies AG, Agere Systems Inc. and Motorola Inc. announced the establishment of a new venture, StarCore LLC, to develop and license DSP (digital signal processor) technologies.

StarCore is expected to begin operations in the second half of 2002, subject to regulatory approvals and other customary closing conditions. The company will be headquartered in Austin, Tex., with a subsidiary office in Tel Aviv, Israel, the companies said in a statement.

Infineon, Agere and Motorola will have equal stakes in StarCore, which will initially employ 100 people, said Thomas Lantzsch, chief executive officer of StarCore.

The joint venture will license DSP core technologies to semiconductor manufacturers and communication equipment vendors worldwide. The three biggest customers of the startup initially will be the three shareholders, Infineon, Agere and Motorola, representing about 30 per cent of the market for DSP products, according to Ulrich Schumacher, president and chief executive officer of Infineon.

The venture’s open licensing strategy, Lantzsch said, will allow companies to “alleviate costly development expenses and obtain proven intellectual property.” Through open licensing, StarCore will help create an industry standard, he said.

The companies declined to provide revenue or profit forecasts.

StarCore grew out of a joint venture launched in 1998 between Agere and Motorola in Atlanta. Infineon will fold its own DSP technology team in Tel Aviv into the new company.

DSP technology plays a critical role in wireless communications and many other growth segments of the semiconductor industry. Electronic functions such as voice compression and voice recognition, digital music and video compression, and other broadband communications all benefit from the use of DSPs.

Citing market research from Forward Concepts Co. in Tempe, Ariz., Schumacher said the annual growth for DSP technology is expected to be about 27 per cent through 2006. Worldwide revenue, he said, is expected to be about US$6.5 billion in 2003.

The partnership with Agere and Motorola is one of several the German semiconductor manufacturer has forged over the past couple of years, Schumacher said. Last week Infineon announced plans to acquire the chip operations of the Stockholm, Sweden wireless infrastructure manufacturer L.M. Ericsson Telelphone Co.