Chip Uncertainty

Michael Hedges October 15, 2012 Follow on Twitter

See full article in Italian from Corriere delle Comunicazioni here

Digital technologies have long been seen as a universal cure-all. The media world lingered, at first, before jumping into the swamp of ever-changing digital solutions. Not tethered to legacies, technology developers pushed forward, upward, onward. There’s a chip for everything. So fast have they moved that last year’s miracle is gone forever.

Chips were on the minds of the European Broadcasting Union (EBU) and its members, meeting in Brussels for the annual Digital Radio Conference. Public broadcasters have, generally, led the charge for analogue to digital transition in the radio sphere. The push is on for “accelerated roll-out” of a universal chipset – the Eurochip - enabling all new radio receiving devices to access every possible platform and standard.

“Digital radio across Europe has been plagued by uncertainty,” observed BBC Director of Audio and Music (aka: radio) Tim Davie. “We may be reaching a tipping point, but first we have to bank what is certain about radio's digital hybrid future and join forces to promote a common vision across Europe.” (See EBU statement here)

All trade association meetings held in Brussels have a singular purpose: attention from the European Commission (EC).  Radio broadcasting has never been a significant agenda item with the EC but the pan-European market for technology is near the top. The most widely used family of digital radio broadcast standards was developed in Europe. When Asian chip designers and consumer electronics manufacturers took a pass on digital radio, European companies jumped in even though consumer uptake outside of the UK and Scandinavia has been perilously slow.

While the EBU statement made no mention of manufacturers for the multi-platform radio chipset one is likely STMicroelectronics (ST), based in Geneva, Switzerland. It is Europe’s largest chip-maker. ST introduced a digital radio chipset supporting the range of DAB standards plus DRM and good old analogue AM/MW and FM, reported eetimes.com (July 19). The chipset was designed in cooperation with Bosch Car Multimedia, for “next-generation in-car infotainment,” forever the missing link in digital radio development.

As it might happen STMicroelectronics is rumored to be restructuring, reported Bloomberg (October 12), off-loading its digital business making semiconductors for mobile phones (yep, iPhones), television and TV set-top boxes in favor of its analogue business, which makes chips and sensors for cars and video-game consoles. If you haven’t noticed there’s a bit of a war going on among chipmakers and their various EOMs. Divesting ST’s digital business would be complicated as the French and Italian governments own 27%, attention of the European Commission being paramount. The company denies the rumors.

By far the chipmaker most heavily invested in the DAB family of standards for digital radio is UK-based Frontier Silicon. Virtually all stand-alone digital radio receivers use chipsets from Frontier Silicon, which has held first-mover advantage for a decade. The company offers a blinding array of IC and network solutions for digital radio and first produced a multi-standard chipset in 2008. Most recently the company introduced a multi-standard digital and analogue product for the iPhone 5. In July Toumaz, another UK chip-maker, acquired Frontier Silicon three months after Frontier Silicon founder Anthony Sethill became CEO at Toumaz.

UK-based chip designer Imagination Technologies, also long involved in digital radio chip development, has had a rough couple of weeks. The company owns digital radio receiver manufacturer Pure. Its share price tumbled (September 26) when US partner Texas Instruments announced it would exit the smartphone and tablet business and further (October 10) on an unfavorable report from stock analysts.

“We need to expand the business beyond digital radio,” said Pure marketing director Colin Crawford to whathifi.com (January 6). “While digital radio is slightly bucking the downward trend in consumer electronics in the UK, our biggest growth is in export markets.” There’s never a dull nanosecond in the chip business.

“The tools that supported ICT in yesterday’s world won’t work in tomorrow’s,” said European Commission Vice President for the Digital Agenda Neelie Kroes (September 25), describing plans to spend the €80 billion Horizon 2020 fund. “The pace of change, the capacity for new disruptive ideas, is simply too great. We must update our policies and practices for the digital world.” Emphasis, she said, will be on “real products, real services, real jobs.”

A universal ‘Eurochip’ is an attempt to solve one major problem, albeit the least expensive, for digital radio developers. But it’s a forward-looking solution, assuming broad interest in ever more radio channels and, possibly, the shut-off of analogue transmissions. The DAB+ standard, considered more efficient, is not downwardly compatible with the older DAB standard, widely adopted in the UK, Denmark and, awkwardly, Switzerland. Public broadcasters in these countries have offered DAB radio channels, added some, dropped some, added more, dropped more all adding to consumer confusion. Early adopters, particularly in high GDP countries, don’t mind. Others may prefer that new iPhone to yet another digital radio receiver. Then, too, 4G internet access changes everything… again.

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