Cypress Semiconductor Inc is to take over the development of USB peripheral controllers and development tools from Intel Corp, following a licensing deal announced yesterday. The two said they would work together to provide a smooth transition. Terms were not disclosed. Intel will exit the USB silicon market, but continue to drive it through software and the PC Desktop initiative, the company said.
Cypress, which acquired privately-held Anchor Chips Inc for $15m back in May for its USB and PCI chip business (CI No 3,669), says the licensing deal gives it command of over 50% of the USB peripheral control market. It shipped its first USB chips in the first quarter of 1997, and says it has now shipped a total of 20 million. USB chip sales are expected to account for around $30m in revenue this year at Cypress, which is moving away from its traditional SRAM business into more lucrative communications chips.
Under the new deal, Cypress gets the rights to the Intel 8×930 and 8×931 families, including various single chip USB controllers. It will take Cypress further into the high-end of the USB market, aimed at printers and scanners, and could add around $20m to revenue next year. Cypress also gets non-exclusive access to chip designs from Intel supporting the forthcoming, much faster USB 2.0 specification. Before the Anchor acquisition, most of the company’s business was concentrated on silicon and tools for so-called low-speed devices such as mice, joysticks, and keyboards. The first USB contract Cypress won was to design and supply chips for Microsoft Corp’s Intellimouse.
At the recent Intel Developers Forum, the target speed for USB 2.0 was revised sharply upwards a range of between 360 and 480 Mbps – which would make the new version between 30 and 40 times faster than USB 1.0. The USB Promoters Group, which aside from Intel includes Compaq Computer Corp, Hewlett-Packard Co, Lucent Technologies Inc, Microsoft Corp, NEC Corp and Philips NV, is set to announce the final target speed for the new version at the USB 2.0 Developers Conference in San Diego next month. The announcement is expected on October 12.
