Saturday, October 2, 1999
Big Chip Order
Technology: Irvine-based niche
leader looks to New York cable company's plan for 3
million set-top boxes.
By ERIK SCHATZKER, Bloomberg
Broadcom Corp. expects to supply
semiconductors for up to 3 million cable television set-top
boxes for Cablevision Systems Corp., the largest
cable-TV company in the New York metropolitan area,
Broadcom Chief Executive Henry Nicholas said Friday.
Cablevision Systems is buying the set-top boxes from Sony
Corp., which is likely to call on Broadcom to supply
many if not all of the semiconductors, Nicholas said
in an interview at a conference in Squaw Valley.
Irvine-based Broadcom is the No. 1 maker of semiconductors for
digital set-top boxes and cable modems.
confident that we'll end up with a very significant part of
the silicon content in that box," Nicholas said in an
interview at Telecosm '99.
Broadcom, which started by
making chips that speed Internet access for homes and
businesses and for digital TV converters, stands to benefit
as cable operators move to combine those functions
in a single box.
Last month, Cablevision agreed
to pay Sony $1 billion for 3 million of these boxes,
which use three or four chips to combine phone access,
interactive programming, more channels and Internet access on
Nicholas said the agreement is
"material and important" for Broadcom. It won't be the
company's biggest, though. Broadcom company sells more to
Motorola Inc., which buys semiconductors for its cable
modems, and General Instrument Corp., a maker of set-top
Motorola last month agreed to buy General
Instrument, a move Broadcom expects to benefit from. Broadcom
shares fell after the acquisition was unveiled amid
concern that the company would lose General Instrument
sales to Motorola's chip division.
The share drop
"puzzled me," Nicholas said. The acquisition "lets us take
a lot of the things we do with Motorola and blend
them with General Instrument."
On Friday, Broadcom
shares rose $3.50 to $112.50. The stock has gained 86%
this year, giving the company the currency to make
five acquisitions since June.
Copyright 1999 Los
Angeles Times. All Rights Reserved
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To compare ramblings of AMD's CEO to that of
BRCM's is misguided. While AMD has proved itself to be
quite reliable at coming up short on promises and
projections, not the least of which are its earnings and
delivery capability, BRCM has consistantly been able to
meet delivery and exceed earnings projections. Thus
far BRCM has also strategically aquired many
complementary businesses boosting its potential in the
marketplace. I would be very suprised if BRCM made
announcements without having at least a "bird-in-hand."
Also, I am pleased to hear that BRCM is not going to
purchase any sports teams, as doing so would in my opinion
hurt their image with stockholders. BRCM has
consistantly demonstrated focus on BROADening market
a bird in hand. If he did he would have said
The Sony boxes are supposed to be delivered NEXT
YEAR. There are other companies such as CUBE and ATI
which are also under consideration for the Sony
Its NOT a Given that BRCM has the design win.
Nicholas IF HE DOESN't get MOST of the chips in that box,
will look like a FOOL.
how probable do you think it is that CUBE wins
the sony business?
i think nicholas is safe in
'bragging' about winning the contract. if anything, nicholas
is pretty quiet in situations where other ceos would
be painting the tape.
<<Its NOT a Given that BRCM has the design
What is your point here? It's not a given that the sun
will come up tomorrow either. Even signed contracts
can be voided. Henry responded to a question and
responded given the information he had available.
you really think he's a boob then sell your stock and
move on. It's really strange to hear someone discredit
a CEO for doing some very aggressive PR. Would you
rather he issued a 'no comment' for
Sorry, but you really sound like you have something
personal with Nicholas.