DiBcom comes armed with the industry's most thoroughly tested mobile digital TV chips, capable of 24-Mbit/second error-free digital reception at 150 miles per hour. The deal, to be announced today, will see Intel Capital, Intel's venture capital arm, invest an undisclosed sum in DiBcom, founded in 2000.
By aligning itself with Intel, DiBcom is expected, in the near term, to get a substantial advantage over its competitors in the growing portable digital TV/PC market. By its own account, DiBcom is predicting that almost all laptop PCs will have digital TV reception capabilities by 2008.
Intel also gives DiBcom a needed financial boost so the startup can joust with a host of giant chip vendors seeking to integrate mobile digital TV into cell phones. DiBcom's competitors in the increasingly torrid DVB-H (digital video broadcast-handheld) chip market include Texas Instruments, Freescale, Philips Semiconductors, Samsung and STMicroelectronics.
DiBcom CEO Yannick Levy said he hopes Intel's investment will emulate the successful course of corporate and market development for CSR, a British Bluetooth chip developer. Some see Intel's investment in CSR in 2000 as a key to CSR's success. Intel's interest in CSR has made Bluetooth more widespread in the linkage of PCs, notebooks, PDAs and phones.
DiBcom raised $30 million in its recent round of funding, including investment from Intel Capital, UMC, Partech, 3i and WI Harper. Levy said the UMC investment is also strategic, because it helps guarantee cost and manufacturing capacity for DiBcom's chips, as DiBcom's customers plan to integrate DVB-H solutions in a massive number of mobile phones.
The DiBcom investment also aligns with Intel's ambitions. The chip giant is intent on bringing entertainment to the PC platform. Intel is also putting a lot of resources behind efforts to crash the emerging market for mobile phones equipped with TV-on-mobile features.
At the Intel Developer Forum, a notebook computer and a PDA were shown receiving a live digital TV feed, transmitted via satellite. Its creator was Crown Castle Mobile Media in Pittsburgh, which operates an ongoing DVB-H trial using the 1.672-GHz L-band. The demonstration used Microtune's miniature RF tuner and DiBcom's DVB-H demodulation chip connected to a notebook PC via USB and to a PDA via a secure digital connection.
To integrate DiBcom's DVB-T/DVB-H demodulation into Intel's PC and mobile platforms, "we may have to make some changes on our chips," said Levy.
When one looks at the natural history of semiconductors, it suggests there is the risk that DiBcom's technology might be swallowed up by Intel's platforms whether PCs or mobile handsets.
But Levy said, "I'm not too worried." He pointed out that mobile phones today are morphing into small PCs. A mobile handset contains a CPU, graphics chips and front-end chips, just like a PC. "Just as it doesn't make sense to get an Ethernet modem integrated into a CPU, things like Bluetooth, Wi-Fi and DVB-H will remain as separate components in a handset," he said.