Continuing its run into the communications sector, Intel Corp. has set plans to enter the Digital Subscriber Line (DSL) modem and chip markets by acquiring some technology from communications-equipment giant Cisco Systems Inc.
Under the terms, San Jose, Calif.-based Cisco plans to sell its consumer-oriented DSL-based modem hardware business and other key hardware and chip technologies to Intel for an undisclosed amount.
However, Cisco--which has major alliance with US West and others in the DSL arena---will now focus on developing higher-end DSL-based equipment for the central office, the companies said.
In the third quarter of this year, Intel will roll out its first consumer-oriented DSL modems. The products--to be sold under the Intel brand name--will be designed for use in ADSL and G.Lite applications. ADSL is a business-oriented modem technology designed to transport data at 8-Mbit/s; meanwhile, G.Lite, a stripped-down version of ADSL, is geared to move data over existing phone lines at 1.5-Mbit/s--roughly 25 times faster than today's analog modems.
Intel was one of the founding members of the Universal ADSL Working Group (UAWG), an organization that helped develop the G.Lite standard. The International Telecommunications Union (ITU) approved G.Lite as worldwide DSL standard on June 22, 1999.
Initially, Intel's DSL modems will be built around chipsets from undisclosed third-party suppliers, reportedly GlobeSpan Inc. and others. In fact, Cisco's consumer-oriented DSL modems, which were sold to US West and others, were based on a coding technology developed by GlobeSpan called CAP.
In the future, Intel hopes to develop its own DSL-based chipset lines based on the rival coding technology--DMT--which has been adopted as the standard in the industry, said Dan Wagner, product line manager for Intel's Broadband Access Operation. .
"Longer term, our goal is to add more value at the silicon level," Wagner said. "It is our intent to develop our own silicon products."
Intel declined to elaborate on its chip plans , but the company's move into the DSL-based IC arena will put it in direct competition against more than a dozen suppliers, such as Analog Devices, Alcatel, Conexant, GlobeSpan, Integrated Technology Express, Lucent, Texas Instruments, and others.
Worldwide DSL subscribers are expected to increase 150% in 1999 and reach two million new subscribers in 2000, according to the In-Stat Group.