SAN MATEO, Calif. NeoMagic Corp. is poised to jump back into the semiconductor market after more than a year away. But instead of graphics components aimed at notebook computers the product generally associated with the company NeoMagic is moving into an entirely different segment with a family of parts designed for the handheld Internet appliance market.
Prakash Agarwal, NeoMagic president and chief executive officer, said that graphics was never the main focus for his Sunnyvale, Calif.-based company. "Embedded DRAM was always our specialty, and our focus has been on mobility," he said. "Embedded DRAM is the ideal technology for mobile applications because it allows for lower power consumption, longer battery life and smaller footprints."
The company plans to sample its first chips for portable, Internet-enabled applications shortly. They will include memory, MIPS-based processor cores and analog components, all on a single die. Future versions may have different processor technologies, but they will always include all of those components.
"Until you have all three of these functions, you can't really call your design a system-on-chip," said Agarwal.
Mark Singer, vice president of marketing for NeoMagic, divides the handheld Internet appliance market into three major segments. Applications that focus on productivity include PDAs and Web pads; entertainment applications include digital audio and portable gaming systems; and wireless telephones and pagers fall under the category of personal communications devices.
Though there is overlap in functionality among those groupings, Singer said that all three categories will involve different devices, with specific functions. "It is our intent to target all three of these segments," he said.
NeoMagic was once an important player in the notebook graphics market, but last summer chose to retreat from that space. Late to market with a 3-D component in 1999, the company lost key market share. At the same time, Agarwal said, the entire PC graphics market was shifting to integrated technology that merged graphics with core logic. NeoMagic was faced with the choice of playing catch-up in a shrinking market or of finding an entirely new target.
Though NeoMagic reported quarterly sales as high as $70 million in late 1999, revenue dropped to just $200,000 last quarter. Agarwal said that sales for the rest of the year should stay fairly low, as the company will be sampling parts but not shipping in volume. But 2002 should be a breakout year.
"We are poised to come out of our cocoon," said Singer.
NeoMagic's chips are produced on a DRAM manufacturing process, with Infineon Technologies AG serving as the foundry. The initial parts will be manufactured at the 0.2-micron node the same process used for 64-Mbit DRAM chips and will pack as much as 8 Mbytes of embedded DRAM. Later versions will come out on the 0.17-micron node, which is used for 256-Mbit DRAM devices, and then the 0.13-micron level, which will be used for 1-Gbit DRAM components. Singer said that the parts will soon have as much as 16 Mbytes of embedded memory on-die, eventually doubling to 32 Mbytes. Later designs may also include wireless functions.
Agarwal said that initial reaction from potential customers has been positive, though there are no formal sales deals yet.
One major target will be the Palm and the Handspring PDAs, which currently feature 2 to 8 Mbytes of embedded memory. Both companies have indicated a willingness to switch chip designs in future versions, Agarwal said, and extra on-board memory could sway their decisions.
"We are pretty confident about our future," he said. "Right now we consider ourselves a well-funded, public startup company. We don't expect to see much revenue this year, but we think our chances will be very good next year."