Taipei, Taiwan - Comms chip designer ZyDAS Technology Corp., another low-profile startup here, is showing its staying power in wireless LANs, ramping up a second-generation 802.11b baseband/MAC processor with an overdrive algorithm that pushes throughput to 16.5 Mbits/second.

In the crowded wireless LAN arena, the fabless design house highlights a proprietary multipath decoding technology that it says improves data throughput by more accurately interpreting wayward signals.

"Sometimes a reflected signal is not noise; it just arrived at a different time," said Norman Hung, president of ZyDAS. "If you can decode it, you can utilize it to get better signal strength. But without a proper algorithm, that signal may be noise to you."

The caveat is that the algorithm only engages when the access point and client use the ZD1202. In a market dominated by access points from Cisco, D-Link and Linksys-none of which uses the ZyDAS chip-finding an access point with ZyDAS chips may be a challenge.

Still, the company is digging in for the coming price war in 802.11b and the forthcoming 802.11g marketplaces. Hung half-jokingly refers to a low-cost reference design, in which the ZD1202 is paired with an RF chip from South Korea's GCT Semiconductor, as his company's "battle card."

ZyDAS will not only be going up against the likes of Texas Instruments, Broadcom and GlobespanVirata (which recently purchased Intersil's WLAN division), but also a fast-growing crop of Taiwanese companies, such as InProcomm, Realtek Semiconductor and Silicon Integrated Systems.

The company has had a few early bites, from consumer electronics maker BenQ as well as ZyXEL Communications Corp., the parent of ZyDAS and a maker of comms gear with good sales in Europe, Hung said.

It has also developed niches in the .11b USB 1.1 dongle market with its first-generation ZD1201, which used an ARM7 core for the MAC (the ZD1202 has a state-machine MAC) and included software that allowed the dongle to switch from being a client to an access point.

In December, admittedly late, ZyDAS will sample its .11g client-side chip, Hung said. That chip, the ZD1211, is also intended for the dongle market and will come with a USB 2.0 interface.

A few months after that, Hung expects near-suicidal pricing in the .11b market, a point at which the Taiwanese firms will really pick up market share because they can still manage on such thin margins. Around the same time, Hung also said more attention will be paid to the integration of WLAN chips in PC peripherals, replacing USB in applications like cameras, printers, game consoles and scanners. He even has a client exploring a WLAN mouse.

"Eventually, Intel's Centrino will take the major market share for WLAN chips-so our market will shrink," Hung said. "So we believe the peripherals market will be more suitable for a small company."

The ZD1202, made on a 0.18-micron mixed-signal process at UMC, comes with such features as Wired Equivalent Privacy, a hardware-based Temporal Key Integrity Protocol and Wi-Fi Protected Access.

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