By midyear, several vendors will be in full production, with four- and eight-channel devices with 3.125-Gbit/s serial links. This is timed to coincide with increased design activity surrounding OC-192 and 10-Gigabit Ethernet line cards.

Though the majority of semiconductor vendors will be peddling more or less standard devices, there are a few standouts with interesting differentiation in product or strategy. On the product front, Agere Systems and Cypress Semiconductor will introduce backplane transceivers with integrated programmable logic. Though the logic is mainly intended to serve as glue between network processors and the serial backplane, one should expect that such logic would, someday, be capable of implementing custom encoding schemes. On the strategy front, Agilent is a standout by virtue of its plan to build ASICs for tier-one system OEMs that include its proven backplane interconnect technology.

Today, the price per 1.25 Gbits/s of backplane interconnect bandwidth is hovering around $7. That number should fall this year, yielding an average for the year of roughly $5 per 1.25 Gbits/s. Despite the pricing pressure, it is not all gloom and doom for semiconductor vendors. Gartner Dataquest expects backplane transceiver ICs to grow 52 percent, from $100 million in 1999 to nearly $830 million in 2004. Major applications driving that growth include Gbit and 10-Gbit Ethernet switch systems, xDSL and cable modem broadband infrastructure systems.

As an early prediction, the end of 2001 or the beginning of 2002 should see a similar trend in the optical backplane market with the introduction of very short-reach transceivers using parallel vertical cavity surface-emitting laser array optics.

Jeremey Donovan is a Principal Analyst for Communications at Gartner Dataquest (jeremey.donovan@gartner.com).