TI unveils two chip families

As consumers demand ever-faster connections to the Internet and gee-whiz devices, TI will be supplying manufacturers with a new generation of chips to meet that need, chairman Tom Engibous said Tuesday.

"We will make the broadband pipe to the home faster and cheaper," Mr. Engibous said in an interview, describing one new family of chips.

At the same time, Mr. Engibous said, TI has developed another chip that will greatly extend the battery life of portable electronic devices. He predicted that this chip would let TI increase its 48 percent market share of the digital signal processors used in cell phones.

Dallas-based TI unveiled both chip families during a New York foray that featured a conference with analysts, media interviews and Mr. Engibous ringing the opening bell at the New York Stock Exchange. Investors cheered the company's news by sending TI shares up $15 to close at $149.

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roadband refers to high-capacity communications networks capable of transmitting high-speed data, voice conversations and video images -- often at the same time. Communications companies are making huge investments in broadband networks so they can sell more services to customers and charge premium prices for the improved access.

Mr. Engibous said that positioning the company's technology in both the broadband and wireless markets "is perhaps the most important development'' for TI in years.

Mike Hames, worldwide manager of TI's digital signal processing business, said in an interview Tuesday that service providers such as Southwestern Bell will be able to respond to demand quickly by upgrading equipment with the new programmable TI C64X chip.

"The way to get the service providers to deploy our technology is, frankly, competition,'' Mr. Hames said. "When a customer calls their phone company and asks for nine lines, we'll be there to provide the technology to make that!
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happen.''

The other chip family, designated C55, is more of a product extension for now aimed mostly at the cellular phone market, where battery life is important. TI says the chip reduces power consumption by 85 percent, enabling cell phones and other similar devices to last weeks instead of days.

TI said both Nokia and Ericsson have committed to putting a version of the C55 in their third-generation phones. When questioned by Wall Street analysts about the strength of the manufacturers' commitment to use TI chips, Mr. Engibous was emphatic.

"We have public statements from both Nokia and Ericsson that they are committed to this technology,'' he said. Later, Mr. Engibous challenged an analyst to "Go ask Nokia'' about whether any competitors are ahead of TI.

Officials with Nokia and Ericsson confirmed their plans for the new TI chips.

TI is trying to stir broader public interest in its new chips in part by talking about their "Dick Tracy'' capabilities. Analysts s!
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ay many of the new applications are eye-popping -- for instance, giving a doctor the ability to send medical tests in real time to a patient over a cell phone.

But Mr. Hames said that although TI must know the consumer market, it's not in the business of driving demand. "We sell Bibles, not religion. It's impossible to know exactly what the new killer application will be.''

Will Strauss, a semiconductor analyst with Forward Concepts Inc. in Tempe, Ariz., called TI's new chips a "one-two knockout.'' But he was skeptical about customer demand materializing for, say, seeing the person on the other end of a telephone conversation.

"Nobody cares about headshot videos. It's cute, but it's totally impractical,'' Mr. Strauss said.

Both new TI chips will be available commercially this summer. Consumers can expect to see products powered by them within a year, the company said.

Initial production will take place at TI's Kilby fabricating plant in Dallas. Substantial production!