Altera vs. Xilinx: Take off the gloves: Daane's PLD skunk-works project debuts

Electronic News, Feb 11, 2002 by Gale Morrison

Ask Altera Corp. about its Stratix line of PLDs, which rolls out today, and the company will tell you it's a real killer.

Stratix is the fruit of a skunk-works project inside Altera, which the company claims is the future of programmable logic. Altera CEO John Daane, who is being closely watched by the industry, says Stratix will earn Altera $150 million by the end of 2003, at which point San Jose-based Altera will again be the No. I PLD supplier and "never look back."

Head across town and ask Xilinx Inc. the same question--admittedly, the company only had limited information last week--and it'll tell you there's no story here. The way Xilinx sees it, everything Altera claims is new is "technology we put into Virtex years ago," and Stratix is simply "yet another attempt [for Altera] to catch up to Xilinx," said Babak Hedayati, senior director of product solutions and partnerships at Xilinix. And, for the record, Xilinx is the current leader in PLD.

Welcome to the world of bare knuckles, no-holds-barred Xilinx vs. Altera competition. What Stratix means to the market and the two companies is, of course, somewhere in between.

"Is it the Xilinx killer?" asked Murray Disman, contributing editor for Chip Center.com and along-time programmable logic watcher. "Between [Stratix] and HardCopy, (Altera's new FPGA-to-ASIC conversion program), it's going to give Xilinx a little bit of grief. It's never a killer."

Disman said Altera definitely has delivered with Stratix's embedded memory. Danne (pronounced DAY-na) told reporters and analysts last week that the parts can contain as much as lOMbits of RAM in any combination of three styles.

"Ten megabits of memory," Daane reiterated in his closing remarks. "That's 3.3 times the amount of memory available in any PLD today. It's a tremendous boost."

Disman concurred. "That's just horrendous amounts of memory. lathe past Altera's Apex had quite a bit less than Xilinx's Virtex II. Now, it's quite a bit more."

But Disman said the real key will be the software. "They've got the software working well now," he said. That was a problem for Altera for a long, long time, even before Daane. They've got it cleaned up now and it looks quite good." Daane took over at Altera from Rodney Smith about a year and a half ago.

Stratix is ambitious, but so are Daane's expectations for it. The company said the first Stratix part will ship from Taiwan Semiconductor Manufacturing Co. Ltd.'s all-copper, 0.13-micron process in June, right about the time Xilinx promises its Virtex Pro, on IBM Corp.'s all-copper, 0.13-micron process, will ship. And if the first part isn't shipping until June, it means the engineering is not totally complete.

"They really are pushing hard," Disman said. "John Daane got up there and said next year they expect $150 million in sales. I thought that was kind of brave. That's awfully quick for a part ... they are not going to ship until June," he said.

Still, Xilinx's Hedayati said Altera needs to consider the gap it's trying to close.

"The product solution advantage from Xilinx has led to Xilinx winning the majority of FPGA designs with the Virtex-based architecture and created a giant gap between the two companies' revenues," he said. For the fourth quarter of 2001, Xilinx's pro forma net revenues were $228 million. Altera's pro forma net revenues for the same period were $162 million.

Altera promised customers doing DSP or other arithmetic functions that Stratix's better-optimized routing and interconnect and intellectual property possibilities will help them replace a $100 Apex part with a $25 Stratix part and still provide the same performance. Disman said Xilinx is going to hear about that from customers.

"If Altera's area claims are true, that will show up in the price, and it will make life difficult for Xilinx," he said. "I don't know if it will kill Xilinx, but it's going to make them sweat."