Startech setting high ground strategy

Electronic News, April 4, 1994 by Jim DeTar

SUNNYVALE, CALIF. -- Startech Semiconductor, which may go public this year, is preparing to take on market leaders National Semiconductor and Standard Microsystems Corp. (SMC) in the single-chip, I/O controller market. In addition, the company is preparing to introduce its first product fabricated on 0.8-micron technology--successor to the 1.2-micron process the company has used to this point, according to Ram K. Reddy, Startech's president and CEO.

Startech's first volley in the single-chip PC I/O market will be a new product called the ST56C5XX controller, which the company plans to roll out this fall. Mr. Reddy told Electronic News in an interview last week that this is a natural evolution for the four-year-old company which has established a presence in the universal asynchronous receiver/transmitter (UART) and frequency synthesizer markets. Although it uses its own designs, Startech is one of the few companies licensed by National to use its FIFO UART patent.

"Today we are the leaders in 16550 base (UART) products," Mr. Reddy asserted. "We are entering a new area of superintegration. We call it super I/Os. The next automatic move for us is suprintegration on the motherboard, where they have UARTs with FIFOS and clocks, frequency synthesizers and floppy controllers. It's a real move for us to get in and take all these products and integrate them into one product on a 120 or 100-pin chip and call it super I/O.

"It comes in all flavors because you have several different motherboards available today. There are 60 million 486s they make each year now, and not all 60 million are the same configuration. They all have a 486 in common but configurations are different: two serial ports, a parallel port, an IDE--they come in different functions. So we have a family of super I/Os. The first product is going to come out this fall, followed by a family of products in the next year."

Startech's planned initial entry in the super I/O controller market, dubbed the Model ST56C5XX, will feature a floppy controller licensed from Western Digital, two serial ports, Microsoft/Hewlett-Packard Bi-directional ECP parallel port, IBM EPP (enhanced printer port), 16-bit IDE interface, game port and others. Mr. Reddy said he believes there is room for one more competitor in the PC I/O controller arena because it is basically dominated by two companies.

"There are only two people who compete in that area. The significant players are National Semiconductor and SMC. We will compete against them."

Mr. Reddy's strategic goal for the company is to position Startech as among the leaders in the data communications market. "The aim is to do products in data communications, meaning the PC connected to the outside world through a telephone line. We want to improve performance and the quality of the transmission of data going from the PC to the outside world through telephones, through modems and through faxes."

In addition to the super I/O family, several new families of products are in the works, primarily targeted at the data communications environment.

"We have a whole series of UART products and series of frequency synthesizers, very small SOIC, very high analog technology. Most of the motherboards have a 14.3 MHz crystal. Then they have VGA, CGA--all kinds of graphics modes, and then you have CPU clocks, communication clocks, keyboard clocks, several crystals. You take all of those crystals and put them in one chip; it saves a tremendous amount of cost of place-and-route and FCC problems and all that stuff. We've got a whole series of those products coming up."

Although Sunnyvale, Calif.-based Orbit Semiconductor is Startech's sole foundry at present, Startech has had discussions with Taiwan Semiconductor Manufacturing Corp. (TSMC), Chartered Semiconductor, Sharp, Seiko-Epson and American Microsystems Inc. (AMI) and will shortly announce agreements with one or more new manufacturing partners, Mr. Reddy said.

As reported (EN, March 28), AMI is currently looking to add fab capacity for its own parts as well as line up additional foundry business.

Currently, Orbit is manufacturing Startec's products on 4-inch wafers. When Startech begins manufacturing using a 0.8-micron process, it will switch to six-inch wafers, Mr. Reddy said. In fact, the company is currently "shrinking" one of its current 1.2-micron products to the 0.8-micron level and others will follow.

The super I/O is one of many products Startech plans to add to its current 40-product lineup over the coming year, and which it is counting on to propel new sales. The private company reportedly has been profitable for more than four quarters, had $5.9 million in sales for fiscal 1993 ended Sept. 30, 1993, and expects to report revenues of $12.1 million for fiscal 1994.

Startech recently added Compaq to its customer list, according to Kevin Anderson, Startech's vice president of sales. It also lists on its roster of more than 60 systems customers: Acer Inc., ALR, Dell Computers, Exar Corp., General Motors, GTE Airfone, Hewlett-Packard, IBM, Nokia Mobile Phones, Rockwell International, Siemens, Sony and Tandy.