Samsung seeks multimedia clout in partnering efforts

Electronic News, July 31, 1995 by Anthony Cataldo

SEOUL, KOREA--Continuing to throw its weight behind firms rooted in multimedia, Samsung will partner with graphics chip maker Weitek Corp. as well as bolster its stake in start-up Array Microsystems, which recently launched a new video compression chipset. The moves are intended to give Samsung more clout in multimedia products by continuing its pattern of forging links with U.S.-based firms showing promise in that arena.

As part of the agreement with Weitek, Samsung will provide a foundry source for Weitek's products plus any jointly developed devices. The first generation of co-developed multimedia ICs for the PC has already been defined and is in development, said Barry Cox, president of Weitek.

"We expect that the first product in the family of jointly developed multimedia products will be introduced in early 1996," Mr. Cox said. "This partnership will allow Weitek to bring a family of next-generation PC multimedia products to market in a timely manner and provides Weitek with access to significant fabrication capacity for our entire product line."

Sang Wook Kim, executive director of Technology Planning for Samsung Semiconductor, said the deal will give Samsung a stake in Weitek's "world-class graphics and multimedia technology and early access to the multimedia market."

Samsung also gave Array Microsystems $4 million in funding, increasing to one-third its ownership in the Los Gatos, Calif-based firm. Samsung's ties with Array started in 1991 when it invested $1.5 million in the firm while providing engineering and manufacturing support.

Now moving into volume production, the Videoflow chipset--comprised of an image compression chip and motion estimator device--is the first product to roll out from Array, and is aimed to bring video capture, encoding, decoding and video conferencing capabilities onto a single PC add-in card, which will target sophisticated home PC users.

Samsung has rights to market the chipset in Southeast Asia, while Array takes the rest of the world, including the U.S. and Japan. The funding from Samsung will go toward expanding Array's sales organization, technical support staff and marketing efforts, said Paul Vroomen, Array's VP of sales and marketing. "This will basically fund us through our market development phase."

Samsung is also on track to shrinking Videoflow's die size from 0.8-micron to 0.65-micron as it moves to volume production. Eventually, the product will be fabricated on Samsung's 0.35-micron process for further cost reductions.

By forming ties with Array and Weitek, Samsung has shown a strong presence in multimedia from the chip to the systems level. Earlier this year, Samsung attained a 40.25 percent ownership in PC maker AST Research for a $378 million investment, allowing the Korean electronics giant to gain access to AST's large PC patent portfolio and opening the door to jointly developing a new type of multimedia system. Similarly, Samsung made a $1 million investment in Jazz Multimedia, a graphics board maker that specializes in MPEG (EN, March 6).