'New' Exar to emerge with clearer focus

Electronic News, Dec 16, 1996 by Crista Hardie

Fremont, Calif.--Exar is about to come out of its shell.

The 25-year-old mixed-signal IC company has kept a fairly low profile while enduring the turbulence of the last several years--from the loss of key accounts to the loss of a fab when its former Japanese parent, Rohm, pulled the plug.

Recovery began with a handful of acquisitions to bring in fresh opportunities, but was offset by tight capacity, then overcapacity and subsequent layoffs.

George Wells, who led Exar from 1992 until October of this year and remains on Exar's board of directors, has seen his share of industry ups and downs in his 36-year semiconductor career, which included stints at Fairchild Camera and Instrument, GTE Sylvania and as president/COO and vice chairman of LSI Logic.

In 1994, with an independent and suddenly fabless Exar under his guidance, Mr. Wells began a strategy to build Exar's revenue potential. A string of acquisitions that included MicroPower, Startech and Silicon Microstructures built a technology base that may prove key to such emerging markets as multimedia computing and smart sensors.

In October, Exar named Don Ciffone to succeed the retiring Mr. Wells as president/CEO. With a broad base of technology in place and the reins firmly in the hands of VLSI Technology's former senior VP of products, Exar is preparing to re-emerge with a clearer identity, a picture of what it wants to be when it grows up.

Electronic News had the opportunity recently to discuss the company's past, present and future with Messrs. Wells and Ciffone, who share a common vision for what they call the "analog-plus" company.

EN: Exar has been fairly low-key in the past. Are there plans to make the company more visible?

Mr. Ciffone: "Yes. One of the things that I'm trying to also do is our marcom activity historically has been focused on product organization and product launch. What I'm trying to do is get a balance so we can also put some focus on the corporate side to try and unify externally some of the messages about who Exar is. There's a tagline that has been created that George has helped to evolve which describes Exar as an 'analog-plus' company, which I think is a good foundation. And George led the company through a transition in terms of getting the operation entity corrected, getting some technology and, through acquisitions, trying to create a real entity, not a shell of a Japanese company.

"Now, what I've been tasked to do by George and the rest of the board is to infuse more product focus. And part of infusing that product focus, what we have to do is clearly establish and bring into focus who Exar is and what Exar is. If you look at other companies our size, some of them are focused, like Level One, for example, is a communications company. Linear Tech, niches, broad base, you know what they're going to do. Analog Devices, you know what that company's about.

"Exar, it's a little bit less clear, so part of what I'd like to be able to do as we go through this product transition is then be much more visible in reinforcing what that message is to the marketplace. Because it helps on a lot of fronts. It helps with people like yourselves so you know where there would be interest as you're working on different things, how to position the company; it helps with the financial community; it helps with things like recruiting, when you go to colleges and you're competing against these other companies and you're trying to sell who Exar is. And it also helps to create more synergy in the company, because then there's more of an opportunity for people to pull in the same direction.

"So that is a key thrust for us."

EN: Who are some of your major customers?

Mr. Ciffone: "If you look at kind of the core competencies from a products standpoint, the video imaging is the strength that the company has, probably due to its A-to-D technology. And, one of the acquisitions George made, MicroPower, a key customer for them, for example, would be like a Sun (Microsystems).

"Another area where there seems to also be some core competency is on the communications side. Clearly, for a mixed-signal company to be successful long term, you have a presence in communications. And Exar, historically, has had a good presence in transmission. So that's something we want to look at continuing to try to amplify, and do business with people like Nokia.

"The third area is one that's really just an embryonic technology which is the area of sensors. There's a company that was acquired called SMI, Silicon Microstructures, that have some expertise in blood pressure sensors. And today that's a relatively small market from an IC standpoint. But it has strong upside potential in terms of its growth. We've talked to some of the major automotive manufacturers, and there's a lot of interest in disposable medical applications. For example, there's also a lot of industrial things, like heating and air conditioning kinds of systems. Those are becoming computerized, there's a lot of sensor technology required for that. So there's a lot of opportunity there.