Cypress sets rebound with 20K-Gate PLDs

Electronic News, Dec 23, 1996 by Jim DeTar

Santa Clara, Calif.--Cypress Semiconductor--while posting slower growth in revenues this year along with other memory and logic vendors--will follow up its recent move into the microcontroller market (EN, Dec. 9) with the introduction of a host of products in 1997 including planned new programmable logic devices that will reach the 20,000-gate level--significantly above the company's current 9,000-gate ceiling.

At the same time, Cypress plans to limit its exposure in the memory and programmable logic markets by possibly selling part of its programmable logic device (PLD) business and paring down its memory products portfolio.

During a recent broad-ranging breakfast interview with Electronic News, Cypress president and CEO T.J. Rodgers revealed that the company had a major technical setback in its programmable logic program late in 1995 that lasted through the early part of this year.

"Last year, we should have done better in PLDs. I wouldn't have even made backward revenue excuses if our PLD group had performed. But after years of design, we now have 14,000 software seats, we have superb software. After years of design-ins, last year we had a yield crash; it lasted for nine months. Worst possible yield crash on our CPLDs; a reliability-oriented yield crash, that is the wafers come out, appear to work, go in the package and then 30 days later die. And the reason for which they died was subtle.

"And I personally worked on the task force for six months until we finally figured it out. It's behind us but 1996 could have been triple in CPLD sales what it was, and we blew it because on top of our lack of attention and focus problems, we did finally get software and good product on the market, but we had a manufacturing problem."

Dr. Rodgers reaffirmed the company's commitment to stay in the PLD market in some form, however. "Yes, we are dedicated to that market and we're going to stay in it," he said, and added that Cypress will likely partner with other companies or broaden its current partnership with QuickLogic.

Cypress did $600 million in sales last year--it will likely make a profit but see lower year-to-year revenues this year--and has approximately 2,000 employees, of which about 1,200 are at the company's San Jose headquarters facilities. Its other big plants are Round Rock, Texas; Bloomington, Minnesota; and Manila, the Philippines, for assembly and test. "Our goal, our corporate mission statement is to be a billion-dollar company," Dr. Rodgers said. "We aren't going to make it this year. This year's going to put a hiccup in that. The goal's not going to change, but our current forecast is 1998."

While discussing his company's new CY7C63xxx line of USB microcontrollers, Dr. Rodgers also revealed that Microsoft will likely be a customer for Cypress' USB chip for its mouse products, and plans to develop a host-side USB chip to complement the company's initial USB controller for peripherals. He responded to a question regarding industry reports that the company came to market with the microcontrollers later than planned by deflecting the question and noting that at present Cypress is ahead of schedule.

EN: There are reports circulating that you were behind schedule by 60 days at one point while developing your microcontrollers.

Dr. Rodgers: "We're currently four weeks ahead of schedule. We were supposed to have silicon in January, we got a two-week shutdown--Christmas holidays--this year for the first time ever, to save money. And we jumped on the thing and pulled in ahead and got silicon out ahead of the shutdown, and the USB team is exempt from mandatory vacation.

"One good thing about having a small chip is that the logic will actually fit in a field programmable gate array. So we programmed FPGAs when we made the boards. Microsoft has actually demonstrated our USB function with their mouse at several shows. So we gave them a board and they put it in a nice little box, but basically there's a box and you plug in a mouse on one end and you plug in the computer on the other and it hooks the mouse into your computer.

"We have several other major design units. We expect to own the mouse world unless somebody wants to subsidize it. There's only one guy on the market with USB and that's Intel. And I asked our guys to look at the Intel chip. This is a micrograph of it (shows slide of Intel USB chip); their AX390 family. This is clearly an imported core, some sort of microcontroller and this I presume is a serial interface engine.

"If you look you'll see there's missing wires here, so what it says is that they've taken a big general-purpose microprocessor and are using only a fraction of its capability as opposed to having a completely optimized designed chip, which has no capability other than USB."

EN: The Intel chip is for both the host and peripheral sides. Right now your chip is just for the peripheral side. Would you have to make a larger die to have capability on the host side as well?

Dr. Rodgers: "Yes. We have a chipset and our chipset is the 7C691, -2 and -3. The '693 is a subset which is a PCI bus to the world. We currently ship that. The version we currently ship has four empty pins and they're VCC, ground, data and data bar--those are USB pins, the four pins in the plug.