SANTA CLARA, CA – Computer graphics specialist Nvidia is buying phone-chip firm Icera for US$367 million in cash.
By offering the two main processors used in smart phones (the application processor and baseband processor), the combined company will help original equipment manufacturer customers both improve their time to market and deliver the requirements of next-generation mobile computing, the company said. Nvidia will also have approximately doubled its revenue opportunity within each device.
"This is a key step in Nvidia’s plans to be a major player in the mobile computing revolution," said president and CEO Jen-Hsun Huang, in the announcement. “Adding Icera’s technology to Tegra gives us an outstanding platform to support the industry’s best phones and tablets.”
Huang added that Nvidia intends to continue to collaborate with its existing baseband partners and respect its customers’ preferences in combining application and baseband processors.
Based in Bristol, England, Icera is a pioneer in next-generation, multi-protocol wireless baseband processors with RF components for 3G and 4G cellular phones and tablets. It has more than 550 patents granted or pending worldwide, and its high speed wireless-modem products have been approved by more than 50 carriers across the globe.
"Nvidia’s Tegra processor has the most impressive roadmap in the industry, and it is an ideal match for Icera”, said Stan Boland, president and CEO of Icera. “As part of Nvidia, we will be able to reach a broader market. Our team has collaborated closely with Nvidia for several years on a range of projects, and we’re delighted to be joining forces."
Jim McGregor, chief technology strategist for market research firm In-Stat, called the acquisition “a positive move for both companies and one that will further enhance Nvidia’s competitive position”.
“In many applications, such as tablets, integrated baseband has not been a requirement due to the current business models of mobile operators”, he wrote in an analysis of the deal. "However, as the business models change from being device specific to being user specific (the broadband bucket approach), having wireless baseband in tablets will be an advantage.”
The acquisition has been approved by both companies’ boards of directors and is expected to be completed, subject to customary closing conditions, in approximately 30 days.
