MaxLinear has been slowly, some might say too slowly, turning into a genuine force in the fabless RF tuner market, since it went public back in April 2010. Now it has landed the main tuner device inside at least one Samsung TV design, and perhaps all of them (although the statement was not clear on how many deviecs it is in).
This is the big prize it has been aiming at for the past few years and on its investor caution wording every quarter it says something like ‘it takes years to negotiate deals for these components with companies the size of (long list including Samsung) and this takes a lot of investment.’
At its IPO MaxLinear raised $82.8 million before costs and this valued it at something like $570 million. Today that value has gone down to just $231 million, mostly due perhaps to US investors not really understanding the opportunities that it has in front of it. Last quarter it actually generated cash and still has some $76 million in the bank, enough to make an acquisition it it felt it needed one. On the back of this Samsung deal we would not be surprised to see it go to the markets for a top up.
MaxLinear kicked off designing an ISDB-T tuner for the Japanese market, especially low power devices for the 1-seg broadcast TV handset market. That market remains strong with something like 80 million regular TV viewers in Japan via handsets. The same story has included deals for MaxLinear in Latin America where it has based TV and mobile broadcast TV on the same standard.
One of the deals that will keep the MaxLinear revenues ticking over was one with ST Micro this May for ISDB-T designs for tuner chips in ISDB-T set tops for Latin America.
MaxLinear has cleverly wrested its fate from the mobile broadcast TV market, and although it has had one foray into ATSC M/H for the US mobile TV market, it has tied its fate to the death of the Can Tuner in TV sets, and pursued this through TV sets, set top boxes and DOCSIS modems. It is probably only the second company in the world, after Broadcom, to offer a single capture (full spectrum capture) across wide swathes of the entire cable TV bandwidth, which it needs to scan and capture for handling multiple channels at once in a single component. It is this skill that has helped in DOCSIS where devices wish to multiplex up to 24 and more channels at once for really high speed broadband.
It has cut deals with Intel and Arris for DOCSIS tuners, and we understand that it can be found in TiVo devices (although that has never been made public). But the holy grail has been the $500 million TV tuner market and in Samsung, which has 28% of the global TV market, and is by far the largest player, MaxLinear has finally landed the big one. If it is only in one or two deviceds now, that should blossom into the entire range over time.
We suspect that Samsung would have done its own tuner if it had the technology in-house and see this as a huge vote of confidence in MaxLinear. The initial order does not have any details in it, so no particular number of devices or models that will have MaxLinear components, but if Samsung uses it, other TV companies will be beating a path to the tiny US company’s door. Expect more deals, and expect a dramatic upswing it its share price and its balance sheet.
The announcement was simply that MaxLinear has begun production shipments of its MxL6xx family of software-programmable, low power, global hybrid television tuners to Samsung for TVs.
‘We are excited about Samsung’s selection of our global hybrid silicon tuners for its television products,’ said Brian Sprague, Vice President and General Manager, Broadband and Consumer Products at MaxLinear. ‘Our more than eight years of experience designing and shipping tuners based on pure digital CMOS technology allows us to provide uncompromised performance at the lowest power at highly competitive prices.’
The MxL6xx family of tuners offers low power consumption of around 350mW or less and comes in a compact 4 x 4 mm footprint and can work with all global broadcast standards including PAL, SECAM, NTSC, DVB-T ISDB-T, ATSC, ATSC and DTMB in China. All the recent MaxLinear tuners are cut in 65 nanometer CMOS.