Marvell buys Avera for ASICs as 5G networks demand specialist chips

Marvell may be eyeing the opportunity of being, once again, the leading chip vendor with an ARM-based server platform – if, indeed, Huawei has to pull back on its own ambitious cloud processor plans because ARM is complying with US-imposed restrictions on the Chinese firm (see separate item). However, the company is focused on building an end-to-end chip platform for telecoms networks and data centers, aware that success against Intel and Broadcom will lie in a portfolio approach, not leading in one solution only.

So the firm has made its second acquisition in the space of a few weeks, this time of Avera Semiconductor, the ASIC (application specific integrated circuit) business of GlobalFoundries, for $650m in cash, plus an additional $90m depending on meeting future targets.

Buying into an ASIC vendor mirrors moves by Intel and other rivals to surround their general purpose processors with other types of semiconductor which are optimized for specific tasks, in order to meet the highly demanding workloads of emerging technologies such as Cloud-RAN and cloud-based artificial intelligence (AI). Different combinations of chips can support customized architectures and specialist workloads, including GPUs (graphical processing units) and dedicated AI chips like Google’s Tensor Processing Units.

These chips come with varying degrees of flexibility versus fully optimized performance for a particular task. The pure ASIC is targeted at a certain workload, while the FPGA (field programmable gate array) can be programmed for one task and then reprogrammed for another, often supporting offload of intensive workloads such as RAN baseband processing, from the central, general purpose chip. There are also points in between, such as the somewhat reprogrammable eASIC, for which Intel made a play last year when it acquired the company of that name.

Marvell’s latest transaction, which also includes a new wafer supply deal with GlobalFoundries itself, is expected to close by the end of its 2020 fiscal year. The buyer says the combination of the ASICs with its existing off-the-shelf and semi-custom chips will create a “leading ASIC supplier for wired and wireless infrastructure”.

At scale and for the right tasks, ASICs can deliver better price/performance than general purpose silicon and can be used in a wider range of products, and there is expected to be rising demand for these semiconductors, driven by the rise of 5G and edge computing, which sees data being processed in a wider variety of locations.

IBM owned 25-year-old Avera until it sold its chip business to GlobalFoundries in 2015. The firm has offered a wide range of semiconductors during its history, and claims to have designed over 2,000 products in many categories including analog and mixed-signal. Its ASIC business, in more recent years, has taken center stage, with the focus on networking equipment including base stations, switches and chips. It claims to have supplied ASICs for the radio heads of “a leading wireless infrastructure OEM” for multiple generations.

It also has an extensive IP portfolio including high speed serializer/deserializer (SerDes), high performance embedded memory, and advanced packaging technology.

On Marvell’s side, it is adding more components to its plan to deliver a full 5G platform. It already provides chips that enable digital processing in basebands, Ethernet switches, PHYs and other elements. It has also been developing customized system-on-chip products for base stations in the virtualized RAN environment, and claims that it needs to combine fully purpose-built silicon with general purpose processors, rather than opting for the middle way of the FPGA, on which Intel made a big bet with its acquisition of Altera.

“Our acquisition of Avera enables us to offer the complete spectrum of product architectures spanning standard, semi-custom to full ASIC solutions,” said Matt Murphy, president and CEO of Marvell. “With their highly experienced design team and Marvell’s leading technology platform, we will be better positioned to capitalize on our expanding opportunity in wired and wireless infrastructure, starting immediately in the fast-growing 5G base station market.”

The purchase of Avera follows other Marvell acquisitions such as Cavium, which it bought for $6bn a year ago, and its recent takeover of Ethernet technology specialist Aquantia for $452m.

In the light of this deal, and Intel’s eASIC acquisition, all eyes will be on Broadcom, which has arguably been the biggest beneficiary of the shift from proprietary and customized silicon, towards merchant chips, in the telecoms network. Now the company, whose mobile ambitions suffered a setback when it was blocked from acquiring Qualcomm last year, may need to cast around for some new prey, to inject a new dose of customizable silicon into its portfolio.