CSR released its 2Q08 results today. Quarterly revenues are 13% down year on year ($188.4m vs. $215.9m), but in line with expectations and up 17% on Q1. The CEO blamed the decline on “macro economic pressures.”
The press release says that CSR has completed “repositioning the business around the Connectivity Centre.”
What CSR calls the “Connectivity Centre” was the topic of a report I wrote with the Linley Group last year and which we are in the process of updating for 2008. The idea of the connectivity chip is that cell phones have a multiplicity of radios in them these days: several cellular standards and frequencies, Bluetooth, FM radio, GPS, Wi-Fi and some other minor ones. The way it has shaken out so far is that cell phone OEMs have implemented each of the non-cellular radios separately on their phone motherboards, or with two or more of them mounted together on a multi-chip module, or “connectivity chip.” Recently many vendors have started doing single-die implementations of connectivity chips, like Bluetooth plus FM, or Bluetooth plus Wi-Fi.
CSR with its BlueCore 7 is the first to combine Bluetooth (plus Bluetooth LE, formerly Wibree), FM (transmit and receive) and GPS on a single chip. This looks like a winning combination, because these three technologies are the ones with the highest attach rates to cell phones, and CSR has managed to implement the GPS with a sufficiently modest silicon footprint that CSR doesn’t charge for it if the OEM doesn’t want to use it.
Also mentioned in CSR’s results release is the news that the low-power Wi-Fi chip that CSR announced in 2004, the UniFi 2, is finally shipping in phones: “our embedded Wi-Fi product will be shipping in six smart phones by the end of the current quarter.” Actually, one of their analyst presentations appears to indicate that it is already shipping in the Mio A702.
CSR says it is “the only ‘pure play’ connectivity company.” This is passably true, but each of the major cellular baseband companies except Freescale now has, or is in the process of putting together a suite of connectivity products. CSR also says it “is moving fast to create and lead this market.” It will have to move fast. Qualcomm has already swept multiple connectivity technologies into its latest cellular baseband offering. This is the likely end-game for all the cellular baseband vendors. The questions are: is this what the handset OEMs want, and if so, how long will it take?