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UK WiFi chip designer gets £20m funds, predicts success for 802.11g

By betting its future on the need for dual-standard WiFi and WiFi5 wireless components, Synad has attracted venture funding of £20m for its fabless semiconductor operation - and expects to see 802.11a, or WiFi5, move rapidly into the enterprise market.

The funding is designed to support commercialisation of Synad's Mercury5G, which CEO Mike Baker says will be the world's first two chip dual band wireless LAN solution. The money will see the company through the next 18 months of its life as its customers start shipping silicon.

Exactly who these customers are, Baker won't say for another couple of weeks; but the company is preparing joint announcements. He hinted that they would be in several market segments.

What seems to have attracted venture capital to this company is its bullish optimism about most wireless standards - not just the ordinary everyday WiFi 802.11b which most people are using today, but also the two go-faster standards -- 11g, which uses the same 2.4 GHz waveband, and 11a, which runs at 5 GHz.

Baker believes that each technology has its place.

"I think today's 802.11b technology will become the standard for public access," he said this weekend. "It has good range to cover larger areas. We expect 11a to become the standard for corporate LANs, because it's far more enterprise-centric; you get greatest density and no overlapping cells. And we're expecting 11g to be ratified early in 2003 and to move into domestic applications, because it won't have the range problems of 11b, but will have high data rates needed for video in the home."

The "hot-spot" market won't take off until suppliers get prices realistic, says Baker. "It will have to evolve a price point, as broadband did, until the market takes off," he suggested. "But people asking £80 a month are utterly unrealistic. When broadband costs £25 a month, any business model expecting to get substantial subscriber bases for that sort of money will fail."

Baker added: "This new technology access point is cheap. We've had people say to us, if you put an access point into a restaurant, and it costs £1,000 a year to put it in and so much to pay for broadband ... then those figures aren't significant. It gets lost in the noise of the turnover of that restaurant. I would say around £20 a month is the right figure."

The money took a little longer for Synad to raise than they were hoping. "The result is what counts," said Baker. "The market conditions aren't favourable, but we're very excited that UK company was able to bring in a small number of VCs. A lot of funding at the moment is done by a large number of VCs each putting a small amount in - but in our case, the round was led by Alta Partners in San Francisco, and Alta Berkeley of London. We came across them independently, and they aren't related any more. So we're pleased to have got a Silicon Valley investor who went for us, and a good spread of investors."

Synad's seed round investor Celtic House Investment Partners also played a major part in the deal. Two other new investors contributed to the round were NcoTec from London and Rendex Partners of Antwerp.

Synad's technology platform, AgileRF "delivers mobility and interoperability in wireless local area networks regardless of the standard employed."

In English, that means that it works at both 2.4 and 5 GHz frequencies simultaneously. This isn't so much of an issue for access point design, as it is for the chipset that will go into client machines - PDAs, notebook PCs, phones, and so on. There, people have been confused by the number of different wireless standards, and have been "holding off a decision," says Baker, "while they wait to see which standard dominates."

The one standard Synad doesn't cover, is Bluetooth - but that is probably more a question of retrofitting Bluetooth protocols to the existing physical layer, since it runs at the same 2.4 GHz frequency as WiFi and 11g.

The first product embodying AgileRF is Mercury5G, a two-chip CMOS solution designed to deliver seamless interoperability between IEEE 802.11a and IEEE 802.11b. The architecture also includes additional features and flexibility to support emerging standards such as IEEE 802.11g as they are ratified.

Further details from Synad's web site.