A Sad Day :-( “PMCS Announces Cost Reduction”

Most of the financial analysts are liking this move, but it comes with a human cost 😦

These were awesome design centers with great people. It is a sad day for me.

PMC-Sierra Announces Cost Reduction Initiative and Business Outlook Update for First Quarter 2007: Financial News – Yahoo! Finance:
Press Release Source: PMC-Sierra, Inc.

PMC-Sierra Announces Cost Reduction Initiative and Business Outlook Update for First Quarter 2007
Thursday March 29, 4:05 pm ET

SANTA CLARA, Calif.–(BUSINESS WIRE)–PMC-Sierra, Inc. (NASDAQ:PMCS – News), today announced that it is undertaking a corporate restructuring that the Company expects will reduce on-going annualized operating expenses by an estimated $20 to $24 million per year.


iInnovate Interviews | Philip Rosedale | Linden Labs | Networking Points

I’m really liking the iInnovate podcast site.

So far I’ve listened to Eric Schmidt, Andy Grove, and Philip Rosedale of Linden Labs the developers of Second Life.

I particularly liked Andy Grove’s question to Philip Rosedale (PR), which went something like, “What do you envision your needs for computing, client & server, networking, and software to be in 3-5 years time?”

Note that Second Life already has 4,000 Servers and the site is growing 10% per month.

Rosedale starts the answer with … we are only constrained by Moore’s Law. Our world gets better at this rate 😎

PR then gives a detailed answer which aligns very well with the Internet Stack diagram for the Internet. He is most concerned with client side appliance ( the PC) and the Servers, not so much with the network.

On the networking side, you know, broadband, symmetric high speed broadband connections, just continuing to get out there is really the biggest thing that we need. I’m probably least worried about that. We’ve got, you know, network speeds appear to be moving ahead.

Links: the clip of the Andy Grove’s Q the podcast the transcript

Chips/Semi Directions – Reaction to Drew Lanza in BWeek

tip to my friend Peter for forwarding Testosterone Chips: The End of an Era – Business Week – Drew Lanza to me this week.

This is yet another article that addresses what I call the “The Curse of Moore’s Law” and the possible new directions that the semiconductor industry could take.

From a VC point of view he nails the point that the cost of developing chips is getting higher ( he notes $20-$30M) and exit prices have not changed in a decade.

From a Comm Semi vendor point of view I would add that the end markets have not grown much in that time as well. Some areas have died and some new areas have emerged, but in the end it is not great when it costs more to play in the same size sand-box.

He notes that the possible opportunity is in Internet appliances where “smaller, cheaper, and low power” are king. I agree with this and have noted it in a previous post where I add that there may also be a great opportunity in developing chips to for “serving up applications” for these appliances. There is more to it than Intel and AMD CPUs. To support my point refer to Eric Schmidt’s comment in his recent podcast at iInnovate — “Google is a capital intensive business”.

The only gotcha that I see with this new direction is that chip development costs for appliances are also very high. For example, if one uses $20-$30M per chip development (mentioned in article) then the iPhone is leveraging ~$100M in chip development. The next stage of iPhone will be integrating the current devices into 1 or 2 chips. That will not be cheap and I’m guessing that this ~$100M pales in comparison to development cost of all the f/w and s/w the surrounds iPhone.

Heavy Rotation March -> Neil Young | Arcade Fire | Barenaked Ladies | Apples in Stereo

March was a fantastic month for music listening in hNorth-land 😀
Picking a favorite for the month has been very difficult. Arcade Fire’s – Neon Bible is fantastic and deserves to be #1. I really like tracks 2 – Keep the car running and 6 – Ocean of Noise. The new Apples in Stereo is just too much fun, track 4 Energy is great. It is my most played song this month. Barenaked Ladies single Michael Brennan is fun, too. Then there is the sentimental pick (tipped from Fred Wilson’s blog) of Neil Young’s – Live at Massey Hall 1971 (which I got yesterday and have not stopped playing since … wow!)

I also did some digging into the eMusic catalog to discover Elliott Smith and my old favorite Husker Du dude “Bob Mould”. The Shins and Bookashade continue to spin.

Here is my March Heavy Rotation List — Happy Spinning 🙂

Arcade Fire – Neon Bible Neil Young – Live at Massey Hall 1971
Apples In Stereo – New Magnetic Wonder Barenaked Ladies – Michael Brennan – Single
The Shins – Wincing The Night Away Bob Mould – Body of Song
Elliott Smith – Either/Or Booka Shade – Movements

weekly blog chat – Apple iTV | Eric Schmidt Interview | Vitesse & Semi Hell | FreeMind |

Chatting about blog-land this week. All of these are in my delicious widget on the right and @ http://del.icio.us/hNorth/blog. Spring Break definitely hit late this week.


Careers & Mgmt

  • not this week.


  • not this week.

General Interest ( Fun )

Vitesse | Andrew@Nyquist | Comm Semi Markets

I finally got around to reading Andrew’s review of VTSS’s 1Q07 call. I’ve always admired Vitesse for their ability to survive. Somehow they came out of the super-computer mess in the early ’90’s, but their current woes seem worse.

I’m a markets & positioning guy, and the first thing that leaps out at me is that VTSS is mostly in what I call the “middle”, and the “middle” is not good. To survive in comm semi, or semi at all, requires exposure to Data Center Equipment for hosting/serving applications ( ie Storage Computing ), Broadband Access Technologies ( xDSL, PON ), Wireless Access Technologies ( air-i/f or wireline back-haul), or consumer appliances. The rest is a “hell zone” 👿

I developed a simple model for visualizing the good Internet markets (Thinking About Network Diagrams.) The simple way to pick good Comms markets today is …. stay at the outer-most points of the Internet stack. The middle is dead.


The middle is dead because it has been very successful in providing for the proliferation of Applications ( ie Google, AMZN, Skype, etc) and Consumer Appliances (PC, iPod, etc). The IP Network provides an amazing Application platform, and we are only in the beginnings of an Internet Application bonanza. For applications and appliances to grow further, they don’t want the middle to change (they’ll work around its problems in the datacenter or appliance). I’m speculating that this is a key point behind Cisco’s recent acquisitions in the Application Layer.

And yes 😈 I purposely drew the Internet to like a giant LAN, PC, or any electronic device… to irritate & motivate. Each block is “fractal”, they are all fundamentally the same. So there are good & bad bits in each block. I’ll get to this later.