CYPRESS SEMICONDUCTOR CORPORATIONcsinvesting.org/.../05/download_t_j...presentation.pdf · PC...

09_24_02_TJR_CDC PRES

COMMUNICATIONS DESIGN CONFERENCESEPTEMBER 24, 2002

T.J. RODGERSPRESIDENT & CEO

CYPRESSSEMICONDUCTOR

CORPORATION

09_24_02_TJR_CDC PRESMORGAN STANLEY

Tech Spending Has Risen Rapidly and Has Tech Spending Has Risen Rapidly and Has Tech Spending Has Risen Rapidly and Has Tech Spending Has Risen Rapidly and Has Been Above Trend lineBeen Above Trend lineBeen Above Trend lineBeen Above Trend line

U.S.-based Information Technology % of Nominal Business Capital Equipment Spending

0

10

20

30

40

50

60

1960

1962

1965

1967

1970

1972

1975

1977

1980

1982

1985

1987

1990

1992

1995

1997

2000

Jan ‘80PC Introduction

Jun ‘95Commercial Internet

(%)

28%

42%

52%

Source: Morgan Stanley Internet Research; Bureau of Economic Analysis; Data as of 05/03/01

49%

Mar ‘01Current

Trendline


$0$250$500$750

$1,000$1,250$1,500$1,750$2,000

2001 2002 2003 2004 2005

LOCAL, LONG DISTANCE & INTERNATIONAL TELEPHONY

MOBILE TELEPHONY

+ 4%

+ 6%

>50%

CURRENT DATA SERVICES

EMERGING SERVICES

COMMUNICATIONS SERVICES REVENUE$ BILLIONS

+16%

+ 10-12%

Source: Dataquest - May 2001

WW INTERNET SUBSCRIBERSMILLIONS 605

404 550 650480330

2000 2001 2002 2003 2004 2005

DATACOM GROWTH

Source: Cahners In-Stat - June 2001

WW BROADBAND SUBSCRIBERSMILLIONS 68

2252

84

35122000 2001 2002 2003 2004 2005

WW WIRELESS PENETRATION %

Source: Yankee Group - June 2001

18%13% 16% 20%

15%10%

2000 2001 2002 2003 2004 2005

Source: McKinsey & JP Morgan - May 2001

US BACKBONE TRAFFIC EXABYTES (1018)

1.7 2.4 3.7 5.9 9.213.8

2000 2001 2002 2003 2004 2005


CYPRESS SHARE PRICE

$0$5

$10$15$20$25$30$35$40$45$50$55$60

Q198 Q398 Q199 Q399 Q100 Q300 Q101 Q301 Q102 Q302QTD

LUCENT $1.00NORTEL $0.70JDSU $1.90VITESSE $1.00

$14.75$7.24$7.24


SUSTAINABLE LEVEL

%SALES

0%

20%

40%

60%

80%

100%

120%

140%

160%

1996 1997 1998 1999 2000 2001 2002

SERVICE PROVIDER CAP-EX

CLECs

NEXT GEN LONG HAUL

US WIRELESS

RBOCs/NAR NATIONALS PTTs


WHY COMMUNICATIONS?

"The worst is yet to come," wrote telecom analyst Scott Cleland of the Precursor Group of Washington, D.C., in a research report last month. Cleland predicted that a number of telecom firms could face insolvency during the next two years, ranging from equipment-maker Nortel Networks to Santa Clara DSL provider Covad Communications.

Recession slams telecoms hard. Layoffs, bankruptcies aboundTodd Wallack, Chronicle Staff Writer

Posted on Tue, Jul. 23, 2002

Lucent posts 9th straight quarterly loss, cuts more jobsMURRAY HILL, N.J. (Reuters) - Telecommunications equipment maker Lucent Technologies Inc. Tuesday posted its ninth consecutive quarterly net loss and said it would have to cut another 7,000 jobs because the telecom spending slowdown has not relented…


SOURCE: WSTS, GARTNER, ISUPPLI 6/02

SEMICONDUCTOR SUPPLY & DEMAND

40

50

60

70

80

90

100

95Q1 96Q1 97Q1 98Q1 99Q1 00Q1 01Q1 02Q1800

900

1000

1100

1200

1300

1400

FAB UTILIZATION %

DEMAND: BU

CAPACITY: BU


CUSTOMER INVENTORY

0

10

20

30

40

50

60

70

80

90

100

110

97Q3 98Q2 99Q1 99Q4 00Q3 01Q2 02Q1SOURCE: WIT SOUNDVIEW 5/02

DAYS COMM

DISTICM

WIRELESSAVG


“Near-death experience forces collaboration.”

—Dave AyersOfficer, Supply Chain Engineering

Lucent


2.52.52.6

3.9

5.9

8

3.43.1

4.7

7.4

2

0123456789

Q2 2001 Q3 2001 Q4 2001 Q1 2002 Q2 2002 Q3 2002

Final Actuals Excluding Write Downs New Forecast

EXCESS SEMICONDUCTOR INVENTORY FORECAST

CONSUMPTION OF EXCESS INVENTORY HAS SLOWED AND WRITE-OFFS HAVE INCREASED…


WHERE ARE WE IN THE CYCLE?

OVER-INVENTORY

OVER-BUILD

CAPACITY BUYS

TECHNOLOGY BUYS



OVER-INVENTORY

OVER-BUILD UNDER-UTILIZATION

CAPACITY BUYS FREEZE

TECHNOLOGY BUYS



OVER-INVENTORY

OVER-BUILD UNDER-UTILIZATION

CAPACITY BUYS FREEZE CAPACITY BUYS

TECHNOLOGY BUYS TECHNOLOGY BUYS


HISTORY LESSON: THE RAILROAD BUBBLE

IN BRITAIN: 1850: 6,084 MILES OF TRACK WHEN BUBBLE BURST1910: 21,000 MILES OF TRACK

IN US:1860: 30,000 MILES OF TRACK WHEN BUBBLE BURST1900: 500,000 MILES OF TRACK

Source: P.J. C. Ransom in I. McNeil, A. FishlowData courtesy of Brian Arthur


Product Partnering• Design collaboration• Supply chain collaboration• Full stream cost reduction

Portfolio Planning• Market trend review• Technology roadmap definition• Joint portfolio planning

Design Review• Supplier partnership workshops• Product high level definition• Product level cost reduction

Commodity Sourcing• Security of supply• Quality of components• Component level cost reduction

Supplier Partnership Evolution

Lucent Priority - Do not Distribute


Corporate Presentation

Characteristics of Good Supply Chain Management

� Price is Not the Only Thing that Matters� Performance Criteria used to Determine Splits� Appropriate Payment Terms� Liability Management� Respond to Suppliers Needs� Allow Suppliers to Create Value

� Supply Chain Integration� Logistics Management

Michael Marks: Keynote Speaker -- First Annual Supply Network Conference, San Jose, California, September 2002


THE ELECTRONICS FOOD CHAINSILICON WAFER IC “CHIPS” BOARDS SYSTEMS

EQUIPMENTPROCESS

DESIGNTEST

RELIABILITYBOARD DESIGN

SYSTEM INTEGRATIONSOFTWARE

CUSTOMERAMT CY CY CY SYSCO SYSCO SYSCOSYSCO


Corporate Presentation

EMS becoming Design Driven� Engaging earlier in the product life cycle� OEM Divestitures will continue� Opportunity to engage with customers earlier in the design cycleTypical Design Cycle

Idea/Concept Architecture DesignPrototype/

Industrialization Production

Traditional EMS

Entry Point

PC, Cell Phone

Customer

ConsumerIT/Communications Infrastructure

Handhelds

Office Automation

Digital Imaging/DisplaysAutomotive

Medical/Industrial

Semi/Customer

New EMS

Entry Point


CYPRESS TRANSFORMATION

2000 ONWARDS

MARKET FOCUSEDSUPPORTTING MARKETS (WIRELESS, SAN, WAN)

1992-1999

PRODUCT/MANUFACTURING FOCUSEDBUILDING PRODUCT LINES (MANY CYPRESSES)

1983-1992

TECHNOLOGY FOCUSEDHIGH SPEED CMOS (“INTEL DELIVERS”)


MPDMEMORY

PROD

DCDDATACOM

PROD

PCDPERSONAL

COMM

TTDTIMINGPROD

ISDANCHOR

SCANLOGIC

STRATEGIC ACQUISITIONSCMS

CYPRESSMICRO

PSoC

SLMSILICON LIGHT

OPTICSO/E CONV

MoBL

ASYNC

DUAL PORTFIFOPHY

CPLD

ROBOCLOCKZERO DELAY

PROG CLOCKPC CLOCK

USBECHELON

GALVANTECH

SYNC

WANSAN

PCCNSMR

WITWIN

LARA NET

NET SRCH ENGCO PROCESSOR

IMI

ComLQUAD PORT

HIBAND

FRAMER

ARCUS

EMI BUFFER

IC WORKS

BLUETOOTH

RADIOCOMALATION

MOTOROLA 7%CISCO 6%NORTEL 4%LUCENT 3%

EMC 1%IBM 1%COMPAQ 1%

MOTOROLA 7%NEC 5%INTEL 3%ERICSSON 2%


STANDARDS BODIES


MANUFACTURING COOPERATION

PROBLEM: TIME TO MARKET

SOLUTION: AUTOLINE, ASSY & TEST TIME 8 HRS

BENEFIT: FAST RAMP FOR MOBILE MARKET


CONSULTANTS PROGRAM

122 CONSULTANTS APPROVED:PSoC = 100USB = 22

CERTIFICATION & TRAINING PROCESSCOLLABORATIVE WEBSITE LIVEIP PROCESS IN DEFINITION


CDC BOOTH PARTNER


CDC BOOTH PARTNERITALTEL FLEXBENCH


SOLUTION

PROBLEM: TIME TO MARKET


FLASHProgramMemory

SRAM

8-BitMicrocontroller

AnalogSoCblocs

DigitalSoCblocs

General PurposeI/O

Internal I/O Bus

ProgrammableInterconnect

32 KHz CrystalOscillator

InterruptController

TemperatureSensor

Brown-outDetection

Power-on-ResetControl

Precision OscillatorandPLL

SleepTimer

Watch DogTimer

Internal 32 KHzOscillator

VoltageReference

Addr/Data

Addr/Data

Internal Address/Data B

us

X1

X2

Pin by Pin ConfigurableI/O Transceivers

Total I/O Pin CountVaries by Device

SoCblocs

MACMultiply / Accumulate

Inte

rnal

Add

ress

/Dat

a Bu

s Decimator

Core

M8C


SONOS DEVICE

N+ N+

POLY+++

SiO2 40 ÅSiNxOy 80 ÅSiO2 18 Å

+++++++

POLYIsolated P-Well


PSoC DIE


ANALOG CAPABILITY

Delta-Sigma A/D convertersSuccessive Approximation

A/D convertersIncremental A/D convertersProgrammable gain/loss stageAnalog comparatorsZero-crossing detectorsFiltersAmplitude modulators, Amplitude demodulators

Sine-wave generatorsSine-wave detectorsSideband detectionSideband strippingFrequency modulationFrequency demodulation Audio coding, audio decoding, Audio output drive Audio compress/expansion


PSoC Designer™De

vice E

ditor

Confi

gurat

ion

Debu

gger

Appli

catio

n Buil

der

Comp

iler

Simula

tor

Devic

e Prog

ramme

r

Integrated Development Environment

In-Circuit Emulator


WHY CHOOSE PSoC? PARTS REDUCTION

90+ Parts 20+ Parts$2.00


SINGLE ORMULTI-PORT

MEMORY+LOGIC

SINGLE ORMULTI-PORT

MEMORY+LOGIC

CUSTOMER ISSUESBANDWIDTHLATENCYDENSITYAVAILABILITYBIT COST

NETWORKPROCESSOR

ASIC

PORT 1

PORT 2

PORT 3

PORT 4

PORT X

PORT 1

PORT 2

PORT 3

PORT Y

PORT 4

MEMORIES IN SWITCHES

READW

RITE


18 M NoBL RAM


PROBLEM: MAKE IT GO FASTER

PARTNER: CISCO

QDRQDR

CUSTOMER ISSUESBANDWIDTHLATENCYDENSITYAVAILABILITYBIT COST

NETWORKPROCESSOR

ASIC

PORT 1

PORT 2

PORT 3

PORT 4

PORT X

PORT 1

PORT 2

PORT 3

PORT Y

PORT 4

READWRITE

PORT 1 PORT 2DDR DDR

QUAD DATA RATE (QDR)


QDR, 6 Gbps


NINE MEGABIT DUAL-PORT RAMs

CYPRESS IDT


SYSTEMA

QUADPORT MEMORY

SYSTEMB

SYSTEMD

SYSTEMC

QUADPORT

X18

X18X18

X18


PROBLEM: FAST SWITCHING WITH DATA BUFFERING

PARTNER: EMC

SWITC

HCY

QUADPORT

CYQUADPORT

CYQUADPORT

CYQUADPORT

PRO

CESSO

R

SERDESHOTLINK2

PHYSW

ITCHSER

DES

SERDES HOTLINK2

PHY

SERDES HOTLINK2

PHY

SERDESHOTLINK2

PHY

RAID DIRECTOR CARDTEST MODESJTAGLATENCY


QUADPORT: PACKET MANIPULATION

PORT 4

PORT 2

PORT 1

NET PROCESSOR

x18 x18

X18

QUAD PORT

PACKET

X18

PORT 3


QUAD-PORT, 9.6 GBPS

BIGGEST,

FASTEST

IN THE WORLD


OC-48 FRAME = 16X STS3 = 48X STS 1

SON

ET OVER

HEA

D

GE#1 Waste

PROBLEM: INEFFICIENCY OF ETHERNET OVER SONET


OC-48 FRAME = 16X STS3 = 48X STS 1

SON

ET OVER

HEA

D

GE#1FE#2

GE #3FE#4

UP TO#16

PARTNER: NORTEL

SOLUTION: VIRTUAL CONCATENATION(DYNAMIC BANDWIDTH ALLOCATION)


GigabitEthernet

FCESCON

DVBSMPTE

OC-48 Frame

GbE FC DVBF

E

OC48

GbE

FC

DVB

FE

GFP Enables VC Enables

PARTNERS: NORTEL, CISCO, RIVERSTONE

PROBLEM: TOO MANY PROTOCOLS


POSIC2GVC

16 CHANNELSDYNAMIC ALLOCATIONGE OVER SONETFC OVER SONETESCON OVER SONET


CYNSE70128SEARCH

ENGINE(S)

7C1352SYNC

SRAM(S)

CYNCP80192COPROCESSOR

NETWORKPROCESSOR

VITESSE IQ2000

111

000010011111

ABCD

D = 101

101

111

NETWORK SEARCH ENGINEPROBLEM: PACKET FORWARDING AT OC-192 SPEED

PARTNER: CISCO


256K NSE

9.4 MEG = 256K x 36

467 Kmil2


CYPRESS OC-48 / STM-16 LINECARD


OC-48 SYSTEM

SOLUTION

FUNCTIONS – 2 X GIGE BACKPLANE– LAYER 3 CLASS– LAYER 4 CLASS– OC-48 PORT

ALL CYPRESS SILICON – DCD (POSICTM FRAMER, OC-48 PHY, HOTLINK IITM PHY,

QUADPORTTM DSE, DELTA39KTM CPLD)– MPD (NOBLTM SRAM)– TTD (ROBOCLOCK IITM CLOCK DRIVER)– PCD (USB FX-2)– CMS (PSOCTM)


CYPRESS TEXAS DGE WAFER

09_24_02_TJR_CDC PRES Cypress Semiconductor & Silicon Light Machines Confidential 4

Grating Light Valve� TechnologySpatial Light Modulation Based on Diffraction

Specular State – No Bias Diffraction State – Bias Applied

Fixed Ribbon

Moving Ribbon(bias voltage applied)

Air Gap

Common Electrode(Ground Plane)

IncidentLight

DiffractedLight+1 Order

Diffracted

Light

-1 Order

IncidentLight Reflected

Light


PROBLEM: NON-EQUAL SIGNALS IN DWDM SYSTEM

PARTNER: LUCENT, CIENA

Before Equalization

0.E+00

1.E -04

2.E -04

3.E -04

4.E -04

5.E -04

6.E -04

1546 1547 1548 1549 1550 1551

W a ve le ngth (nm )

Out

put P

ower

(W)

After Equalization

0.0E+00

5.0E-05

1.0E-04

1.5E-04

2.0E-04

1546 1547 1548 1549 1550 1551

Wav e le ngth (nm)

Out

put P

ower

(W)

Equalizes DWDM Channels50 GHz Channel Spacing

5.6 dB

<0.1 dB


SLM 2200 Dynamic Gain EqualizerPrinciple of Operation

DGEDGEDGEDGE

GLV Device

��1, ��2, ��3, … ��N

ControlSignal

EDFA

Static Grating


FROM NOW ON: IT WON’T EVEN TAKE A NEAR-DEATH EXPERIENCE TO WORK TOGETHER

SYSTEM MAKERSILICON SUPPLIER

THE PARTNERSHIP DEAL

YOUR IP IN SILICONMOORE’S LAW: COST, INTEGRATIONPRODUCT YOU WANTED/KNOWSTABLE SUPPLYHIGHER MULTIPLES

“FREE” IP & DEBUGHIGHER VALUE PRODUCTSDESIGN WINSSTEADY BUSINESSHIGHER MULTIPLES

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