Looking for the next killer application to fuel growth in the chip market is likely to be a search in vain, according to chip firm IDT.

The US company said that rather than a killer application, the industry now has a killer force, in the form of digital media, in particular video.

“Digital media is, in our opinion, driving growth in all the major segments of the semiconductor market,” said Phil Bourekas, v-p of marketing at IDT.

He said digital media is pushing growth in communications and networking with the distribution of video, in computing with media codecs and higher bandwidth I/O on PCs and servers, and in consumer with video mobiles, iPods and set-top boxes.

Phil Bourekas

“At this year’s Consumer Electronics Show, everything was geared around digital media,” said Bourekas. “Digital media is really the force,” he told Electronics Weekly.

IDT is so convinced of this, it has structured the whole company vision around digital media, with all its product lines and marketing geared to supporting customers in that field.

Bourekas reckons other firms have the same model, including industry giants such as Cisco, which recently bought set-top box maker Scientific Atlanta for $6.9bn, providing a handy link between the network and the delivery point for digital TV.

Meanwhile, Intel’s Viiv platform is focused on delivering digital media to consumer PCs, and Panasonic is putting Ethernet connections in its digital TVs.

Demands for bandwidth are also set to rise as high definition video requires around 10Mbit/s for each channel using the best encoding technology. Sending HDTV to, and around the home is widely thought to require significant investment in new technology.

As a semiconductor company, IDT has made some significant transformations over the past 12 months, including a merger with timing IC firm ICS and acquiring the timing products from Freescale.

These have allowed IDt to diversify away from its traditional communications base and into computing and consumer.

"We're no longer susceptible to the cycles of just one of the end markets that we services," Bourekas pointed out.

Commodity SRAM , which is where IDT started, is now just eight per cent of the firm's revenue, a number that is likely to reduce as the firm now does little or no R&D in that area.

www.idt.com