The ‘Bell Swoosh’ will determine the pattern of the semiconductor industry recovery, according to Dave Bell, CEO of Intersil in a talk to the Globalpress Summit Conference in Santa Cruz today.
"We are emerging from a very painful downturn," Bell told the conference, "but we are emerging stronger than before."
Bell pointed out that 19 out of the biggest 20 purchasers of semiconductors predict that they will increase spending on chips in 2010. Collectively the top 20 will spend $104bn this year.
That is one reason why, for the next 12 to 18 months, Bell predicted that the industry will experience the ‘Bell Swoosh’.
The Swoosh scenario anticipates very rapid growth between now and the end of 2011, and thereafter a return to normal analogue industry growth rates of 7-8%.
Part of the scale of the current growth can be attributed to the dire state the industry reached in the depths of the downturn. "Intersil had nearly zero bookings in December 2008", said Bell.
Bell is transforming Intersil into a broadline analogue supplier and has made six acquisitions in the last 24 months. "I am the first person for 25 years who has tried to build a broadline analogue company", said Bell. The last person who set out to do that was Jack Gifford of Maxim in the mid-1980s
The transformation is happening fast: "We’ve been adding a new product line every quarter for the last two years," he said.
A major focus is on ICs which improve the wireless video experience. "Video is exploding. It’s changing the world", said Bell, "YouTube is the world’s on-line TV station. The average viewer spends 12.2 hours a month watching video, and the average length of a video has increased to four minutes. The iPhone has practically brought AT&T’s network to its knees with a 5000 times increase in traffic since 2006."
In New York, for instance, the cell network is saturated, said Bell, making it very difficult to get a connection and, having got one, to not have it dropped.
Intersil acquisitions like Quellan and Techwell focus on products which improve video quality.
When Intersil had revenues of $118m, Bell predicted it would have $1bn revenues by the end of 2011 with gross margins of 58%. "Now I predict we’ll get there earlier," said Bell.