The Philips Semiconductors arm of Philips Electronics NV – formerly Signetics Inc – is plunging into the multimedia chips business with two initiatives. It is to buy the Multimedia Products Unit of Western Digital Corp, Irvine, California on undisclosed terms. The Sunnyvale, California company has also formed a joint venture with Spea Software AG, Starnberg, Germany to design three-dimensional multimedia chips. The new SP3D Chip Design GmbH will be owned 50.5% by Philips – the deal is effectively Spea off-loading one of its businesses to Philips because at the core of this new company will be a team of experienced graphic engineers that previously formed part of an independent division of Spea. The joint venture’s first product, a three-dimensional accelerator, will initially be produced using Philips’ 0.5 micron CMOS process but will be shrunk later to 0.35 micron. Samples are set for January. Under the agreement with Western Digital, Philips will acquire all the assets of the Multimedia Products Unit, which include the Paradise graphics accelerator boards and the RocketCHIP family of accelerators. The move marks a further contraction of Western Digital down to what has become its core business, that of making hard disk drives.
