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Interview with Chaintech

November 21, 2000



<Q>: Could you introduce yourself first, please? What is your position in CHAINTECH?

<A>: My name is Ron Carlson and my title is marketing supervisor, but in addition to marketing work I also do a lot of product manager work.

<Q>: How will the average mainboard in H1'2001 look?

<A>: Because OEM and bare bones make up most of the market, the average motherboard will continue to be a uATX motherboard with embedded functions like on-board audio, VGA, etc. In the distribution segment, because Intel continues to dominate CPU production and performance, an average motherboard will continue to be a ATX Socket 370 model. In Q1 DDR will become a market reality, but probably won't take more than 10% orders in Q1. Q2 will be the real test of DDR's market potential.

The only real questions vis-a-vis DDR are:

  • Will the chipsets actually deliver the performance promised?
  • Will the chipset vendors be able to deliver stable product in volume?
  • Will memory manufacturers be able to deliver volume quantities?

Chaintech's DDR product line is really strong. Our 6VJD2 is designed to provide an easy PC133 to DDR migration because has both DIMM and DDR slots, so users can continue using the legacy memory they've invested so much money in. Our 6VJD is a pure DDR solution and I'm really excited to see how this model performs.

Also, we'll soon have IronGate4 motherboards on offer, so once again I hope our friends at Digit-Life have time to test these for us.

Rambus - They've promised the world, but definitely haven't delivered. However, RDRAM costs should come down significantly over the next two months. If prices do come down, then we must look closely at

  1. whether or not Intel's chipset delivers the performance people want, and
  2. whether or not the our customers are still interested.

Chaintech hasn't had much success in the market with motherboards that use Rambus. Naturally, we're quite interested in new developments however.

<Q>: What will happen on CPU/chipset market in 2001?

<A>: Well, look for more of everything - more USB ports (minimum 4, maximum 8), ATA-100 support, FireWire at the high end and, I hope, much better on-board VGA. Mobos with on-board video have been, at least in terms of performance, disappointing to people buying in the distribution channel (i.e. PC professionals) and those people make buying decisions for just about everyone else.

I'm excited about the potential of our 7AIV4 model, which features on-board Savage4 graphics as well as C-Media PCI audio. This is another model I hope Digit-Life has time to test.

USB 2.0 is an exciting idea, but this another area where promises are many but products are few. FireWire is showing increasing strength in professional markets, but most users don't know what it is or does. Everyone knows USB. But, everyone also knows that "new" technologies invariably have problems. It's taken almost five years for DVD to become truly commonplace. With Intel behind it and the current success of USB 1.2, USB 2.0 will be widely available - it's only a question of when (i.e. how much trouble will it be to implement and use?).

Fundamentally, VIA, SiS and ALi are in the same position Intel was last year at this time. Everyone knows Intel had problems executing its next generation memory standard strategy. Now, the others have their chance. It's simply a matter of execution.

Personally, I feel the marketplace is ready for DDR and nearly all vendors - from motherboard makers to memory manufacturers - are reading from the same page. So, unless something really horrible happens, DDR will succeed.

<Q>: You were preparing the mainboard for Timna. What do you think now, when Intel has cancelled this project?

<A>: Intel was very forthcoming about Timna. They felt it was a good product, but the marketplace would have passed it by. Therefore, the market opportunity they previously saw would have disappeared by the time Timna hit the streets. Chaintech is of course offering 810E and 810E2, as well cost down 815EP solutions. These products have been and we feel will continue to be quite popular.

In fact, Chaintech will soon deliver 815 solutions with V-Core tuning (i.e. 6OJV3, 6OJA3, etc.). These should be very popular.

<Q>: Could you please comment Intel's decision not to release Almador chipset?

<A>: I really don't have an opinion on this. Also, there hasn't been much discussion about it here.

<Q>: A lot of companies started to produce information appliances. Which way do you think is better: "crippled" PC from VIA or a special device with a special architecture and CPU (for example, Crusoe)?

<A>: I disagree with your characterization of VIA's solution as crippled. IA is a different market with different needs. The current generation of Internet appliances coming out now is much better than previous attempts. In general, I feel proprietary, specially engineered products are the wrong approach.

It's simply a matter of who can deliver a sub-$500 device with the performance, features and reliability people are hungry for. I think Chaintech is that company and we announced a whole range of IA at COMDEX, including set top boxes, Windows-based terminals and cost-down bare bones style systems. Increasingly, people are looking for ways to reduce deployment costs and reduce system maintenance over the long term. We have products that do that right now.

<Q>: Please, tell us about the company's results in the last quarter. Any forecasts?

<A>: Like almost everyone else July and August were less than spectacular. However, September was a very good month for us. Whereas Asus and others had a very bad month, we did quite well - both volume and revenues increased a lot. We've been working very hard to improve our service (i.e. for distribution) and have spent a lot time/money courting OEM buyers. These efforts are really starting to pay off.

<Q>: What do you think about the future of Crusoe CPU and mobile processors from AMD?

<A>: Competition is good and Intel had become somewhat complacent in the portable market segment. Personally, I love my (Apple) PowerBook and will probably buy a new one soon.

<Q>: Can we expect an integrated Bluetooth controller in CHAINTECH's mainboards?

<A>: Bluetooth is another technology that has been long on promise, but short on delivery. The need is there and the marketplace seems to be begging for a truly robust and easy to implement wireless networking standard. Wireless

Ethernet is clearly not the answer and wireless FireWire solutions look nice, but aren't available. I don't see Bluetooth arriving on the motherboard any time soon. Specialty solutions, like a custom uATX motherboard for OEM is more likely I think.

Again, if the silicon is ready and people want it, we will make it.

<Q>: Intel is going to release P4 processor and in a quarter will change its form-factor (0.13 micron Northwood). What do you think of it? What does CHAINTECH plan for P4?

<A>: Motherboards that use Intel CPUs account the majority of our sales. In general, we are quite satisfied with Intel's efforts in terms of CPUs and there are lot of different chipsets that support Intel CPUs. Initially, P4 solutions will be clustered at the high-end (i.e. servers and workstations). Our products tend to be more mainstream, so we will have more time to evaluate the P4's mass market potential.

I have seen that some tier one vendors will likely wait until Intel can offer a 0.13-micron version before supporting P4.

Intel has said the P4, or some iteration thereof, will hit the mainstream either late in Q2 or in the second half of '01. I know our engineers are working closely with Intel in this area. We were working on an Almador reference board, so upcoming P4 chipset motherboards will be a priority for us.

<Q>: What do you think about NVIDIA (Crush) and ATI (ArtX2) future integrated chipsets? What about price/performance balance of these solutions? Will these announcements change market shares of other chipset companies?

<A>: Creating an integrated VGA/mobo chipset solution is tricky work and, to present, only certain market segments are buying such products. However, the potential of a truly powerful integrated solution is too good to ignore.

Whoever creates a chipset that can pump out 60fps in Doom, Tomb Raider, etc. will be the winner. If you get the kids to buy it, everyone will take notice.

In terms of hardware, announcements don't mean anything - products are what really matter. In the hardware segment no single company is powerful enough to corner the marketplace by simply announcing their intention to create a product. Also, people are quite skeptical of the sometimes incredible claims hardware companies make. If we didn't learn this lesson before, Rambus certainly made everyone skeptical of words like "new," "next generation" and "revolutionary."

Actually, I've been quite surprised that integrated solutions haven't made more of an impact in the portable market. It just seems like such a natural progression to me.

<Q>: Will CHAINTECH release STMicroelectronics KYRO chip based graphics card? What do you think about this chip?

<A>: I haven't heard anything about this, but that doesn't mean it won't happen.

Everything I've read about Kyro sounds good, but the execution (stable silicon, volume delivery, low-cost) is what really matters.

<Q>: 3dfx announced that they would provide Rampage chip for graphics cards makers. Is it possible that CHAINTECH will produce cards based on 3dfx's future chips?

<A>: Chaintech currently has a very good and very close relationship with nVIDIA. I can't imagine we'd risk harming that relationship.

<Q>: What is your forecast for the graphics chips (cards) market in 2001? Will NV20 and NV17 from NVIDIA be the leaders or anybody will be able to compete with NVIDIA?

<A>: The graphics card market is incredibly volatile and is highly segmented. Who could have imagined last year at this time that 3dfx would be having so many problems now?

Also, nVIDIA has been very, very successful in the distribution market. It does not necessarily translate that they will be equally successful in the OEM market, in which ATI still is the one to catch.

Personally, I think nVIDIA has about a four to six month lead on the others. However, this could change much like it has changed in the past. ATI then S3 then 3dfx and now nVidia. Who will be the king in six months? I'm pretty sure it will be nVIDIA and Chaintech is beating heavily that it will be nVIDIA.

<Q>: NV20 won't appear this year. Do you think it is a good solution to move the release to Febraury-March'2001?

<A>: Waiting to produce a solid product is almost always the best course of action. nVIDIA has shown a lot of market and product savy over the last 18 months, so they have probably made the right choice.

Remember the 820 chipset? The guy who decided to push that product out too soon doesn't work for Intel anymore. He probably has a new job, but probably doesn't make as much money. The guy or gal who decided to hold the NV20 is probably feeling a lot of stress and may not get that performance bonus because of the delay, but he/she still has a job.

<Q>: Please, tell us about the CHAINTECH's graphics cards based on NVIDIA chipsets in 2001 (High-End, Mainsream, Low-End).

<A>: I know we will soon release Pro and Ultra versions of our GTS cards. And, because I'd like to keep my job, I really can't comment on future products. However, if you look at our product line now, you can see that we make cards based on just about every chipset nVidia offers. So...

Also, look for more VIA/S3 integrated solutions, like the 7AIV4, from Chaintech.

<Q>: Thank you very much for your answers!

<A>: You are very welcome. And, look for more really cool products from Chaintech very, very soon.


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