Broadcom's acquisition of NetLogic will enable it to more than double its addressable market, most significantly into the wireless infrastructure and base station markets, Scott McGregor, Broadcom’s President and CEO, said on an analyst call.
McGregor said that the combination of Broadcom's switching and routing platforms with NetLogic's knowledge based and digital front end would allow the company to address the concerns of network operators as they deal with rapid growth in demands on their networks.
"Network operators are struggling with the number of connected devices on the network and the exploding demand for bandwidth. The need to handle a wider variety of apps is forcing corporations and operators to use more and faster switches and increase intelligence by integrating more embedded processors. In the long term our goal is to combine the multicore front end NetLogic processors with BroadCom's platforms, to integrate higher bandwidth functionality and intelligence into one solution, with a lower integration cost, enhanced system performance and lower execution risk."
The company hopes that combining NetLogic's digital front end processors with other assets it has in the backhaul space, would allow it to play a broader role in the wireless infrastructure market. McGregor added that as DSP gets a bigger role in base stations as they evolve to LTE and beyond, the Broadcom-NetLogic combination would give it a "significant expansion of the addressable market in wireless infrastructure".
"BroadCom and NetLogic are currently used in many of the same platforms, and this proposed acquisition is an important next step to something truly unique in embedded processing - creating highly differentiated digital front end solutions for wireless base stations, and best-in-class integrated platforms for this segement" McGregor said.
Ron Jankov, NetLogic Microsystems President and CEO added that combining the "leading multicore, knowledge based and digital front end processors with Broadcom's tools, IP and ecosystem" would create, "a complete comms platform solution for customers' next generation designs. It will allow us to re-think the positioning of functionality on the platform, the design and footprint."
Broadcom's proposed $3.7 billion acquisition of NetLogic is due to close in the first half of 2012.