With its new, integrated chipset technology, Winbond Electronics Corp. promises to reduce the cost of fiber-based surveillance equipment by more than 30%, ushering in a new era of affordable fiber-based home security and automation.
The company demonstrated the technology last week at the International Surveillance Control Expo in Las Vegas, integrated into devices such as digital surveillance cameras, digital video recorders, LAN cameras, video phones, and home automation equipment.
Winbond hopes the new technology will not only be attractive to the surveillance and security market at the corporate level, but will also expand the market for the home, where such solutions become more affordable.
"The new availability of high-quality, lower-cost interoperable systems is a milestone for this industry, and Winbond`s integrated circuits provide a solution for making the equipment more affordable," said company vice chairman Ding-Yuan Yang, in a statement.
Yang added that Winbond has partnered with 3M Corp.`s Volition Network Solutions unit to incorporate more affordable cabling solutions such as 3M`s VF-45 fiber optic interconnect, which is designed to provide the ease of use and familiarity of copper connectors at a reduced cost.
Home security boom?
It remains to be seen, however, if Winbond`s more economically efficient technology will lead to a market boom in home security and automation. Connor Liu, an analyst at SG Securities Ltd. in Taipei, is skeptical that a cost reduction would cause any substantial increase in demand from homeowners.
"This new technology is focused on an extremely niche market, meaning the market size is limited," Liu cautioned.
With design innovations such as its video compression chip based on the ITU H.263 digital video compression standard, Winbond claims to have reduced the complexity and difficulty of designing and building digital surveillance systems. Winbond`s RISC-based embedded system is designed to simplify the equipment manufacturing process by reducing the need for multiple, complex integrated circuits. RISC integrates multiple modules, such as memory and CPU, onto a single chipset. Asian companies including Atop, Dynacolor, Fortuna, MacAlly, Radiantech, and UniSVR have adopted the system, according to Winbond, Hsinchu, Taiwan.
Winbond estimates the system will result in a manufacturing cost reduction of more than 30%. The company expects to pass on proportionate savings to end users within six months, which it expects will stimulate the home security and automation market.
"What`s happening today in the security market follows a recent shift to fiber-based networks in the local area network market," said Mike Lynch, strategic marketing manager at 3M.
According to Lynch, the lower-cost security solutions being developed by Winbond and 3M use the inherent bandwidth and security capabilities of fiber " to handle new digital demands" of highly secure networks at an affordable price to consumers.
The new chipset, part of Winbond`s effort to expand into non-DRAM businesses, won`t contribute immediately to solid sales and profits, SG Securities` Liu said. Winbond`s sales in the March quarter are expected to decline from NT$11.2 billion (U.S. $339 million) posted in the previous quarter, hurt by the steep price falls of 64Mbit DRAM, according to analysts.
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