Frontier Silicon is a UK-based fabless manufacturer of semiconductors for digital TV/radio and consumer multimedia products including digital audio broadcasting (DAB) modules, digital video broadcasting (DVB)-T solutions and the underlying SoC devices. The company recently established its first overseas operation, Frontier Silicon (HK) Ltd, and opened a new sales and technical support operation in Shenzhen, China. Anthony Sethill, CEO of Frontier Silicon, talks to NE Asia about how DAB technology will affect the local Asian consumer electronics manufacturers.

Made in Asia

There are two aspects to our business: the first is the development of the core technologies which we do in Europe; the second is the consumption of our technologies. The markets currently for digital TV and digital radio technologies are in Europe. Asia is the factory for our technologies. About 95% of our customers are based in Asia, specifically in Japan, Korea, China, Hong Kong and Taiwan. So Asia is absolutely key to our business. Our customer base, if you look at Japan, includes all tier one consumer electronics manufacturers such as Sharp, Denon and Sanyo.

Our products are manufactured in Asia. For example, the core of our technologies is the key system chip for digital radio and digital TV with TSMC as foundry partner. For our digital TV chips we also have Samsung Semiconductor in Korea as our manufacturing partner. What is different about our business is that most chip companies sell chips; we sell the turnkey solution of the chip, software and the module.
DAB, DVB

We focus on two main areas: DAB, and DVB. DAB is based on the European standard Eureka 147. We are still the first and only company in the world to have a single-chip solution for DAB. We call it Chorus. It went into production in mid-2002. I'd say this chip has been instrumental in enabling the growth of digital radio during the last few years.

With our chip and solution approach, we work with Hong Kong audio manufacturers on the �’99 digital radio. So this has enabled the market to develop. Retailers have become more enthusiastic, and now the UK is the powerhouse in driving consumption of digital radio. By December of 2002, we had shipped half a million modules. I expect we will be targeting to ship one million this year. The main consumption has been in the UK, but the standard DAB has now been expanded across all of Europe, Canada, Korea, Taiwan, Singapore and parts of China.

Creating New Opportunity

What does this mean to the Hong Kong economy? The market for products which contain radios in Europe is annually 15 million units. Last year, the export value of DAB to Europe from China and Hong Kong was about US$50 million. And over the next 3 to 5 years, this could easily grow 10 fold to about US$500 million. Consumer electronics manufacturers will see the benefits of that. They will be generating a new market opportunity.

The main production side for DVB products has been in Europe. The industry in Hong Kong and China now sees a big opportunity for building and exporting digital TV technology to Europe. The average margin for a manufacturer of consumer electronics is very small and tight. Adopting new technologies is a way of enhancing their own businesses.

Technical Support in China


The key to promoting our technologies in China is technical support. One of the key objectives with our operation in China is to improve the training of engineers. We currently have 12 technical engineers. My plan is for our operation in China to exceed 50 people within three years.

The long-term goal for our company is to develop into a technologist, focusing on multimedia technologies. We'll further develop a new standard in mobile phones called DVBH; and very important to our business will be the technologies for flat panel TVs. Last year, we turned out US$25 million in revenues and expect that to double this year. In five years we aim to exceed US$500 million per year.

compiled by Eleanor Yeung

(June 2004 Issue, Nikkei Electronics Asia)

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