Atmel is expanding its capabilities in the growing Internet of things space with the acquisition of Newport Media, which makes wireless chip solutions.
Atmel is spending $140 million for Newport Media in an effort to bring greater wireless capabilities to its array of chips—including microcontrollers and memory—for such machines as cars and home appliances, which will be key parts of the Internet of things (IoT).
In a conference call July 7 with analysts and journalists, Atmel President and CEO Steve Laub said the acquisition of 9-year-old Newport Media will add Bluetooth and 802.11n wireless capabilities to the WiFi and ZigBee support already in its ARM-based SmartConnect wireless solutions.
"Atmel already has a strong position in IoT today," Laub said. "With [Newport Media], Atmel's [portfolio] will be complete."
Laub said he expects the deal to close in the third quarter. Newport Media generated $43 million in revenues in 2013, he said.
Atmel's acquisition of Newport Media is the latest move by a chip maker looking to position themselves for the IoT, a market that IDC analyst said will grow to $7.1 trillion by 2020. Other vendors also are growing their capabilities in this area. For example, Intel last year created a business unit dedicated to the Internet of things, and rolled out a new family of small, low-power chips called Quark that will be used in IoT and wearable devices environments.
In addition, it was work done by Qualcomm engineers that led to AllJoyn, an open framework for the IoT that is now being developed by the AllSeen Alliance vendor-led consortium under the auspices of the Linux Foundation.
The Internet of things envisions billions of connected devices and systems—from sensors and mobile devices to manufacturing systems, home appliances and cars—being connected and exchanging massive amounts of data. Cisco Systems is forecasting that as many as 50 billion devices will be connected by 2020, and Atmel's Laub said most of those connections will be via WiFi.
Atmel will combine its low-power microntrollers and Newport Media's solutions to offer a range of highly integrated wireless solutions that will take advantage of the growing demand for connectivity.