What They Say
Valens Semiconductor, a fabless chip company that is behind the HDBaseT technology, is listing on the NYSE today using a SPAC, the PTK Acquisition Corp. The move valued Valens at $1.1 billion and will produce $155 million of gross proceeds. (Valens Goes for IPO via SPAC)
What We Think
I have been writing about and meeting with Valens since 2010. At the time, I said
“On the face of it, this specification looks very appealing, with low cost cables and connectors. However, often, the success of particular standards is in the interoperability and in the details, so we’ll reserve judgement for now.”
At ISE in 2012, I gave a talk that highlighted the potential of the idea for the firm. However, by November 2013, I was writing an editorial (entitled “HDBaseT: A Standard-Lite Standard”) that highlighted the problems that the firm’s technology and customers were having with interoperability. Getting multiple devices from different vendors to work together was not trivial and installers were telling me the technology was really not delivering. One of the problems for Valens was that it had hoped to get a big CE company to adopt the technology to work in ‘two box’ TVs, for which it was a potentially good solution. However, it didn’t win any big clients, so it had to focus on the AV market. That meant much lower volumes and an ‘open’ market of different devices. Lower volumes meant a much higher chip price, which reduced the potential volume. That meant less revenue for the testing and development infrastructure needed to develop such an open market.
That the company survived this crunch is testament to its intent. Eventually, the firm managed to get testing and certification sorted although at CES 2014, it was still only ‘a hope’ that certification would be mandatory.
Now, HDBaseT is ubiquitous and the firm has been pushing other applications. In our report from the Nuremberg 2015 Electronic Display event we reported that the firm was aiming at industrial PCs and had developed a single UTP version of the technology for automotive applications. (16 Valens Pushes HDBaseT into Industrial PCs – Autos Next?). These days with the adoption of the firm’s technology adopted as the baseline for the MIPI A-PHY standard, the firm is described as ‘an automotive specialist’. Reports earlier put the firm’s revenue at just $8m from automotive against $67 million overall, but this is expected to grow to 50% of its revenue with business from firms including Daimler as we reported in 2016 (Cars, Yes; Display Technology, Not So Much). (BR)
