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60 GHz wizard SiBeam falls cheaply to bigger brother

US 60 GHz wannabe SiBeam has been sold by investors for $25 million after 6 years of trying to send wireless signals, including HD video, across a roo

By PETER WHITE

Published: 21 April, 2011

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US 60 GHz wannabe SiBeam has been sold by investors for $25 million after 6 years of trying to send wireless signals, including HD video, across a room. The company absorbed $112.5 million in venture funding, with the last round only one year ago being for more than the company has sold today.

This almost certainly means that the SiBeam inspired WirelessHD is no longer a contender to dominate the in-home wireless video distribution market, which will leave WiGig still in the frame as well as boring old WiFi with some tweaks – our personal favorite.

Investors in that last round included US Venture Partners, New Enterprise Associates, Lux Capital and Hatteras Funds with both Best Buy and Cisco putting up some cash, in total some $36.5 million.

That money was to take the product to market and should have been the last round of funding, and would have tried the patience of those who invested back in 2005. The fact that the company either needs to be sold, or more likely took an opportunistic offer, seems to imply that SiBeam’s gamble to create a chip which offered both WiGig and WirelessHD capability, has failed in the market, or at the very least, needs a lot more cash.

However the buyer, Silicon Image, boasts a solid track record in not only creating connectivity standards such as DVI and HDMI, but of making money out of them. It’s revenues are at the $190 million level, and the company has a similar amount of money, $190 million, in cash and short term investments.

Silicon Image could either be buying SiBeam because it truly believes in the WirelessHD 60GHz standard, or as a cheap way into WiGig know how, or both. Either way it is an insurance policy to its vested interest in wired HDMI, one of its core revenue streams, which will eventually flag in favor of a wireless delivery format.

But the deal, and the price of the deal, make it clear that whatever the reason for the purchase, it is NOT because the WirelessHD is doing well, or else the price would have been high enough to recoup all of that $112.5 million.

SiBeam claims that its 90 GHz technology can support the multi Gbps speeds necessary to delivery uncompressed HD video across a room, with the second generation WirelessHD specification claiming to support a data rates up to and beyond 20 Gbps, which will support 4K (4 times 1080p) and Deep Color (with more bits used on each pixel) as well as 3D and will also offer sync’n go file transfers at 1 Gbps for portable and fixed devices. WirelessHD version 1 was supposed to deliver at 10 Gbps. WiGig by comparison is supposed to begin life at 1.5 Gbps and in its second generation go to 6 Gbps.

As early as January, 2010 SiBeam had Panasonic and US TV maker Vizio bundling its chips and had shown them in LG Boxes.

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