ideas and knowledge and hard work. We knew what worked and did not work, we knew what had failed. We started focusing on developing a chip that required a complex mixed signal—analog and digital and complex digital signal processing in a single chip. It happened to be a disk drive controller.
X: In retrospect, do you think it was a good idea to go the fabless route?
SS: In hindsight, we were naive. If there had been just one more challenge in front of us, it would have been a disaster. It was hard enough to build a new chip at the time, and all of our competitors, the “real men,” had their own fabs. A lot of customers, especially in the drive industry, had never done business with fabless companies. We said that our volume was going to be 50 million units—at the time, 50 million was a huge number. People said, “If you don’t have a fab, how can you guarantee that? You must be crazy.”
Not to mention all the big competitors, who had deep pockets and dozens if not hundreds of sales and marketing guys, and we didn’t have anybody. We were just engineers talking to customers. Also, the design cycle took two years to port customers’ software to our chip. All the competitors had to do was match our performance—they didn’t have to be better, they could even be slightly worse—and we would not have had that business.
X: But you wound up having huge success in the disk drive controller business. Was it a big leap from doing that to making networking chips?
SS: It was easier than disk drives. The digital signal processing in Ethernet chips has to run at 125 megahertz. On the first channel [of our disk drive controllers] we were already running at 270 megahertz. So we saw we could just borrow many of the things we’d built and run them at slower frequencies. We borrowed a lot of building blocks from the disk drive chip. So even though our gigabit Ethernet chip was maybe 10 times bigger than the disk drive chip, we finished it in less than a year.
X: How did you differentiate your Ethernet chip from the competition?
SS: Our first gigabit Ethernet chip was introduced in early 2000, and at the time, Broadcom’s chip consumed 7.5 watts to 8 watts per chip. So we build our first chip to consume 1.8 watts, about one quarter of the power. We knew we couldn’t make it faster, because it has to run at 125 megahertz, no more, no less. So we took our expertise building mixed-signal digital signal processors to make it run at a much lower power. Nobody believed that
