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Intel, Libit Developing Internal Modem

Chip giant Intel Corp. and upstart Libit Signal Processing
Ltd. are working on a specification for a "host-based" cable modem.

The two companies intend to present the specs to the DOCSIS
(Data Over Cable Service Interface Specification) panel at Cable Television Laboratories

The development of specs for an internal cable modem not
only accelerates the time to market for such a device, but it also catapults Libit into a
strong position to deliver silicon for cable modems in an arena that is currently
dominated by Broadcom Corp.

"Host-based processing is one way of reducing the cost
from $200 to below $100 ... We encourage that. We think that it's a good thing,"
said Rouzbeh Yassini, the executive consultant to CableLabs who oversees the DOCSIS

At the same time, Yassini expressed three concerns about a
host-based approach: maintaining network integrity; ensuring network security and ensuring
that the costs of operations -- including provisioning, maintenance and troubleshooting --
don't offset the cost savings promised by the host-based approach.

"These are problems that are being addressed,"
said Jacob Tanz, vice president of worldwide sales for Libit, who worked for Intel for 15
years until "there were no new inventions that needed to get created here."

Yassini pointed out that Intel and Libit must present
CableLabs with a white paper and architectural documents before the host-based concept is
voted upon and brought into the open-standards DOCSIS process.

The host-based approach will move as much functionality as
possible from what is now performed by a cable modem's components to the host's
(or personal computer's) processor and random-access memory, said Teri Lasley,
broadband-development manager for Intel.

Lasley added that work on the draft specification should be
completed by late March.

Michael Harris, an analyst with Phoenix-based Kinetic
Strategies Inc., said cable modems must achieve the same cost curve as phone-line modems
to remain competitive, and "one way to do it is with a host-based architecture."

Lasley said a "proof-of-concept" demonstration of
the host-based concept is targeted, ambitiously, for the National Show in Chicago in June.

Libit -- the No. 2 cable-modem-chip supplier behind
Broadcom -- has been a "major contributor" to the DOCSIS effort, Harris said.
Although its only announced buyer of cable-modem chips to date is Toshiba America Consumer
Products, he expects other vendors to turn to Libit.

They have been hesitant to do so, Harris said, because
"they don't want to harm their relationship with Broadcom."