Broadcom Corporation

Broadcom Corporation is an American fabless semiconductor company that makes products for the wireless and broadband communication industry. It was acquired by Avago Technologies in 2016 and operates as a wholly owned subsidiary of the merged entity Broadcom Inc..

History

1995-2016: Founding and growth

Broadcom Corporation was founded by professor-student pair Henry Samueli and Henry Nicholas from UCLA in 1991. In 1995 the company moved from its Westwood, Los Angeles office to Irvine, California. In 1998, Broadcom became a public company on the NASDAQ exchange (ticker symbol: BRCM) and employs about 11,750 people worldwide in more than 15 countries.

Broadcom Corporation acquired ServerWorks Corporation, a maker of chipsets for IA-32-based servers, in 2001 for $957 million. This acquisition was one in a string of purchases of companies by Broadcom in the beginning of the 2000s. Unlike the others, which were struggling start-ups, ServerWorks was revenue-generating and profitable.

In 2012, Broadcom's total revenue was $8.01 billion. As of 2011, Broadcom was among Gartner's Top 10 Semiconductor Vendors by revenue. Broadcom first landed on the Fortune 500 in 2009, and climbed to spot #327 in 2013.

2016: Acquisition

On May 28, 2015, chip maker Avago Technologies Ltd. agreed to buy Broadcom Corp. for $37 billion in cash and stock. At closing, which completed on February 1, 2016, Broadcom shareholders held 32% of the new Singapore-based company to be called Broadcom Limited. Hock Tan, Avago President and CEO, was named CEO of the new combined company. Dr. Samueli became Chief Technology Officer and member of the combined company's board, and Dr. Nicholas serves in a strategic advisory role within the new company. The new merged entity is named Broadcom Limited but inherits the ticker symbol AVGO. The BRCM ticker symbol was retired.

In May 2016, Cypress Semiconductor announced that it will acquire Broadcom Corporation's full portfolio of IoT products for $550 million. Under the deal, Cypress acquires Broadcom's IoT products and intellectual property for Wi-Fi, Bluetooth and ZigBee connectivity, as well as Broadcom's WICED platform and SDK for developers. The deal combined Broadcom's developer tools and connectivity technologies for IoT devices with Cypress' own programmable system-on-a-chip (SoC) products that provide memory, computing and graphics processing for low-power devices.

Battle with Qualcomm

In June 2007, the U.S. International Trade Commission blocked the import of new cell phone models based on particular Qualcomm microchips. They had found that these Qualcomm microchips infringed on patents owned by Broadcom. In January 2017, the FTC sued Qualcomm, who allegedly made use of unlawful tactics to maintain "a monopoly on cellular-communications chips."

On April 26, 2009, Broadcom settled its four-year legal battle with Qualcomm over wireless and other patents. The deal also ended the complaints of anti-competitive behavior. As part of the settlement, Qualcomm paid $891 million in cash to Broadcom over a four-year period ending June 2013.

On March 12, 2018, President Donald Trump blocked a hostile takeover of Qualcomm by Broadcom. The chipmaker had offered over $117B for Qualcomm, and nominated 11 rival directors to its board, but the deal was barred in the interest of national security. Broadcom, then headquartered in Singapore, was considered too close to China and chipmaker Huawei. "A shift to Chinese dominance in 5G would have substantial negative national security consequences for the United States," CFIUS said. "While the United States remains dominant in the standards-setting space currently, China would likely compete robustly to fill any void left by Qualcomm as a result of this hostile takeover."

Others have stated that Mr. Trump's decision was as consistent with balance of trade objectives as it was with security concerns.

2006-2008: Stock options backdating scandal

In March 2006, a report by the Center for Financial Research and Analysis identified Broadcom as one of 17 companies "at risk" for having back-dated stock options grants between 1997 and 2002. On May 18, 2006, amid media reports about options practices, Broadcom said it had started an internal review of its stock options grants. On June 12, 2006, Broadcom announced it had received a "request for information" from the U.S. Securities and Exchange Commission (SEC), and that it might soon be the subject of an informal inquiry.

On July 14, 2006, Broadcom estimated it would have to subtract $750 million from earnings due to stock options irregularities. On September 8, 2006, the company announced the amount was at least $1.5 billion, "and could be substantially more." On December 18, 2006, the SEC opened a formal investigation of Broadcom's options practices. On January 24, 2007, Broadcom announced a restatement of its financial results from 1998 to 2005 to include a total of $2.24 billion-worth of expenses related to stock option-based compensation. The grants remained the subject of the formal inquiry by the SEC, and an informal inquiry by federal prosecutors.

In between March and May 2008, the SEC announced charges against Broadcom for fraudulently backdating stock options for nearly five years, from June 1998 to May 2003. In its complaint, the SEC alleged that Broadcom's top officers at the time had misrepresented the dates on which stock options were granted to executives and employees. In describing the scheme, the SEC said: "Through backdating, Broadcom made it appear that the options were granted at times corresponding to low points of the closing price of Broadcom's stock — despite the fact that the purported grant date bore no relation to when the grant was actually approved. This resulted in artificially and fraudulently low exercise prices for those options."

On May 15, 2008, Broadcom co-founder and CTO Henry Samueli resigned as chairman of the board, and took a leave of absence as Chief Technology Officer. On June 5, 2008, Broadcom co-founder and former CEO Henry Nicholas and former CFO William Ruehle were indicted on charges of illegal stock-option backdating. Nicholas was also indicted for violations of federal narcotics laws. However, in December 2009, federal judge Cormac J. Carney threw out the options backdating charges against Nicholas and Ruehle because of prosecutorial misconduct, after finding that federal prosecutors improperly tried to prevent three defense witnesses from testifying.

Anticompetitive practices

On January 17, 2018, it was reported that the FTC had investigating Broadcom for several months in regard to its anti-competitive tactics while negotiating with customers.

In 2021, Broadcom agreed to settle an antitrust complaint which claimed it had abused its monopoly power through restrictive contract terms and threats of retaliation against non-compliant customers. Such contract terms stifle innovation and inevitably lead to higher prices. European Competition Commissioner Margrethe Vestager said that Broadcom’s contract terms with six main customers would “create serious and irreversible harm to competition” if no action were taken.

Lawsuit against Netflix

In 2020, Broadcom sued Netflix over multiple patent infringements. Critics have argued that Broadcom is suing Netflix for being more successful. The traditional pay TV industry has undeniably lost a large number of subscribers, which may be because of the rise of new internet streaming services. The Leichtman Research Group calculated that the largest pay TV providers in the U.S. – representing about 95% of the market – lost about 4,915,000 net video subscribers in 2019.

Back in 2017, Broadcom filed an array of patent suits against manufacturers of smart TVs. In 2018, the U.S. International Trade Commission ruled against Broadcom, finding that two manufacturers did not infringe on patents owned by Broadcom.

Products

Broadcom's product line spans computer and telecommunication networking: the company has products for enterprise/metropolitan high-speed networks, as well as products for SOHO (small-office, home-office) networks. Products include transceiver and processor ICs for Ethernet and wireless LANs, cable modems, digital subscriber line (DSL), servers, home networking devices (router, switches, port-concentrators) and cellular phones (GSM/GPRS/EDGE/W-CDMA/ LTE). It is also known for a series of high-speed encryption co-processors, offloading this processor-intensive work to a dedicated chip, thus greatly speeding up tasks that utilize encryption. This has many practical benefits for e-commerce, and PGP or GPG secure communications.

The company also produces ICs for carrier access equipment, audio/video processors for digital set-top boxes and digital video recorders, Bluetooth and Wi-Fi transceivers and RF receivers/tuners for satellite TV. Major customers include Apple, Hewlett-Packard, Motorola, IBM, Dell, Asus, Lenovo, Linksys, Logitech, Nintendo, Nokia, Nortel (Avaya), TiVo
Tenda
and Cisco Systems. In September 2011, Broadcom shut down its digital TV operations. Broadcom also shut down its Blu-ray chip business. The closure of these businesses began on September 19, 2011.

On June 2, 2014, Broadcom announced intentions to exit the cellular baseband business.

Network interface controllers

Vendors have included Broadcom NICs in their products. For example, Dell PowerEdge M-Series blade-server products may be fitted with Dell-supplied Dual Port Broadcom NetXtreme 5709 Gigabit Ethernet port adapters.

Trident+ ASIC

Another large market is hardware for switches: some vendors offer switching equipment based on Broadcom hardware and firmware (e.g. Dell PowerConnect classics) while other well-known vendors do use the Broadcom hardware but write their own firmware. The latest Broadcom Trident+ ASIC is used in many high-speed 10Gb+ switches from the largest switch-vendors such as Cisco Nexus switches running NX-OS, Dell Force10 (now Dell Networking) running FTOS/DNOS,Jason Edelman Blog o
40 Gbps datacenter switching
, December 10, 2011. Retrieved May 17, 2012 all Arista 7050-series switches, the IBM/BNT 8264, and Juniper QFX3500.

The latest 'member' of the Trident family is the Trident II XGS which can support up to 32 x 40G ports or 104 x 10G ports (or a mix of both) on a single chip. Examples of switches using this Trident II XGS chip are the Dell Networking S6000, Cisco Nexus 9000 and some smaller vendors like: EdgeCore AS6700, Penguin Arctica 3200XL or QuantaMesh T5032

Graphics processing unit

VideoCore is the GPU found on some systems-on-a-chip (SoC)s by Broadcom, the most widely known one being the BCM2835 containing VideoCore IV found in the Raspberry Pi.

Video acceleration

Broadcom Crystal HD does video acceleration.

WiFi chipsets

Broadcom "BCM43" series chips provide WiFi support in many Android and iPhone devices. Models include the BCM4339 used in phones such as the Nexus 5 (2013) and the BCM4361 used in the Samsung Galaxy S8 (2017). These are SoC devices with a Cortex R4 for processing the MAC and MLME layers and a proprietary Broadcom processor for the 802.11 physical layer.
The chips also handle Wi-Fi Direct, Bluetooth and NFC.

* Broadcom supplies the WiFi+Bluetooth combo chip for Apple iPhone 3GS and later generations and corresponding iPod touch generations.
* In Q2 2005, Broadcom Corporation announced it would be providing Nintendo its “online solution on a chip” as deployed in millions of notebooks and PDAs across the globe, enabling Nintendo 802.11b connectivity with DS and 802.11g for the Wii. More specifically, Broadcom would provide Bluetooth connectivity for Wii's controller.
* In 2013 Broadcom unveiled the first 802.11ac 5G Wifi SOCs which is adopted across many mobile phones including the Samsung Galaxy S4 and S5, the HTC One and the LG Nexus 5. Additionally, routers from Motorola, Netgear, Huawei and Belkin also include Broadcom's 802.11ac chips.

Vulnerabilities in SoC WiFi stack

In April 2017, Google's Project Zero investigated Broadcom's SoC WiFi stack and found that it lacked "all basic exploit mitigations - including stack cookies, safe unlinking and access permission protection," allowing "full device takeover by Wi-Fi proximity alone, requiring no user interaction." Numerous smartphones, such as by Apple, Samsung and Google were affected.

BroadVoice

Broadcom authored its own VoIP codecs in 2002, and released them as open source with LGPL license in 2009:
* BroadVoice 16 with declared bitrate 16 kbit/s and audio sampling frequency 8 kHz
* BroadVoice 32 with declared bitrate 32 kbit/s and sampling rate of 16 kHz (note however that X-Lite SIP phone's menu declares bitrate 80,000 bit/s)

Linux products

Some free and open source drivers are available and included in the Linux kernel source tree for the 802.11b/g/a/n family of wireless chips Broadcom produces. Since the release of the 2.6.26 kernel some Broadcom chips have kernel support but require external firmware to be built.

In 2003, the Free Software Foundation accused Broadcom of not complying with the GNU General Public License as Broadcom distributed GPL code in a driver for its 802.11g router chipset without making that code public.

The chipset was adopted by Linksys which was later purchased by Cisco. Cisco eventually published source code for the firmware for its WRT54G wireless broadband router under the GPL-license.

In 2012, the Linux Foundation listed Broadcom as one of the Top 10 companies contributing to the development of the Linux Kernel for 2011, placing it in the top 5 percent of an estimated 226 contributing companies. The foundation's Linux Kernel Development report also noted that, during the course of the year, Broadcom submitted 2,916 changes to the kernel. That October, Broadcom released parts of the Raspberry Pi userland under a BSD-style license. According to the Raspberry Pi Foundation, this made it "the first ARM-based multimedia SoC with fully functional, vendor-provided (as opposed to partial, reverse-engineered) fully open-source drivers", although due to substantial binary firmware code which must be executing in parallel with the operating system, and which executes independently and prior to loading of the operating system, this claim has not been universally accepted.

Broadcom provided a Linux driver for their Broadcom Crystal HD, and they also hired Emma Anholt, a former Intel employee, to work on a free and open-source graphics device driver for their VideoCore IV.

Raspberry Pi

Broadcom organizes the fabrication of the processor chip, most recently the BCM2837 chip and the wifi processor BCM43438, which is used by the charitable Raspberry Pi Foundation. The foundation requested help from Broadcom making the Raspberry Pi card, a motherboard which is free of DRM or corporate control of any kind, which can interact with hardware, and which can be bought and controlled by children.

Jericho2 Programmable Chip

Jericho2 is a programmable Ethernet switch chip that has up to 10 Tbit/s switching capacity per device.

Tomahawk-3 Chip

Tomahawk 3 series supports high-density, standards based 400GbE, 200GbE, and 100GbE switching and routing for hyperscale cloud networks. Broadcom divulged that it is bringing two variants of the Tomahawk-3 to market. The first has the full-tilt-boogie 12.8 Tbit/s with all 256 SerDes fired up, supporting 32 ports at 400 Gbit/s, 64 ports at 200 Gbit/s, and 128 ports at 100 Gbit/s. The second variant of the Tomahawk-3 has 160 of the 256 SerDes fired up and delivers 8 Tbit/s of aggregate bandwidth. Broadcom is suggesting 80 ports at 100 Gbit/s; or 48 ports at 100 Gbit/s plus either 8 ports at 400 Gbit/s or 16 ports at 200 Gbit/s; or 96 ports at 50 Gbit/s plus either 8 ports at 400 Gbit/s or 16 ports at 200 Gbit/s.

Business

Notable employees

* Henry Samueli, co-founder and CTO
* Henry T. Nicholas III, co-founder and CEO until 2003
* Scott A. McGregor, President and CEO from 2005 to the company's acquisition in 2016
* Gottfried Ungerboeck, inventor of trellis coded modulation
* Sophie Wilson, designer of the ARM CPU instruction set
* Eben Upton, creator of the Raspberry Pi single-board computer
* Broadcom Fellows, Broadcom Fellow is the highest honor bestowed upon Broadcom engineers.

Notable alumni

Many Broadcom employees have gone on to take key positions in successful tech enterprises and starts ups, including:

* Bagher Afshar, who became principle RFIC Engineer at SpaceX
* Michael Hurlstone, who became CEO at Synaptics
* Nariman Yousefi, who became Senior VP at Inphi Corporation
* Michael di Nil and Andrew Terry who founded Morse Micro

Manufacturing

Broadcom is known as a ''fabless'' company. It outsources all semiconductor manufacturing to foundries, such as GlobalFoundries, Semiconductor Manufacturing International Corporation, Silterra, TSMC and United Microelectronics Corporation. The company is based in Irvine, California. Since 2018, the company has been based at a custom-built headquarters campus just south of the Orange County Great Park. The company originally intended to occupy the entire campus, but after the Avago acquisition, it sold the site to FivePoint Holdings and then leased back only two of the four buildings.

Broadcom was previously headquartered in the University Research Park on the University of California, Irvine campus from 2007 to 2018, and before that was headquartered near the Irvine Spectrum. The company has many other research and development sites including Silicon Fen, Cambridge (UK), Bangalore and Hyderabad in India, Richmond (near Vancouver) and Markham (near Toronto) in Canada and Sophia Antipolis in France.

Acquisitions

In September 2011, Broadcom bought NetLogic Microsystems for a deal of $3.7 billion in cash, excluding around $450 million of NetLogic employee shareholdings, which will transfer to Broadcom.

Besides the NetLogic Microsystems acquisition, through the years, Broadcom has acquired many smaller companies to quickly enter new markets.

Branding

The Broadcom logo was designed by Eliot Hochberg, based on the logo for the company's previous name, Broadband Telecom. The Broadband Telecom logo was designed by co-founder Henry Nicholas' then wife, Stacey Nicholas, who was inspired by the mathematical sinc function.

Philanthropy

In 2009, the company founded the Broadcom Foundation as a non-profit corporation with a $50M investment, at the direction of Henry Samueli, the company's co-founder, and then-Broadcom Chief Executive Scott A. McGregor, who cited a history of science fair involvement as a factor for his own success. McGregor was named the foundation's first president and chairman.

See also

*Broadcom Inc.

References

External links

Broadcom homepage

Broadcom SEC Filings


* Channel partner in India

{{Authority control

1991 establishments in California
Companies based in Irvine, California
Electronics companies established in 1991
Companies formerly listed on the Nasdaq
Networking companies of the United States
Technology companies based in Greater Los Angeles
2016 mergers and acquisitions