iPhone and the Future of Broadcom

In January, EE Times wrote:

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We’re not drinking the Apple Kool-Aid, but Jobs and team do seem to get it: It’s not the technology, stupid; it’s the experience. We love engineers, but you shouldn’t need one to make your digital home work. Whatever the quibbles over iPhone’s price and novel touchscreen interface, Apple seems to have the right recipe for the next big thing: simplicity. The iPhone’s single button says it all.

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Indeed, as Frank outlined, one of the coolest things about the iPhone is the user interface … the redefinition of “gestures”. Thus, the chip vendor with the most at stake in whether consumers accept or reject this attempt, is Broadcom, provider of the touchscreen controller chip.

The jury is definitely out on this issue, and it will be very interesting to watch what happens in the realtime marketplace in a few months. Ofcourse, if the user interface redefinition is a success, then we have implications well beyond just the iPhone:

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Citing positive feedback through channel checks and saying the company’s touch screen technology may have a far larger market opportunity beyond Apple Inc.’s iPhone, analyst Alex Gauna of UBS Securities LLC Thursday (Jan. 25) upgraded his firm’s rating on Broadcom Corp.’s stock to “buy” from “neutral.”

Gauna said Broadcom’s touch screen controller chip, found in Apple’s recently unveiled iPhone, may have applications in larger screen displays. UBS believes Apple may migrate the technology into other offerings, including iPods, notebooks and Apple’s forthcoming television product, over time, Gauna wrote.

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Meanwhile, one damper: Braodcom has lost a video iPod piece to Nvidia, which will turn out costly!