ParkerVision 2005 PA Announcement
January 20, 2005
Ann Marie
Jeff Parker, CEO ParkerVision
John Bucher of Harris Nesbit
Will Lewis of Baystar Capital
Joseph of Lehman Brothers
Bob Malarnick [sp] of Arbor Capital
Management
Amir Ecker from ACT Capital
Peter Conrad, of Kopp Investment
Advisors
Barry Rugger of ETE
George Walker of Wachovia Securities
Ann Marie: Good day ladies and
gentlemen and welcome to the new power amplifier conference call. My name is
Ann Marie and I'll be your coordinator for today. At this time all participants
are in listen only mode. We will be facilitating a question and answer session
towards the end of this conference. If at any time during the call you require
assistance please press *0 and a coordinator will be happy to assist you.
Before we get started I want to remind listeners that this conference call will
contain forward looking statements which involve known and unknown risks,
uncertainties about our business and the economy and other factors that may
cause actual results to be materially different from our expected achievements
and anticipated results. Included in these risks are factors such as the
ability to maintain technological advances in the marketplace, ability to
sufficiently increase manufacturing capacity to meet demand, achieving timely
market introduction and acceptance of our products, maintainig our patent
protection and availability of capital, among others.
Given these uncertainties and other various factors about our business,
listeners are cautioned not to place undue reliance on any of the forward
looking statements contained in this conference call. Additional information
concerning this and other risks can be found in our filing with the SEC. And
now I'd like to turn the presentation over to your host, Mr. Jeff Parker, CEO
of ParkerVision. Please proceed, sir.
Jeff Parker: Thank you. So, good
afternoon and thank you for joining us on this ParkerVision conference call.
It's with a great deal of pleasure that I'm able to share with you the latest
developments coming from ParkerVision in both technology advancement and
resulting product. Our direct to data psychology really represents our
expertise in converting older and more inefficient analog circuits into high
performance digital circuit architectures. Our digital architectures don't
carry with them the same inherent limitations that our analog predecessors were
limited by. And so today we introduce ParkerVision's first product line of RF
power amplifiers. By extending the science of our d2d technology into power
amplifiers, we've been able to transform RF power and amplifiers from analog
circuits and eliminate many of those inherent limitations of today's products
and pave the way for a multitude of advances not only in the power amplifier
itself but also in the products that rely upon these amplifiers.
ParkerVision is redefining the performance that will now be expected for these
kinds of applications. In brief, the power amplifier is one of the critical
components to many of the wireless RF products. Cell phones, WiFi, cordless
phones, voice over IP phones and many other products all rely on RF power
amplifiers. This is the component along with the transmitter that sends the RF
signal off the antenna and is responsible for a major portion of the power
consumed in many products. However, due to the older analog circuit it is not
uncommon at all that the efficiency of the transmitter and the power amplifier
are relatively low. Let me give you an example. The efficiency of the
transmitter and the power amplifier in a WiFi product that's using 802.11G runs
at about the five percent range. For 802.11V the efficiency of the transmitter
and the power amplifier run in the 8‑9 percent range. So in the G
products that have five percent efficiencies this means that 95 percent of all
the power it takes to run those circuits goes up in heat, does not come out of
the antenna in any useful purpose. Similar kinds of efficiencies are found in
products that require complex signals to move large amounts of data or provide
services such as what is being deployed in 3G cell phone networks that use CDMA
or wide band CDMA. The results of incorporating our product is the reduction by
50 to 80 percent of the overall power consumption typically used in many of
these products. The benefit that this brings to manufacturers is really
multidimensional.
If you're a designer wanting to reduce the cost and size of your cell phone
handset, we have a solution for you because you can shrink the size of the
single most expensive component in many handsets‑‑the battery. If
you're a designer wanting to maintain your battery size and increase the talk
time we have solutions for you. With many of the 3G cell phone networks one of
the challenges is that consumers are having to take a step back in performance
in terms of talk time. Maybe your 2G cell phone has five or six hours of talk
time, but now your 3G phone only provides an hour or two. We can show designers
how to get their talk times right back to what consumers are looking for or
even beyond.
If you're looking to design the next generation of WiFi products and you want
to increase business but not power consumption we have the solution. If you're
looking to extend battery life for WiFi because you're using this in the PDA or
a smart phone we have that solution as well.
Maybe you're trying to move video and audio around the house and you need a
reliable operation that's been elusive. We can show you how our power
amplifiers can help make that a reality. If you want to incorporate your own RS
transceivers that's fine. If you want the world's best range along with the
best reliability from noise and interference you might want to incorporate our
d2d transceivers as well.
Cordless phones that allow you to walk around the block and sound as if you're
next to the base station are enabled by our power amplifiers.
Needless to say, these products and the underlying technology provide a number
of options to product designers that they have not had before. In addition to
being feature rich our power amps will be very cost effective. We will deliver
these chips at prices that match the inferior products they replace. Of course,
if you want to strictly save cost we can provide power amplifiers that match
today's analog amplifiers in performance and deliver those at lower cost than
what power amplifier companies are selling the analog power amplifiers for
today.
These savings don't even take into account what our VPA family of power
amplifiers will provide, which is a true breakthrough in that it is the total
elimination of the traditional transmitter hardware. This provides opportunity
for even more cost and size reduction.
We will be expanding our conversations with OEMs and ODMs immediately, both
those we're already in dialog with about our existing products, and now of
course, the much larger universe of customers who design and build the volumes
of wireless products today.
So we thought you might have a few questions from today's announcement and so
to provide you with feedback as timely as possible we scheduled this conference
call to address your questions as quickly as we can. And so with that I'd
really like to open up this call for your questions. So can we do that please.
Ann Marie: If any of you wish to ask a
question please press "*1" on your touch tone phone. If your question
has been answered or you wish to withdraw your question, please press
"*2". Again, to ask a question, the command is "*1", and
we'll pause for a moment as questions queue up.
Again, that is "*1" for questions and your first question comes from
John Bucher of Harris Nesbit. Please proceed.
John Bucher: John Bucher with Harris Nesbit.
Good afternoon. Question. What do you view as the first initial application
area? Will it be wireless land devices or wireless wide area or cellular
devices? And then any particular radio technology that you think will be your
initial focus? And then finally, can you give us an idea on availability for
these as well?
Jeff Parker: Sure. Our first models out
are focusing heavily on the more complex wave forms. The more complicated the
wave form for the radio and the more challenging the application the more
difficult the power amplifier is because the linearity requirement. So our
initial focus is really going to be on 802.11 G and N and B and also for CDMA
cell phones and wide band CDMA cell phones.
The timing on all that is we will have samples for those applications that OEMs
and ODMs can go run their own testing a little later in the second quarter.
From there what we're hoping to do is to get feedback to be able to provide the
final form factors that they want in terms of packaging and possible other
features that they may want us to incorporate later this year.
John Bucher: Quick follow up, do you
already have your license chips in place, on the supply chain side?
Jeff Parker: We do, it is pretty publicly
known that we have a good relationship with Texas Instruments, but we've also
been in dialogue with additional suppliers and I would expect that you'll hear
more about that in the first half of this year.
John Bucher: Thank you very much.
Jeff Parker: Thank you.
Ann Marie: And your next question comes
from Will Lewis of Baystar Capital. Please proceed.
Will Lewis: Congratulations on this
announcement, Jeff, and everyone at ParkerVision. My question relates to how
you intend to pursue this product versus your strategy for the transceiver.
This product is obviously more of a component sale of teams. On the transceiver
side you went with really vertical integration. Going forward, how do you see
yourself positioning the company, is it more of a component provider, is it
more of a vertically integrated manufacturer? Can you comment on that? And I
have one quick follow up.
Jeff Parker: OK, sure. We will be
aggressively pursuing component sales directly with OEMS and ODMS. We are
organizing a separate sales organization, which we already know the beginnings
of, who will be taking charge to work directly with field application engineers
to assist these OEMS and ODMs through the process of designing the chips. The
nice aspect of these particular components is that they are much less
dimensional in terms of the testing requirements and the time to test, and the
time to make the best one, then our transceiver, being a really complete and
whole system, the power amplifier being just an individual component.
To give you a sense of the scale; to test the transceiver in an application
could take a small team of engineers a week, even several months to understand
all the different dynamics that happened with the transceiver over various
operating conditions, to provide a conclusion. In the power amplifier component,
you can get through the line and shear of a visual assessment in just a few
hours.
So, the job of our sales organization is to get the power amplifier
demonstration units and test boards into the hands of all the important
decision makers in these companies that are designing handsets for cell phones,
cordless phones, WiFi products, Voice‑Over‑IP phones, etc, to find
out what flavor they want them in, and what features they might want us to
incorporate that we haven't already thought of. That tells you our focus.
We will also consume these power amplifiers ourselves in our own products. We
are coming out with a cordless phone shortly, we want to additionally start out
with our own power amplifier, and we're very excited to design an iteration of
that later this year with the power amplifier, because it will extend the talk
time dramatically, and it will extend the range even further than we have
already designed, and it will make a more elegant solution. So, every time we
find an opportunities to showcase in whatever finished goods we are in the
process of designing our own components, we will do that.
There's also an in‑between place where we're in dialogue with actually a
number of companies right now who have either tested our existing WiFi products,
are looking at the cordless phone that's in development, and they're saying,
"Hey, can we buy modules, or cards out of those products to incorporate
with our own products?" and we will be aggressively pursuing that as well.
So, we want to become a real solutions provider up and down the food chain,
wherever we can find that we bring value. Our focus though, will be on high‑volume
applications. We won't be targeting niche low volume applications. This is a
semiconductor technology, and we will thrive on high volume designs, and that's
what we'll be going for.
Will Lewis: OK, that's very helpful, and
then just a follow up. Do you anticipate additional capital needs in order to
pursue this new product strategy?
Jeff Parker: Possibly. We're always
looking at that. We've been encouraged by some of our suppliers who provide
components to us for products today, that are willing to start extending very
favorable terms, and all sorts of programs to help us as we grow our inventory
bills and such to help delay, or accrue cash flow requirements, but we are
expanding with this product line into additional needs, and so we may very well
look at some additional capital for the company, to make sure that we can
properly fund and support all the growth activities, that I think is imminent.
Will Lewis: Thanks very much.
Jeff Parker: Thank you.
Ann Marie: Your next question comes
from John Stanley, a Stanley Merchant partner, please proceed.
John Stanley: Jeff, can you please expand a
little bit on what sort of efficiencies is the afford in terms of cost to
potential customers?
Jeff Parker: Sure, John, in the cost side,
it really is dependent on what they want to make the technology focus on, and
I'll give you an example. If you are a handset designer, and we're talking a
fairly standard handset, maybe not a smart‑phone with a PDA built in, but
we'll just say a basic cell phone. One of, or maybe the single most expensive
component of that entire handset is the battery. So, one of the things that
you're looking to do is take off with that product, because that market space
continues to get more competitive, and manufacturers are looking to expand
their reach to be able to also offer these products to a wider audience.
So, you're charged with, as a designer, to get more cost out of the product,
and you can't violate the laws of physics, so if your power amplifier is
only....if your whole transmitter chain is only five, or ten, or fifteen
percent efficient, you need a certain type of battery. So what ParkerVision
does in that situation is we say, "Hey, how would you like to cut your
battery requirements in half, or in some cases, even more, and yet keep the
same profit?" the battery technologies are priced by the OEM provided in
terms of the power, and for us to be able to say, "Hey you can cut that
OEM power down to 50 percent, 60 percent" comes right out of their
building materials. When they take the transmitter out of their products, if
they decide to go with our VPA product, we can show them how to literally take
the entire transmit chain and again present with a product, but some of these
products are not a simple affair.
That entire chain of parts, and the board and circuitry just goes away. What
they do is they take the digital base band signal to come out of their processor,
which would normally go to a transmit chain of parts, and ultimately handed off
to the power amplifier. That all goes away, it goes right from the digital
output of the processor right to our VPA, and that VPA is truly revolutionary,
because it will single step a single electrical operation, turn the received
signal into an on‑channel, amplified RF carrier, and sends it to the
antenna, and there's more cost‑savings in terms of components, and
depending on the cell phone itself. If we're talking about a more complex phone
like a wide‑band PDMA 3G fold‑over in Europe or in
I'll give you another example. We just did a little benchmarking for WiFi. We
had a OEM send us a laptop with their embedded WiFi solution, just to see if we
used our own mini‑PCI card, our d2p card. this is with our power
amplifier; this was with additional power amplifier. What would happen to the
battery life? What happened to the distance?
When we plugged our card into their standard set of antennas in the lid and we
got our mile of performance, that we talk about all the time, against the
thousand feet of takeout the latest and greatest embedded solutions. And what
was very interesting was the difference in battery life. This is now just using
the d2p and I'll extend it a little further. So, without a WiFi system at all
running in this laptop, the battery lasted three hours and five minutes. With the
embedded solution that currently is provided in that laptop the battery life
was reduced by 47 minutes. With our [inaudible] d2p technology it is reduced by
23 minutes, and with our power amplifier in there we calculate it will only be
reduced by 11 minutes. So we are trying to give you a sense of scale. Those are
the kind of gains that people will be able to achieve.
On WiFi, one last comment, we will be able to show people how they can go in
another direction with the technology also. Where they can say, I want to get
more distance and I'm OK with the battery life the way it is. If you want to go
to that metric, we'll be able to show people how they can increase their
distance two times, four times, or more, by the power amplifiers output that it
can deliver. In today's analog amplifiers they can't even go there. That is
because they consume so much power that there is not enough power available in
the laptop to power such a thing. So it's not even an option they can consider.
I don't know if that answers your question entirely, but it is so different for
each one. But you will see a series of application examples coming out from us
over the coming weeks.
John Stanley: OK. And then lastly, Jeff,
silicon has been used in low‑end applications, gallium‑arsenide in
high end. How are you able to do this with silicon?
Jeff Parker: Well, we can't just yet
disclose exactly what the digital architecture is. The patents are still
pending. We'll issue eventually and publish as well. But let me say this: what
you look for in a power amplifier, especially one for these complex applications
like 511G and N, which use OFDM or CDMA, you look for very, very high degrees
of linearity. If you look at a d2p transceiver and you say, what are d2p's
greatest attributes? It's extremely high degrees of linearity. By the way, we
get out of drifting mode today in our receivers. So if you just started with a
d2p science as a very highly linear, how do you take digital circuits and get
very highly linear results, using silicon? You say, boy if I could apply that
concept to the power amplifier world, where I could get very high degrees of
linearity, then CMOS and [inaudible] now become reality.
In essence, yes, if you take circuit architectures, especially the old analog
ones, which are not as linear as people would like, and then you start throwing
the inefficiencies of CMOS and [inaudible] you are not going to get out of
there with the results you are looking for. So we really are starting from a
whole different architectural place.
John Stanley: OK, thank you, Jeff.
Congratulations.
Jeff Parker: Thanks.
Ann Marie: We now have questions coming
from Joseph Graves of Lehman Brothers. Please proceed.
Joe Graves: Hey, Jeff, it's Joe.
Jeff Parker: Hey Joe.
Joe Graves: Some terrific news here
today. A lot of the initial questions I had were already asked, but a rather
direct question would be: Who will be responsible initially in the sales effort
for this particular product?
Jeff Parker: We've actually already been
interviewing and have some great candidates that are imminent to come to the
company who have a lot of experience in careers of selling components like this
to OEMs and ODMs all over the world. And as we've gotten closer to this
announcement, we've been able to share with some of these candidates what we're
coming out with and their enthusiasm is extremely high. So I don't think we're
going to have any problems at all bringing to the company the kind of quality
people that we need and want who have the kind of experience working with these
kinds of accounts that we want to go after and I would even say that we will
have the first ones on board before the end of the second week of February,
possibly before the end of the first week of February. So we're moving right
along on that.
We're already in dialogue with a number of OEMs and ODMs who have started
talking to us about things we've started doing in WiFi and cordless phones and
have been asking about our transceivers so I think our timing is excellent. And
it takes those conversations and some more fuel on the fire. There will be a
completely separate selling organization and support organization to the sales
force to do the chips and components that as you know the management is a whole
different thing and I think it's a wonderful leverage point for the whole
company because the way this will be organized is we'll have key account
managers who will be supported by some in‑house application engineers but
there's also worldwide rep organizations who live in these OEMs and ODMs
several of whom we've already been in contact with and talking to who would
love the opportunity to support us in our efforts to work with the designers in
Asia and Europe and all across the US and we will be in those additional
accounts starting literally in the next few weeks and pushing forward as fast
as we can.
Joe Graves: Fair enough, I guess the
following to that would be additionally speaking to these particular customers,
what kind of kickback have you received, given the disruptive nature of this
technology it kind of goes against the grain of industry wide standards to me,
my wife and I, a lot of the things you've developed is just terrific, but the
sheer performance characteristics doesn't it scare people? This news story
shocks me I haven't seen something this interesting in long time how do you
prove out these concepts other than...
Jeff Parker: Joe, I think what I'm excited
about with this particular product line is it is orders of magnitude simpler
conversation than what we've been talking to these companies about with
transceivers. When we talk about transceivers there's so many dimensions in
production and ifs ands or buts that it really takes designers a lot of time to
sort through the questions and figure out can they embrace what we've developed
and get out of it what we claim we can get out of it, which is why we just went
ahead and just said put the products together and go from there. With a power
amplifier, you really are down to a single component dimension. They put
something in and out the other end comes and amplified signal or it doesn't.
They have a handful of metrics that they're interested in knowing that
determine whether you've distorted that signal or not and that's it. And
literally people will be able to test in a few hours whether we say does or
doesn't happen.
So I believe and I think a number of sales people we're interviewing now and I
think a few of them will come on shortly seem to verify in their own minds that
this is definitely orders of magnitude simpler sales. I personally think that
the power amplifier we'll look back on in a year and say that was the ultimate
Trojan Horse for ParkerVision and these companies will start saying "hey
you know I really like these power amplifiers, tell me more about your
transceivers" and in that case by the way, they may not even be talking about
transceivers they may be thinking "more about your receivers" because
we'll have eliminated the transmitter. So I'm very optimistic.
And I think that what you see in the power amplifier program, frankly, is a
result of what we've learned over the last 18 to 24 months. This was no
accident. We went out there and we learned some things about the market and we
said, "OK, we understand the lay of the land. What can we bring to these
companies that they will be able to embrace us much quicker and really want to
take our technology in?" All those things converge in this power
amplifier.
Joe Graves: That somewhat answers it for
now. It's exciting news, and in a sense does seem to be a substantial Trojan
Horse for this company. Congratulations.
Jeff Parker: Thank you.
Ann Marie: Your next question comes
from Bob Malarnick of Arbor Capital Management. Please proceed.
Bob Mlarnick: Hi, Jeff.
Jeff Parker: Hi, Bob.
Bob Mlarnick: Hats off to you and
congratulations to the boys over at
Jeff Parker: Thank you. They have been
working their tailbone off. You've met many of them so you know Dave Sorrells,
our CTO. One of his comments that I love is how you can't predict a
breakthrough at three in the morning on a Thursday; it happens when it occurs.
But these guys have just worked without ever doubting that they could do this.
And their reduction of the d2d down to the electronics now is trying to help us
move faster and faster as a company. David Sorrells, our CTO, and Greg Rawlins,
our chief staff scientist, are leading this and they're doing a marvelous job.
Bob Mlarnick: I couldn't agree more. A
couple of questions. You mentioned in your press release the amount of
configuration and customization that a potential OEM or ODM would have to do to
this product to utilize it. I'm just kind of curious in what that might entail,
because that certainly affects time‑to‑market and time‑to‑revenue
for yourself. An ability to take sockets away from encumbrance there and to
include software/firmware requirements, it changes.
Jeff Parker: Right. Well this is the
reason we've come out with two families. The DPA family, the Digital Power Amp
family, is designed to be a drop‑in replacement. And I hesitate a little
bit to say "Plug and Play" Bob. I don't know if that's an appropriate
term when you're talking about chaining up electronic components. But it's
going to be close to it and we may be able to get right to that. It's literally
you take the RF signal in, that you currently put into your existing power amp,
and out the other end comes amplified RF.
And the reason we made this announcement today is we want to get out to these
OEMs immediately and say, "Hey, for your next generation are you guys
putting in the 16‑pin package, or some other pin package? How do you want
to see this package? What feature is there that we may have missed?"
But, I mean, we have scoured many of the products that we want to be in and
there's kind of a common thread of what these companies are using today. So our
DPAs are targeting to replace those existing power amplifiers, which today are
typically modules, and to do it in way that it has the same benefits.
The reason power amplifiers have gone to modules is that the companies who
produce these are trying to make these kind of designer‑friendly in that
you don't have to do a lot of matching components for the input and the output,
etc. We do exactly the same thing. So as long as we have the features that
match the other features that we're replacing and the same pin‑outs and
the same package, they should be a drop‑in replacement.
Now, the VPA to me is a little longer term for the company that says,
"Hey, I love everything you're saying. By the way, if you can really get
rid of that transmit chain, I want it out of there." And we can show them
how they can use their existing baseband processor to do that.
And I would expect that what you will see also from ParkerVision in the coming
months will be more information on other baseband companies that we're working
with who will embrace the interface between their processor and our VPA.
Because when they do that, they will make the job of dropping this into products
seem really a no‑brainer.
In fact, it will be easier to apply than the RF input today that they put into
power amplifiers. There won't be an RF input; it's gone. So the job of having
to worry about running these RF signals around the circuit board on the input
side literally goes away. And people will love designing with that.
Bob Mlarnick: So the initial product
introductions and usage by OEMs and ODMs probably will occur in the DPA family
line first?
Jeff Parker: I would imagine.
Bob Mlarnick: All right. Next question‑‑your
initial forays into 3‑gigahertz RF signals or below. You intimated in
your press release that it might be expandable up to 6‑gigahertz
frequencies. So you hit the 5.8 type of transmit limitations. So I guess my
question is how do you know you can do that, and what is the power efficiency
and linearity characteristics as you go up in frequency.
Jeff Parker: Yeah. The beauty of the
architecture is because it's all digital, our ability to predict, again,
various processes is very high. So right now the power amps that we're coming
out with are on a process that we are extremely comfortable, confident and very
familiar with. We know exactly how to push and pull that semiconductor process
around. We've been using it for a while.
Bob Mlarnick: That's the TI?
Jeff Parker: Right. There are other
processes now that are being made available to the company, both within and
outside of TI. And I'm not at liberty to really share who those other companies
are, but I'm very encouraged. And we've already gotten the design parameters with
these other processes.
And when we look at putting the technologies into these other processes, moving
up to 6‑gigahertz is no stretch at all. In fact, we'll probably go
higher. I put in the press release up to 6‑gigahertz, but really what
we're going to target is going to be the 5.2 and 5.8 gigahertz unlicensed
bands, which is where really the volume of the business will be.
Bob Mlarnick: Because traditionally at
these higher frequencies GaAs chips are the ones with the superior power
efficiency over silicon, and reduced noise characteristics, etc.
Jeff Parker: Listen, you know, it's funny.
Some years ago a few big semiconductor companies predicted that CMOS and SiGe
would someday rival GaAs for RF power amplifiers, and they were right. So, you
know, their timing might have been a little wrong but some of them that we've
talked to have said to us, "Boy, this is really heartening, because some
of our predictions are now going to come true."
Bob Mlarnick: My last question, and I'll
let others get on, is about the pricing strategy in this new product area.
Revenue and profits are of utmost importance to your firm and us as investors
and I'd like to hear how you plan to go to market with these new products.
Jeff Parker: The way we want to go to
market, Bob, is to price the... When we look at the cost of producing these
products on these kinds of semiconductors we already start with a really nice
advantage because we're monolithic, we don't have to build modules‑‑substrates
with multiple components and chips which have yield issues, which have lower
volume semiconductor foundations in gallium arsenide and other exotic things
that people are working on. So we start from very good wafer pricing and we
don't have the module packaging to deal with.
So when we look at our cost structure we are comfortably going to be able to go
out there and say that we will match the prices of the amplifiers you're buying
today and give you a lot more performance. But by the way, if you don't want
more performance, if you just want to pay a lower money for a power amplifier,
that pulls our power amplifier in a slightly different direction, and we can
make it even less expensive and pass those savings right on to the customer. So
they can either have a lot more performance for the same money or they can have
the same performance for less money, and they can make that choice.
Bob Mlarnick: How do you dumb down the
technology then? I guess. Software at a lower cost but at the same performance
as the existing solutions.
Jeff Parker: It's all die size and how
many dies and yields we get out of these wafers. And if they're not as
concerned about high linearity and certain efficiencies that come with that, we
can shave down some of the digital architecture and pass those savings right on
to them. If they want to have the best that we can give them, hey, then we'll
do that and we'll be competitive with what's currently out there today and do
it at very good margins for our company.
Bob Mlarnick: Thank you again, Jeff. Best
wishes.
Jeff Parker: Thank you so much. Thanks for
your support.
Ann Marie: Your next question comes
from Amir Ecker from ACT Capital. Please proceed.
Amir Ecker: Jeff, hi. Again,
congratulations as well. A lot of my questions have been answered. I guess I'm
a touch confused. You said on the cordless phone that you're going to be
introducing that it will not incorporate your power amp to begin with.
Jeff Parker: Right.
Amir Ecker: How do you achieve the... Is
it the transceiver module then?
Jeff Parker: Yes. Our transceiver, in and
of itself, it's interesting. I was sent by a company that does a lot of
cordless phone designs for worldwide‑known brands who sell cordless
phones. They do a lot of the designs for those companies. And they had heard
we're coming out with a cordless phone, and they said, "Hey, maybe
ParkerVision would like to look at using us as a design house."
And so they sent me a brochure which shared the absolute best dynamic range
sensitivity, etc., that the cordless phones that they designed and feel the
company achieves today. And we achieved, with our first generation we're coming
out with, 21 dB more dynamic range than what they claimed is the best that's
out there. That's HUMONGOUS.
Well, we talk about this two‑mile distance. And most of the phones that I
go out and pick off the store shelves and benchmark‑‑and I try to
benchmark all of them‑‑are about 800 to 1,000, maybe 1,200, feet.
You look at a 21 dB dynamic range improvement‑‑you double your
outdoor distance about every six dB, so if you just run that map out, starting
with 1, 000 feet, you'll come out just under two miles. So, sure enough, it's
exactly where it should be.
And that's all just the foundation of our d2d transceiver, which is why I'm
very excited to be rolling these programs along a parallel. I think, for
ParkerVision, continuing to demonstrate great products that people can pick off
the shelf, take home, and go, "Oh! I love this product!" and then,
going to the OEMs and saying, "How would you like to incorporate that same
goodness, or some piece of it, into your products, and make it easy for people
to do this?" I think is a winning combination.
Amir Ecker: Yeah, no doubt. So then, when
you do incorporate the power amp in the design, nine months later or whenever,
what will be the additional advantage?
Jeff Parker: On the transmit side, we'll
probably pick up another six or seven dB of power, which will give us another
doubling of distance. You might say to me: "Jeff, hey, come on. A couple
miles. Enough is enough."
We don't always necessarily do the best job of communicating the outdoor
distance story versus what you're trying to do with an indoor environment
product. So, the reason it's always helpful to just have more horsepower in
your transceiver, whether it's on the transmit side or better receiver
sensitivity, you just never know where consumers are going to take these
products.
I've been in homes that I would've loved to have had more transmit power, more
receiver sensitivity. They've had rooms that have been added on that used to
have outside walls that are inside walls. They've got metal, foil sheathing
inside the walls because it was an outside wall, and it's very hard to get
through. I mean, all sorts of things you run into.
And so, the promise of wireless, and what consumers expect in wireless is they
want to take that product and they want it to work like magic, which is that it
works any place they want to use it. So, people ask me, "How much distance
is enough?" And the answer is: there's never enough.
Amir Ecker: Never enough. Just going
back. The gentleman from Arbor was talking about [inaudible].
Jeff Parker: Yeah.
Amir Ecker: Are there any benefits that
can be obtained by using compound silicon?
Jeff Parker: The answer is probably yes,
but probably not in the particular product category we're talking about...
Amir Ecker: High volume, where cost is...
Jeff Parker: Right. High volume, where
cost is paramount, where people still want to move the performance advantage
higher, where size is of a concern, where battery life is a concern‑CIGI
and CMOS are absolutely the best solution.
When you're talking about things like infrastructure products, like base
stations, where network providers are spending sometimes‑‑I was
looking at some statistics recently‑‑$2‑3,000 a month on
power, to power these base stations. Would a power‑saving architecture,
that obviously could pay for itself in relatively short order, be something
interesting to them? Probably. It's just not our focus right now. We just don't
have the bandwidth at this moment in time to take a look at that.
But that could be down the road, or it may be a collaborative effort with
somebody who reads this press release or hears more things as we talk to other
parts of a company that they are part of and they say "hey, let's go
explore that together." But the foundation of the technology really is how
do you achieve high degrees of linearity in a power amplifier in a digital
architecture and there's a lot of work that's been done out there, in doing all
sorts of predistortion things where you can predistort the signal etc, putting
in DSTs to do that, etc. We eliminate any need for all of that stuff.
Amir Ecker: So are chips in this DTA
family‑I don't know what the extent of the product line is and how the
family‑what the different specs are for different part members but do you
have that today?
Jeff Parker: What we've actually got today
is‑‑once we completed the‑‑once we completed our
digital transceiver technology which you know is fielded with all the products
that we're currently selling, we started taking subsystems‑‑prototype
subsystems out of that‑‑and said how can we apply that, start
extending our reach with what we can do with RF and once we got those subsystems
to combine the way we wanted them to combine and do what we wanted to do and
verify the performance we said 'ah, this is exactly what we've been looking
for.' And now we committed that to the next level of integration and that's
what's going to be coming to customers as samples later in the second quarter.
Amir: So you actually have
silicon?
Jeff Parker: We have subsystems.
Amir Ecker: You have like a point circuit
board?
Jeff Parker: Yeah, because we don't want
to expose‑we don't want to expose the architecture right now but we can
sit down with OEMs, ODMs right now and say 'here's the way form in, here's the
way form out'. Here's the efficiency, here's the power consumption. We can give
them every spec they're looking for.
Amir Ecker: And when do you think you
would have‑what's it going to take? Six months before you actually have
silicon?
Jeff Parker: No, I think it will be late
in the second quarter.
Amir Ecker: Oh, by then?
Jeff Parker: Yep. And that's because we're
so familiar with the process that it's going to run on. I mean we've now run on
research wafers, many many wafer runs on the TI process that we use. We're very
comfortable with it and we know exactly how long it takes to run and come back
and we're pretty confident that by the end of the second quarter people will be
getting samples from us. That's why we're out soliciting this now. I mean if
you kind of look at the way these things work, people start talking about this
thing a year in advance and customers start getting in a dialogue with them.
In our case we wanted to make sure there was no anything, no stone unturned on
our ability to deliver on every performance metric that we said we would. I
think the company frankly has a very good track record of being able to say
"look we predict our technology does X and it does exactly that."
Amir Ecker: So do you anticipate the
first real application would be in cell phone or are there other applications
that....
Jeff Parker: I'm hoping we find fruit at
various levels, right. I think maybe the lower hanging fruit might very well be
in the WiFi space where I see in that space designs changing more rapidly. We
will probably have even more comprehensive solutions in the WiFi space because
of our relationships with some of the base companies and I'd ask you to keep
your eyes and ears open for that. So I think some of the lower hanging fruit
may very well be how we can help people improve their WiFi products pretty
quick and maybe that results in later this year in chip shipment. Hand set design
times are longer, the cycles are longer and that's why we need to get in front
of those guys right now and I think that's a higher hanging thing but of course
the volumes can be enormous.
Amir Ecker: Excellent. That's quite
exciting.
Jeff Parker: Thank you very much.
Ann Marie: And your next question comes
from Peter Conrad, of KOPP. Please proceed.
Peter Conrad: Hello. Thanks for the
question.
Jeff Parker: Sure.
Peter Conrad: I apologize; I had to jump
off for a moment, onto another call, so maybe you've answered this. But I just
need to better understand; if the big opportunity really is addressing the OEMs
and the ODMs with components and modules, why detract from that focus with
continuation down the path of creating your own end products and trying to work
those channels and create those channels and really proliferate in that
fashion?
Jeff Parker: Here, you know, right now,
we've got a momentum there. And, we have the momentum, and, I mean, we have
more retailers now that want to take the products on. And, we're in the middle
of dialogue with quite a few buyers who are interested in, of course, in the
Stone line. New buyers who want to look at putting in the Wi Fi products.
It's actually been extremely encouraging to me to see the credibility of having
products on the shelf and consumers ‑ you know, taking them off the shelf
every day and, and, and, liking them ‑ what that's brought to us.
So, I think, for the foreseeable future, you know, as long as the company keeps
its ‑ you know, we're not trying to, to become, you know, a major, you
know, huge line, you know, consumer electronics products company. But, I think
we can do very well if we kind of stay in the target niche. And, we continue
to, you know, push our advantages forward.
And, I think it leads to dialogue with OEMs and ODMs in a way that has a real
position of knowledge. I mean, we really, really understand what consumers are
looking for in the next generation of Lifeline products. And, we are, we are
really going to learn a lot about what the consumers like in the course, as
well.
So, I understand your question and, I think, you know, we'll have to continue
to assess that longer term. But, it's brought a tremendous amount of value to,
to us.
And, frankly, I think the number of the retailers and the borrowers who are now
starting to look at the ‑ picking up our products. When they see
announcements like this, you know, they view ParkerVision as much more than a
Wi Fi product. They view us as a real technology company. And, I think that
gets them even more excited about doing business with us.
Peter Conrad: Well, and I, I ‑
certainly, I appreciate that that angle, and, and, the need to have a system
understanding. Doesn't it, at some point, become a hindrance, though, if you,
you know, can be viewed as a competitor, and, if indeed, you are successful in
your endeavors there?
Jeff Parker: And, and, that's absolutely
why we should continue to, you know, to assess that position, you know, every,
you know ‑ frequently. And, and, we will definitely do that.
And, you know, it's ‑ we could be definitely in a worse place than to
have large influential customers telling us that they'd love to embrace
everything we can provide them ‑ that they don't want to compete against
us on the shelf.
Peter Conrad: Right.
Jeff Parker: That could result in two
things. You could have the result of us saying ‑ Great. You take that
category and run forward with it. And, all we want you to do is to put us in
the lion's share of what you build. And, we could say ‑Well, we won't be
in that product category. Or, we could say ‑ Hey, let's just stay in
products that are some of the more emerging and niche‑y products that
continue to keep us visible to consumers. And, we continue to learn and we
don't have to spend a lot of money doing that. They may have a lot of value.
The other thing about the, the power amplifier that I'll mention that I think
is very interesting is ‑ we can take that product and do with it the same
thing we're hoping the OEMs do which is to profit and enlist the products and
improve them pretty quick.
So, for ParkerVision to go to ODMs and say ‑hey, you know, we want to
take that media there and make it work the way it should is a much lower hurdle
to do than to design, I think, from scratch. So, we can, we can leverage our
own cooking in certain niche applications, if we so desire.
But, I understand what you're asking and I, as an investor myself, watched
Qualcomm get into the handset business and get out of the handset business.
Peter Conrad: Yeah.
Jeff Parker: So, who knows? We'll see.
Peter Conrad: Exactly. And, and, you're ‑
you know, I think you'll probably agree, you're not exactly flush with
resources at this point.
Jeff Parker: You know, nobody ever is, you
know. I appreciate that.
Peter Conrad: All right. Thank you.
Jeff Parker: Thanks, Peter.
Ann Marie: Once again, ladies and
gentlemen ‑ as a reminder, if you wish to ask a question, the command is
*One. And, your next person comes from Barry Rugger of ETE. Please proceed.
Barry Rugger: Hi, Jeff. How are you?
Jeff Parker: Fine. Thank you.
Barry Rugger: I'll jump in with the
gratuitous plug on the Single Max product line. We use it and it works
wonderfully.
Jeff Parker: Well, thank you. I appreciate
that. I always love to hear that.
Barry Rugger: A lot of questions have been
answered ‑ but, when you think about the availability of the product of,
like, Q2. What, what is the capacity RAM that's available to you? You're targeting
some fairly high volume products and if this works as well as we, as, as the
Single Max works and, and, designers put it into place ‑ it's clear
you're going to use some pretty significant capacity levels, too.
Jeff Parker: Well, I think that the way
that's going to go is ‑ when we get serious customers who have real
volume, it's going to be a negotiation with three parties. It's going to be
ourselves, it's going to be our customer and it's going to be our fab. As an
example, in our TI relationship, right in that relationship there's an
agreement that as we need to queue capacity that they'll come to the table in
good faith and they'll help do that with us as they would for their own
customers. In any fab relationship we're going to have we're going to need to
do that because we don't control the manufacturing because we don't own a fab.
I don't think that's any different really than any fabless semiconductor
company would do. Which is you get the fab involved in the dialogue with the
customer at the appropriate time. Now, as soon as we see buying signals that's
the appropriate time.
Barry Rugger: OK. One more question just
related to the current product line on the prior question. You've kind of
intimated in the past that your current products are basically out there to try
to prove technology and how it works in the marketplace and get it introduced
to the consumers and even the industry supply chain. Do you plan on doing that
with your power amps in your general business going forward?
Jeff Parker: Well, we will definitely take
the power amps and integrate them into the current product roadmap that we've
already laid out. I mean for us to deliver the best WiFi products starting with
G which we'll start fielding in the second quarter and then improvements to
even those G products later in the year and N products early next year. Our
power amplifiers makes all the things we want to give people easier, much
easier. So we'll definitely eat our own cooking there.
Would we go off and go into completely new product categories that we have no
plans to do with this power amplifier product? My expectation is that we're
going to find a ton of interest in the power amplifier with OEMs and ODMs and
that we're going to be so busy helping them design some of their products that
that's where we're going to be focused. So, yes, we'll use them in the products
we've already got planned in those product categories. Don't think that we're
going to probably look at changing the course of the finished goods business
into perhaps completely new categories just because we have the power amp.
Let's go get the OEMs to start embracing this and work that wonderful leverage
point financially as a fabless semi company.
Barry Rugger: Great. Thanks for answering
the question. Good luck.
Jeff Parker: Thanks.
Ann Marie: And your next question comes
from George Walker of Wachovia Securities. Please proceed.
George: Hi, Jeff. This is Mack.
Jeff Parker: Hi, Mack. How are you?
George Walker: Good.
Jeff Parker: Good.
George Walker: My question doesn't relate to
today's announcement specifically so much as over the last five or six years
you've had many important announcements with today's by far the most important.
During this entire time we've never had any mention ever in the Wall Street
Journal, except for a little quip on PVGV one time. Can you tell me what's
being done to change this?
Jeff Parker: Yes, I can. We have engaged a
PR firm now that I think will be a very great relationship for the company.
This is a new relationship and one that I think the company is primed for and I
think will be a lot of fun to work with and very effective. Just today, by the
way, we got a call from that very journal, and I hope you'll see us mentioned
there tomorrow. So, we'll see.
George Walker: OK.
Jeff Parker: Mack, I will tell I have
never been more confident or comfortable in sitting down with mainstream press
and explain to them the importance of what we're doing and why it's going to be
successful. So I'm welcoming those opportunities with open arms and
aggressively pursuing them.
George Walker: Thank you.
Jeff Parker: Thanks.
Ann Marie: And if there are no further
questions at this time I'd like to turn our presentation back to Mr. Parker for
any closing remarks.
Jeff Parker: OK. Well, folks appreciate
your time and your interest and the great support that we get from many of you.
I know many of you have been shareholders for multiple years now and we are
grateful to that. We hope that we will continue to earn your trust and respect
and support and that the next coming two, four and six quarters will continue
to get ever more exciting for ParkerVision as we can demonstrate that we turn
our enthusiasm to the technology and the products we announced today into
designed ones and into real revenue.
So have a great weekend and thank you again so much for participating. Bye‑bye.
Ann Marie: Thanks for your
participation in today's conference. This does conclude the presentation. You
may now disconnect.