ParkerVision 2005 FBR 9th Annual Growth Investor Converence
June 1, 2005
Jeff Parker
Jeff Parker: It's nice to be here. I
appreciate the opportunity to tell you a little bit about our company and where
we are at with our business plans, so let me wait here while just a couple more
people are filing in the room and sitting down.
Great. So I'm going to walk you through today in the little bit of time that
we've got and tell you a little bit of our background and where we came from
and how we got where we are. I'm going to introduce you to the latest
technology that the company is bringing to market, which we call Direct to RF
Power, or G to P Technology and how that technology has been crafted to go into
cell phones. I'll walk you through a little bit of products that are under
development for that market space, also walk you through the same technology as
it applies to the WiFi, wireless networking space, and then open it up for
questions that you might have.
As you probably already know, we are a publicly traded NASDAQ company, we are
based in North Florida in
The mission for our company is, we have really developed a skill in our company
for how we look at old legacy analog RF processes and are able to create new
processes for those same RF signals that can end up in highly efficient digital
circuits and digital chips.
Just a quick commentary on RF transceivers and RF technology today: we get
excited about the ability to create new architectures for radio transceivers,
because if you think about it, wireless communications and especially mobile
wireless products today are some of the most advanced products and yet if you
look at the analog circuit architectures that they're using, those are some of
the oldest architectures that exist in terms of when they were invented and how
they were employed.
So the mixers and the local oscillators and the engines of our products today
were created back almost a hundred years ago, and yet that's the foundation for
the products that are some of the most advanced wireless products in the world
today.
We were founded in 1990. We started out as a robotic camera company. We ended
up creating tracking cameras that can follow subjects without any camera
operator. You would wear a little [xx] microphone that had a wireless radio
beacon in it. That's how we got into RF and we ended up starting to use those
cameras in video conferencing, distance education, ultimately in broadcast
television network.
We have a little over 100 employees in our company today, we're as I say are
publicly traded on NASDAQ, and we've invested a little bit over $100, 000, 000
to develop the technology that I'm going to show you here in just a moment.
We basically decided to focus our company exclusively on being a wireless
technology provider last year, and sold our broadcast equipment business to
Thompson, where they got everything in the broadcast business except for the
wireless.
Today we are a bit vertically integrated in that we make wireless transceivers
that have been created specifically for networking products. You can go to
certain stores today and find our wireless routers, our wireless network cards,
USB products. You see them on the shelf under the brand of ParkerVision and Signal
MAX and what they sport as their benefit to the consumer is improved coverage
and better connectivity, especially for consumers that are trying to connect
into DSL and cable modems.
You'd see our advertising where we're guaranteeing entire home coverage, better
performance than other networking cards on the market today. We're known by
many as having a one‑mile link in an outdoor environment with no
obstructions, which gives us the opportunity to guarantee full coverage in the
home.
And you see us today in places like CompUSA, J&R, RSC, Microcenter‑‑more
of your specialty consumer electronics and computer centers. We've gotten a lot
of nice reviews‑‑dozens, maybe hundreds now‑‑from
various reviewers who have tested the technology and said 'yeah, they've got
greater range than other cards that we've been able to find. Yes, it covers an
entire house.'
This magazine took us up on our one‑mile distance claim and they actually
ended up getting 1.4 miles and they were like, 'wow, yeah, that really does
what the company says it does' which in the wireless world it's not uncommon to
be kind of surprising. People make lots of claims in wireless that they don't
meet. This reviewer even hooked it up to an Xbox live, which can be a
challenging application in terms of reliability and it worked very well.
But the company has evolved and I think for the foreseeable future what you'll
see the company trending toward is becoming an OEM supplier. That's really been
our goal and our dream. I think the company is on the threshold of making that
happen. We've evolved our technology into what we call direct to RF Power
components. Those components, as I mentioned earlier, have been developed for
cell phone hand sets, embedded WiFi products and convergence products‑‑products
where people are trying to put more than one standard or more than one
application into the same product.
What is direct to RF Power? It is a very unique architecture that allows us to
create very efficient radio carriers‑‑in other words, transmitted
RF Power. It allows us to convert any analog or digital data stream directly
from that data in a single operation to the RF carrier at power.
It's very unique and I'll show you some diagrams of this. It's implemented in
digital circuits that are very small, highly compact and we end up being able
to build very small chips that replace quite a bit of circuitry which I'll
showcase to you in a couple of applications, what kind of size our technology
goes into versus what it's replacing.
So here's a block diagram that today you'd see in a direct conversion
architecture in a cell phone and what you'll see here‑‑if you
follow the base band processor on the right‑‑it's putting data out
going to a transmitter, which then goes through a filter, which then goes
through a traditional analog power amplifier and then through the antenna.
We've changed that architecture from those steps to look like that. So we
basically take the transmitter and eliminate it, we take the filter and
eliminate it, we take the analog power amplifier and eliminate that. It all
gets replaced by a small, what we call direct to power chip, which I'll show
you in a moment. These chips are being fabbed at IBM and their silicone
germanium process.
The chips are being fabbed as both single band chips and multiband chips,
depending on what our OEM customers are interested in. They are also single
mode capable or multimode capable. Now when I say multimode that means a single
chip that can handle CDMA, wide band CDMA, GSM, GPRS, EDGE, WiFi‑‑
literally any data stream and turn it into the right carrier at the right
frequency at the right power.
So let me give you some examples of what this particular offering does. If you
were to look inside a cell phone application and you were an OEM, the things
that you're really interested in are what do you do for my power consumption,
what do you do for the cost of my product, how do you help me on size because
I'm trying to pack more features in there and by the way, do you help or hinder
my time to market?
Here's a block diagram of a typical cell phone. What you see today in cell
phones are really three levels of integration. A low level of integration, what
we're showing you here, is where you have multiple chips to get to the
transmitter, multiple chips for the receiver. You don't see this level of
integration too much anymore. People have definitely moved beyond this.
This level of integration where you've got a separate transmit chain from a
received chain is typically direct conversion. That's become more common. What
you'll see is you still have multiple power amplifiers, or power amplifiers
that are in modules for the transmitter and separate material. Typically
gallium arsenide versus CMOS or some kind of siggy [xx] for the RF section.
Then, you might see this level of integration, which is much higher, where the
transceiver is on a single die with the synthesizer, but even in that situation
the power amplifier is typically in a different material and a separate chip.
Typically, this level of integration you see more in two G cell phones, 2.5 G
cell phones. In this level, you'd see more in the three G. Next generation
CDMA, CDMA wideband type applications.
So what we do is we've taken a variety of handsets. These handsets here are all
three, four, five months old. These are fairly new handsets. We've done
breakdowns of what it takes to build that transmit section if you're building
an EVDO/CDMA phone, or how about a regular CDMA phone? Or a wideband CDMA
phone? Or a GSM phone?
I won't bore you with all the details on this, but if you look at this at kind
of a high level, which you'll see, is that the transmit sections take anywhere
from four and a half square centimeters, six square centimeters, four point
six, four point six, four, to build. That compares to what we do with the
direct to power chip. If you look at the transmit section of this CDMA cell
phone, we would turn that section from what you see there into that.
So, a very significant reduction. About 75% less circuit board space required
than what the traditional approach requires.
The next thing under the chart that shows you the comparison between these
different standards. In terms of component count, today, to build a transmit
section for a cell phone it's anywhere from about 75 components for a relatively
simple handset up to over 200 components for a more complex third generation
handset. You can see with ParkerVision it's in the 12 to 15 component range.
Next thing would be cost. And again, if you walk through these phones, you'll
see that cost varies from about five dollars and change to about ten dollars
and change, depending upon the handset. If you get to our solution, you'll see
that we're in the two and a half to maybe a bit over four‑dollar range,
depending on how many bands of operation and how many different modes an OEM
would want.
Now we get down to power consumption. This particular part, we are focused on
showcasing CDMA, and we'll add to this presentation GSM and some other
standards. But CDMA and wideband CDMA are definitely the least efficient modes
for handsets today.
The reason for that is the modulation of a CDMA or a wideband CDMA cell phone
is a very complex modulation. The analog power amplifiers don't track that very
well. So, what you see on a CDMA phone here is when that phone is putting out
17 dBm of power, which is 540 milliwatts, which is where it runs most of its
time, it's only four to five percent efficient. So, 95 percent of the power
that you're consuming for that transmit section is going up in heat, and only
four of five percent of that's coming out the antenna.
And what we do for that is we take that up to 22 to 26 percent efficiency,
which is a huge increase in efficiency, as you can see on this chart: a
traditional power amplifier and its transmitter running about six percent. What
we're showing there at 10 percent is what people are talking about doing with
next‑generation analog power amplifiers. They're hoping to pick up three
or four percent. And we, with our first generation on Direct2Power are in the
22 percent range if you're using an analog interface and almost 27 percent if
you're using the digital.
So if you translate that to actual power consumed, on the right‑hand side
of this chart, you'll see they're consuming anywhere from three‑quarters
of a watt to close to a watt, and we're consuming around two‑tenths of a
watt. And what that translates to, by the way, is 40 to 50 percent less power
consumption of the battery, of the whole product. So you can almost double your
talk time, just by improving the transmit section to this degree.
This chart here is showing you what happens when this handset runs at full
power, which it doesn't do that often. But when it does, what you'll see is
that the traditional analog amplifiers are running at about 30‑32 percent
efficient.
The problem with that is that's a theoretical number, and so, to get a
manufacturing margin in there, you have to do what's called "back
off." And when you back off of that power amplifier to get manufacturing
margin, you're really only running about 20‑25 percent efficient. We're
running at 50 percent efficient, and we have no back‑off. And we have no
back‑off because we don't put RF in to get RF out; it's data in. So we
don't have the same kind of manufacturing back‑off requirement on this type
of an architecture.
What the chart's showing on the far right is OEMs say to us, "Have you
guys squeezed the last efficiency percentages out of your technology?" And
the answer is: "Oh, not even close." I mean, this architecture has a
lot of improvements that we will make over time. And we predict, over the next
18 months or so, that we can actually push those efficiencies into the 70
percentile, maybe even close to 80 percentile, efficiency range. So there's a
lot of gains yet to be had with this technology.
I won't bore you with this chart, but this just shows you, if you were to
benchmark us against some of the power amplifiers that are commonly found on
the market, how do we look? And we look very good, especially as you start
looking at those back‑off numbers. They're down to only about 20 percent
efficient.
So, at this point of a presentation, an OEM would say to us, "There's
nothing I don't like, so there must be something I'm not going to like. It must
be, maybe, in your performance of what the waveform looks like or what the
spectrum of your transmitter looks like." And so, these numbers here are
basically showing you the way, especially on CDMA, the spectrum is measured is
in what's called ACPR one and ACPR 2.
These are the first and second side lobes that a spectrum that's regrowth from
your transmitter is undesired spectrum. And the perfect spectral regrowth on
side lobe one would be ‑100 DBC. Nobody gets there today, including us.
The spec calls for ‑40. And the second side lobe, the spec calls for ‑50.
What you'll see is that we are six to seven DBC more margin than what the spec
calls for, worst case. And more typical, we're 10 DBC better, which is plenty
of manufacturing margin.
We show you different power amplifiers here and how we stack up against those,
and what you'll see is we're right in there with the best class of power
amplifiers on the market today. So there's nothing not to like. The one thing
that is notable about our performance, though: as you'll see, we run our power
amplifier at 3.3 volts to get 28.5 dBm out. Our competition has to run at 3.4
to 3.5 volts. And that's just another showcase of why we're more efficient.
This slide here is showing that we are an easier component to design into a
handset. Today, a handset, when you put a power amplifier in, you have to do
what's called "matching components, " for RF in and RF out. We only
have matching components on the RF out portion, because we don't have RF in;
it's data in. So, RF designers like that, and that makes it a little easier for
them to get their product designs in time to market.
This is just a chart here that showcases that we save a lot of size, a
significant amount of cost, obviously excellent power‑consumption
savings, and we help in time to market. So we would basically showcase that we
think we've hit a sweet spot with what people are looking for in this part of
their handset puzzle.
Here's a couple of chips that are coming out in the second half of this year.
This chip is a platform chip. And what it shows you is that you take the
frequency from the synthesizer, which is what sets the channel on a handset,
and you take the standard synthesizer and you put it into this chip. You then
have a couple of pins that can select whether this is going to output channel
one, two, three...
In other words, it has four bands in this one chip. So, two PCS bands, a cell
band, and then a fourth band, which is provided for people who may want to do a
WiFi or a Bluetooth. And then you put in any analog or digital IQ signal, and
this chip will process that. And here's the size of the chip, which is a five
by five millimeter, which is very small. And here's the pin‑out, which I
won't bore you with, but obviously designers are interested in that.
And then here's a single band chip, for a person that just wants something
that's extremely limited and the least expensive thing we can build. It's a
four by four millimeter package, so, very efficient. Same kind of thing.
Today, the company is now in dialog with a number of OEMs, especially handset
OEMs. We've gotten very positive reception to the technology and to the
products that we're doing.
We're starting up the demonstrations now to OEMs. They hear the story you've
just heard, and the next thing, inevitably, they say is, "Hey, show me. If
it's this good, I want to see it." And we have a demo platform we've
created that lets them literally put in anything‑‑CDMA, wideband
CDMA, GSM, anything‑‑and out the other side of this platform comes
the desired carrier with the specs I just showed you.
We hope to be able to sample fully integrated chips to these OEMs a little
later in the third quarter. Probably in the August‑September time frame
is our belief right now. We seem to be tracking on that right at this moment.
And then, pre‑production samples a little later in this year, and
hopefully securing design wins with certain OEMs and starting up production
with them, probably not late this year. I think, by the time you get through
the design‑win process and the contract process, it probably looks more
like the first part of next year.
We also have this offering crafted for WiFi because, as I said, it's agnostic
to what kind of data goes in, I'm not going to spend a lot of time on this,
other than to showcase it's the same story. You take multiple components: you
replace them with a direct‑to‑power chip, which could be using
someone else's receiver, or our own receiver, because we've already got a
receiver for WiFi.
Our cost story here is a little different. WiFi transceiver costs are already
pretty efficient. We're in that $1.75 to $2.50 range for the transceiver chain.
You can see those transceiver chains today in about the same ballpark. Where I
think we bring a lot of value to the WiFi space is we don't require any shields
at all in our transceiver products‑‑never have. And we also provide
a lot more efficiency.
So it's the same story as the cell phone handset. Today, an 802.11G transmit
chain is only about six or seven percent efficient. We're running up in the 20
percent range, which is significant. And in WiFi, we have the opportunity to
bring more power. You can't find, today on the market, WiFi power amps that are
more than about 18 dBm, 17 dBm, output power. So that limits the range.
In the FCC specs, you can run a WiFi node up to 30 dBm, up to a watt. And
today, people are only running about 60 milliwatts. So, as you can see from our
chart here, we have chips that will be coming out that actually allow you to go
all the way up to a watt on.11b, and up to 27 dBm, which is half a watt,
on.11g. And the benefit to that is it allows you to have much better distances,
just by including our power amplifier technology. You don't have to change
anything else out in your system, and you'd get two to four times the distance
on your WiFi products.
We're also discussing with OEMs their interest in putting a single‑chip
solution together for WiFi for handsets. You're probably reading more and more
in the market about people including WiFi in, especially, smartphones, and we
think there's a real market for that over the next three or four years.
We already, today, have our own transceiver, synthesizer. Obviously, now, we
have our own power amplifier technology. And so we're in the discussions with
handset OEMs about putting together a single package for all that for their
handsets.
There's a lot of interest in that, because what we would end up bringing to
them is much more distance at the same power consumption they use today, or
making much less power‑consumption and getting the same distance. And
again, if you're working in a handset environment, you don't have a lot of
battery to work with, so they're always looking for, "How am I going to
add these features without having more battery consumed?"
The other offering of the company as we're out talking to OEMs is, as you know,
we're through the retail space, already selling WiFi products. So we have
started to engage OEMs in dialog about using our chips in their WiFi products.
And what we talk to OEMs about is: here's a chart that shows our 802.11b
products.
The first area here you see, on the left, is the typical distance that is
achieved with today's analog transceivers. That blue line which goes out to
about 6, 000 feet is what we actually get in open field environments. If you
just used a ParkerVision transceiver on one end of a network, you would more
than double the distance, even if you were using someone else's analog
transceiver on the other end.
And then we've been working to bring to market our 802.11g product, which we're
getting very close to. And if you'll look at this chart here, what you'll see
is, all of these‑‑the yellow, red, purple lines‑‑that's
today's 802.11g products, which typically, in an open field, are going to get
you 1, 000 feet, maybe 1, 500 feet. The purple line there that goes out to 2,
000‑plus feet is actually the MIMO products that are on the market today,
with the multiple antenna schemes.
And this brown line that you see that goes all the way out to 6, 000 feet is
our 802.11g product, which, as you can see, keeps 10 megabits all the way out
to a couple thousand feet. The reason we think OEMs will find this interesting
is there's a real trend in the market today: "How am I going to use WiFi
to move video around my house, or audio?" Media nodes. Multimedia applications.
And what you really need in an indoor environment is you need about 10 to 12
megabits for video, or more, and you want that at the longest distance you can
get.
The dotted brown line that you see there is our prediction that if you were to
use our direct‑to‑power chip, with its extra power output, that's
what you could do to that g line. You could take that 10 to 12 megabits all the
way out to about 4000 ft.
And, some of the conversations we've had with OEMs and ODMs have been a lot of
interest in this. Because, as I say, they're struggling today to figure out how
to move multimedia around. And, currently, the industry has been trending to
this MIMO solution, but it's expensive and it's complicated. And this shows
them that there's another way to do that.
By the way, the direct‑to‑power chips are also very applicable to
MIMO applications. So, there's a lot of different ways that we think Parker
Vision can be a resource to the OEM marketplace.
The company has spent a lot of time securing its intellectual property. We use
a firm in
We think that the technology's protection through IP is ultimately going to be
very important. And, so we spend a lot of time and effort, and dollars on
making sure that the patents are going to cover and protect our intellectual
property from a lot of different angles.
So, that's basically a quick walk‑through through the Parker Vision
Company. And, I'd be glad to answer questions that, that you might have.
Yes, sir.
[Audience question]
Right.
[Audience question]
The company's focus has always, and the belief has always been, that the best
leverage point for this technology is within the OEM, it is to become an OEM
provider.
When we brought to market our direct‑to‑data chips a couple of
years ago, we were hoping to get OEM traction then. And, you know, we can
speculate and talk a little bit about why we didn't traction with our direct‑to‑data
transceivers. In my opinion, we were asking the industry to swallow a sandwich
in one bite. Our direct‑to‑data transceivers, which kind of sit at
the heart of the system, make you change an awful lot around what we put in
there ‑ to adopt us.
We decided that when we were having difficulty getting adoption with the
transceiver, that we needed to prove that we could bring this technology to
market that it was stable that we could manufacture it ‑ that it would do
what we said it would do.
I think we've done that. And, frankly, it's gained us a lot of respect with
some of the OEMs we're talking to. I mean, a number of them have gone out and
bought the product and put it into their own homes, and said, yeah, the product
does what you say it does.
The reason we've evolved to this direct‑to‑power technology is,
once we saw the resistance at the OEM level, we said, what do we need to do to
this technology to make it an easier adoption curve for the OEM? And, so, it's
no accident that this technology fits into their platform without asking them
to change what they do. We use their standard data that comes out of their
processors. We use the synthesizer the way it comes out of their synthesizer.
The only thing we ask them to do is to eliminate a bunch of parts, which
frankly has been, so far, very well received.
So, I believe where we are at today as a company is we are finding our way back
to where we wanted to be a couple of years ago which is to become a real asset
and resource and a trusted provider to the kind of OEMs that can make this
company cash flow positive and profitable.
When will we get our first design wins? That is really is now probably the
question in your head. And whatever I predict, I'm sure I'll be wrong, [laughs]
so I hate to give you a date with a projection on it. But I can tell you that
the company is in dialog with a number of OEMs in both the handset and the WiFi
space.
And the reaction we've gotten to our direct‑to‑RF‑power chips
thus far has been extremely different‑‑much more positive, much
less skeptical, much more welcoming‑‑than we got on our Direct to
Data transceivers. So I think we're finding our way back to where we wanted to
be as a company, and I believe that you'll see design wins from the company
with significant names in the industry. And once we do that, of course, then I
think the company is on the right track to building the kind of revenue that
you would expect out of a $100 million investment.
Yes, sir?
[Audience member speaks off‑microphone]
Jeff Parker: At this moment, we haven't
seen anybody in the market who actually has hardware that does what I
described, that takes you from a data signal right to an RF power carrier with
no transmitter. So that's a unique offering. There have been people out there talking
about doing that, but they've all been using architectures... by the way,
that's known as a polar architecture. And we actually cite polar architectures
in our patent applications.
There's a lot of reasons why polar architectures aren't on the market today. If
you're trying to do CDMA cell phones, wideband CDMA cell phones, or OFDM WiFi,
which is.11g and ultimately.11n, I don't believe you're going to do that with a
polar architecture. So I think we have found a very unique and well‑protected
way of doing what people have been thinking about doing, but nobody has been
able to achieve to date, in terms of on the transmit side.
In terms of, are we behind the eight ball in finding OEM adoption? So far, the
OEMs we've talked to have said to us, "We haven't seen anything like it.
If it does what you say it does..." I mean, these guys are designing their
next‑generation handset platforms all the time. Depending upon what
company you're talking to, you're going to run into OEMs who are in various
stages of how they get ready to do their next cell phone platforms.
But at this point, the reaction we've gotten from OEMs has been: "Show us
that the technology works for your demonstration platform, and we're ready to
talk about how to do business." I haven't heard from OEMs, any of the
names that you mentioned of the traditional power amplifier providers, having
anything like this.
Yes, sir?
Audience Member: Assuming you got a design
win, how long would it be from getting the win to actually a lead time to getting
it into production?
Jeff Parker: In the handset market, from
the time you get a design win to the time it's a production item, typically is
about 12 months. In the WiFi space, the design win to the production is a lot
shorter‑‑shorter being maybe four to six months. The difference, of
course, being when someone designs you into handset, it's usually you're going
to be designed as a platform, right? You're going to be designed into some
platform which is going to be creating 10 or 12 or 15 different models of
handsets.
So, typically, although the handset design end‑time takes longer, you're
also talking about much, much larger volumes. And with the WiFi space, although
it's much quicker, the volumes are typically a lot less. So those are kind of
the trade‑offs that we see.
Yes?
[Audience member speaks off‑microphone]
Jeff Parker: OK. Great. Thank you, guys,
for your attendance, and we appreciate the opportunity to tell our story.