Altair Semiconductor Inc. has raised $25 million in funding in an effort to increase its penetration of Long Term Evolution (LTE)-only chips into the end-to-end market.
The funding, which closed in March and was led by Jerusalem Global Ventures, will be used by Altair to expand its operations, sales and customer support capacity in the single mode LTE market, according to Eran Eshed, co-founder and VP of Marketing and Business development at Altair.
"The single mode LTE market is growing and Altair is capitalizing on this growth," Eshed said. "We are seeing numerous application segments and use cases that we believe we can participate in enabling [LTE] –some existing and some emerging."
LTE is a disruptive and costly technology. But as more consumers clamor for faster speeds and LTE networks increase globally, reducing the costs of the chips that enable LTE is one of the easiest way to proliferate growth and expand opportunities.
"If you look at the end-to-end market where Altair’s main business is, they are legacy devices that are going into LTE," said Wayne Lam, senior analyst for wireless communications at IHS. "This is sort of a new territory for end-to-end and a new generation of technology comes with it an additional cost. Reducing the cost down as much as possible and relying on software to run that communication stack is a good way to go about reducing the costs. That’s what Altair is doing and this is a good opportunity for them."
Eshed said that the cost of a single mode LTE module is roughly half of the equivalent multimode 3G+LTE modules due to a lower chipset, bill of materials (BOM) and intellectual property (IP) royalty cost. Recently, Altair’s single mode LTE chipset was integrated into Verizon’s Wireless Ellipsis 7 tablet, allowing Verizon to offer the tablet for free to customers with a two-year agreement or $250 outright.
Altair currently is active in any market that has LTE coverage including the U.S., Japan, China, Korea, India and Eastern and Western Europe. However, Eshed said the company believes the U.S. is a major importance to Altair because it leads the pack in LTE.