Intel said the deal will give it access to a new chipset which can be used in a modem that supports both DSL and analog connection capabilities. Offering consumers a modem with dual capability will help assure a smooth transition as the world shifts gradually to broadband Internet services, the US chip giant said in a statement.
DSL modems use existing telephone lines to provide Internet access speeds up to 150 times faster than 56Kbps analog modems, which are used by most home users to access the Web today.
Intel began selling its first DSL modem earlier this month. Like Ambient's chipsets, the Intel modem uses a DSL standard called G.Lite.
Based in Fremont, California, Ambient was formed after Cirrus Logic spun off its PC modem unit in 1998. Employees purchased the unit from Cirrus in January 1999 and formed Ambient. Under the terms of the deal announced on Thursday, which is subject to regulatory and other closing conditions, Ambient would become a wholly owned Intel subsidiary.
Ambient's engineering design centre is in Raleigh, North Carolina. The company also has offices in Taiwan and Germany.
The deal caps a busy couple of days for Intel. On Wednesday the chip maker said it plans to buy Rockwell's wafer fabrication facility in Colorado, as well as Thinkit Technologies, an Indian company that designs communications chips. The financial terms of those transactions were not disclosed.
Intel's shares on the Nasdaq stock market closed on Thursday at $114.19, up $4.16.