Chips drive next Internet boom, says Halla

Mark your calendars for June 21, 2003. On that date, the technology industry will resurrect itself, and experience a rate of growth surpassing all those before it.

That prediction is based on a homemade equation incorporating a dash of chaos theory and a spoonful of neural modelling cooked up at the request of Brian Halla, the chairman, president and chief executive officer of National Semiconductor Corp. Like other top executives speaking at the Comdex computer industry trade sho, Halla delivered a keynote presentation that was high on economic optimism.

The Internet boom has not yet occurred despite popular belief that it is already passed, he said, and the proliferation of wireless Internet, as well as computer chips built into common household devices, will help launch the next wave of growth.

"A mature business? Absolutely not," Halla said. "As an industry we've only released a couple of interesting products. We've only scratched the surface."

Driving Halla's predicted economic boom will be the utilization of the vast Internet infrastructure that has already been laid down. It will also require billions of microprocessors that allow electronic devices to consume less power and communicate with other devices wirelessly. Halla estimated that in the next few years many people will individually own hundreds to thousands of devices powered by semiconductors.

That's good news for National Semiconductor, which makes chips that power displays, wireless devices, digital cameras and appliances such as set top boxes.

Halla detailed a new chip it has produced with the help of Microsoft Corp. that it expects will be at the centre of this chip boom. Still under development, the chip could eventually feature always-on 802.11b connectivity or integrated support for ultra wide band radio, a short-range wireless technology that uses lower power than 802.11 or Bluetooth. Most importantly, Halla said these chips could be manufactured at very low costs.

"They can be embedded in virtually anything you can think of, almost for free," he said.

National Semiconductor's chip is being designed to power devices based on an initiative announced Sunday by Bill Gates, Microsoft's chairman and chief software architect, called Smart Personal Objects Technology, or SPOT. The concept is to stuff inexpensive chips into common everyday objects, such as wrist watches and alarm clocks, that allow those objects to collect information from the Internet.

Gates offered an example of an alarm clock that could self tune its time by synchronizing with an atomic clock, as well as set the alarm and deliver relevant information such as weather or traffic conditions.

"We've been working on (the chip) for a couple of years," Halla said.

Halla's predictions for a world full of computing devices based on microprocessors with integrated network connectivity hold water, according to some attendees and analysts who attended his keynote.

"I think it's an awesome idea. I think the technology is right. And, I think the time is here," said Fred Hart, a programmer with Opto 22, an industry automation manufacturing company in Temecula, California. "It's going to facilitate machine to machine connectivity. And there's billions and billions of machines that we rely on today that could use this technology to increase efficiency and reduce costs."

Tim Bajarin, president of research company Creative Strategies Inc., in Campbell, California, noted that the initiative Halla described is moving closer toward reality.

"The bottom line is the concept of building a radio chip into all these devices, and making all of the devices interconnected, is actually the way we're going," he said, noting that most semiconductor makers, including Intel Corp., are pursuing similar technologies.

"In the end we're driving toward a wireless connection pretty much to every device. That includes things we already have today, but it's eventually going to include things like alarm clock and radios," Bajarin said.

With the announcement of the new chip set under development, Halla reiterated his theory that the IT industry is headed toward yet another economic boom in the near future. He compared the recent boom and bust of the Internet to the build out of the railroads in the late 19th century.

A glut followed the railroad boom, but it was followed by another wave of unprecedented growth as people began to come up with new ideas to make use of the foundation that had been laid, he explained.

"We overbuild; we have a glut. That's where we are today. The period that follows after the glut is when the new ideas get incubated," he said.

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