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Our sales and marketing organization includes four field applications engineers that assist customers in designing, testing and qualifying system designs that incorporate our integrated circuits and software products. We believe that the depth and quality of this design support are key to cyberpro 5355 our customers' time to market and maintaining a high level of customer satisfaction. Both of these sales offices also provide hardware and software applications support.

Our research and development efforts are focused on three areas: device architecture and logic design, cyberpro 5355 layer design software development and device testing. As of March 31,our research and development staff consisted of 52 employees.

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Our research and development efforts have been focused on architecture design, streaming media processing modes, high speed digital and mixed signal design and software. On a new product, the majority of our hardware engineers are cyberpro 5355 in high speed digital and mixed signal designs and verification. Research and development expenses consist mainly of personnel and other costs associated with the development of product designs, process technology, software and programming hardware.

We anticipate that we will continue to commit cyberpro 5355 resources to research and development in the future. We have adopted a fabless semiconductor manufacturing model and we outsource all of our semiconductor manufacturing and assembly. This approach allows us to focus our resources on the design, development, testing and marketing of our products and significantly reduces our capital requirements. This allows us to shift production from one facility to the other in the event of a capacity constraint at one foundry. We currently use 0. We intend to use 0. We internally design and optimize digital and analog cells through our physical layer design group.

This allows us to reduce the size of the semiconductor and therefore the cost. This also gives us greater control over the quality and reliability of our streaming media gateway integrated circuits. Final testing is primarily performed by us in Santa Clara, California.

However, we are currently exploring additional outsourcing of the testing function. The semiconductor industry in general, and the market for integrated circuits for Cyberpro 5355 appliances, broadband set-top boxes and digital televisions, in particular, is highly competitive.

We believe we compete favorably in each of the key competitive factors in our target markets. These factors are:. In addition to these competitors, we expect other major semiconductor manufacturers will enter the market as the Internet appliance, broadband set-top box and digital television markets develop. A number of companies, including IBM, STMicroelectronics, National Semiconductor and TeleCruz, have announced that they are developing or plan to introduce competing products in the Cyberpro 5355 appliance, broadband set-top box or digital television market which could result in significant competition.

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We expect competition to intensify as current competitors expand their product offerings and new competitors enter the market. We rely on a combination of patent, copyright, trademark and trade secret laws and contractual restrictions to establish and protect our intellectual property and proprietary rights that we develop and license from others. We have filed applications for United States patents containing claims covering various aspects of combining digital streams of video and graphics for presentation on an output display and for changing the size of graphic data for presentation on a television output display.

We expect to file patent applications as we deem appropriate to protect our technology and products. We cannot be sure that our patent applications will result in the issuance of patents, or that any issued patents will provide commercially significant protection to our technology. We also license from others certain audio, graphics and semiconductor technology that cyberpro 5355 incorporated in our semiconductors and certain intellectual property rights. These licenses are perpetual and survive the termination cyberpro 5355 the agreements under which we obtained such licenses.

The protections we receive from others against infringement under the terms of these licensing agreements is limited and we cannot assure you that alternative technology exists. In Octoberwe entered into an agreement with Coreum Technology, Inc. Under the terms of the agreement Coreum may have the right to purchase 39, shares of our common stock.


The conditions that must be met before Coreum has the right to purchase the shares of common stock are discussed in the notes to our financial statements on cyberpro 5355 F In Marchwe entered into a cross license agreement with Innovative Semiconductors, Inc. Pursuant to our agreement, Innovative will license to us the right to use their proprietary cores to develop and cyberpro 5355 semiconductors and we will license to Innovative the right to use and market our cores and test benches with their products.Graphics driver for TVIA CyberPro chipsets.


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