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Chipmakers hope sales of gadgets, phones and PCs will rise, in the Technology column

Those silly little MP3 players.

Scoff if you will, but handheld devices along with personal computers stand to be the savior of the troubled technology industry, according to the president of the San Jose-based Semiconductor Industry Association.

“Information technology products such as personal computers and wireless applications, combined with digital audio devices and other consumer products, will be the demand drivers that lead the (chip) industry into recovery,” said George Scalise, the trade group’s president.

Moreover, Scalise said, sales in the last three months of the year should improve from the third quarter.

But chipmakers still are swimming against the tide. They saw a 2.5% decline in September sales vs. August. But perhaps more striking is the contrast to last year’s numbers. Sales tumbled more than 44% from last September, when monthly global semiconductor sales were $18.4 billion.

Some cool technology slated to debut next year could help. New cellular networks, dubbed third generation or 3G, are set to come out next year replete with flashy new phones. After putting off purchases, big companies could be looking to replace aging PCs. And newer wireless gadgets stand to become must-haves for business travelers and tech junkies.

A look at the investments of Orange County chipmakers seems to confirm industry perceptions. Both Irvine-based Broadcom Corp. and Newport Beach-based Conexant Systems Inc., along with smaller upstarts, have focused on wireless communications as they acquire companies and bolster research spending.

For now, chipmakers face a delicate balance between cutting costs and investing for a rebound.

After all, some industry watchers thought chipmakers would be growing again by now. But cutting too much production capacity could leave chipmakers off guard when demand comes back, analysts say, resulting in shortages in 2003.


Syncata Moves

El Segundo-based systems integrator and tech consultant Syncata Corp. is relocating its Irvine office in a move the company says is designed to better handle its 58 OC employees and to make room for more business.

While tech consulting hasn’t been as good to some companies, Syncata says it’s doing OK. The company outgrew its tiny Irvine office this year and moved to a 6,300-square-foot office that’s about three times the size and is in the same area near John Wayne Airport.

The company expects its Irvine office to grow to about 75 workers in the next 12 months. In all, Syncata has 153 employees, with 65 people in El Segundo and another 20 in Oakland. Syncata has 21 consultants in India.

The new Irvine facility features the design du jour for tech consulting firms. The office has what Syncata calls a “visioning center”,a central boardroom and adjoining conference rooms.

“The layout, which was designed to accommodate the interdisciplinary strategic planning phase of systems integration, is equipped with wireless connectivity, dry-erase surfaced walls with digital capture capability and projection systems throughout,” the company said in a statement.

Syncata’s clients include J.P. Morgan Partners, Linear Technology Corp. and American Honda Motor Co.


Universal Deal

Irvine-based Universal Broadband Communications Inc. acquired some assets of Norstar Communications, also of Irvine.

“We are confident that UBC will present us with a wealth of new opportunities, including the expansion of our (voice over Internet) network,” said Mark Ellis, Norstar’s chief executive. “Norstar was built on the premise that both business and residential customers can benefit from the latest telecom technologies,financially and operationally.”

Company officials say the assets should help Universal Broadband reach its goal of creating a network that allows service providers to transport voice, data and video services around the world. Right now, Universal Broadband offers just local and nationwide long-distance and data services.


DPAC Gets Orders

Another sign of the defense upswing comes by way of Garden Grove-based DPAC Technologies Corp.

Formerly Dense Pac, DPAC said it has received large orders for its stackable memory products from several defense contractors. The deals are valued at $1.6 million.

Stackable memory products allow for more information to be stored in a smaller space by stacking memory chips on top of another. The products, according to DPAC, are used in key military programs, both domestically and abroad. The gear is set to ship during the next few quarters.

“DPAC’s technology has supported numerous military systems in the past twenty years,” said Ted Bruce, DPAC’s chief executive. “Our ceramic stackable product has been designed into highly-reliable and durable systems, where functionality and accuracy is of the utmost importance. DPAC supports many military electronic system applications and we have a meaningful presence in this market sector. We also have designs into programs for satellite surveillance applications.”

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