Broadcom Corp. rode the Apple wave for years, growing fast on sales of connectivity chips that powered Wi-Fi, GPS and Bluetooth applications for the iPhone and other devices.
Close ties to the Cupertino-based Apple Inc. played a big factor in Broadcom’s $37 billion sale last week to Avago Technologies Inc. in Singapore. The combined entity, known as Broadcom Ltd., is the third largest chipmaker in the world, with $15 billion in annual sales, and retains Apple as a top customer.
Now a new crop of locals are angling for a bite of the consumer electronics giant, which has inspired intense customer loyalty as it rolls out new devices to meet growing demand.
Costa Mesa-based startup Audeze LLC is banking on a big year after Apple in December chose its high-end headphones to feature in its busiest retail outlets in the U.S., Canada and Scandinavia.
Its EL-8 titanium model, which costs $800, features what it bills as the first “lightning” headphone connection for the iPod, iPhone and iPad. The digital jack replaces the traditional analog connection, giving sound “much better fidelity or quality,” according to Chief Executive Sankar Thiagasamudram, who cofounded the company about three years ago.
Audeze products, which range from $500 to $4,000, are used by some of the most prolific music engineers in the business, including Grammy winner Manny Marrequin, who has worked with Kanye West, 2Pac and Rihanna to name a few; and Stuart Hawkes at Metropolis Studios in London, who engineered two Amy Winehouse albums.
Audeze’s solid reputation on head-fi.org, one of the most-followed forums for audiophiles, helped the unknown company gain some traction. But the link with Apple added breakthrough credibility in a mature segment with established players such as Bose and Sennheiser, which have been around for more than 50 years, and Beyerdynamic, which created the first headphone in 1924.
“It’s amazing marketing, first of all,” Thiagasamudram said of the Apple partnership.
Audeze’s products are now carried by more than 400 retail outlets, which account for more than 80% of its $10 million-plus in annual sales. It wasn’t that long ago that its website served as the only sales channel.
The company gained plenty of exposure last month in Las Vegas at CES, the world’s largest consumer electronics show, which could foreshadow another strong year for the young company.
“We found at CES people really knew about us because of Apple,” Thiagasamudram said. “2016 is looking really big for us. I think we will double our sales.”
Olloclip
Another OC-based company that has been lifted by an affiliation with Apple is Olloclip. The Huntington Beach-based maker of camera accessories expects a nice sales bump because its multipurpose Active Lenses, which features macro and telephoto lenses, was included in a photography kit Apple offers at retail. The $200 kit, which was on display recently at the Apple Store at South Coast Plaza in Costa Mesa, includes a Manfrotto PIXI Tripod, MeFOTO Sidekick 360 Plus Tripod Mounting Adapter and HISY Bluetooth Camera Remote. Olloclip products also are included in a video kit and sold at every Apple Store, an integral reason the accessory maker has posted double-digit sales gains annually since its May 2011 Kickstarter launch.
“This space is really exploding, and Apple is really pushing hard on photography and video,” founder Patrick O’Neill said.
The Active Lens is geared for iPhone 6 and iPhone 6 Plus models and can be clipped on front- and rear-facing cameras.
Olloclip is coming off a record year in sales, with a 20% gain to an estimated $15 million.
D-Link
Fountain Valley-based D-Link Systems Inc. strengthened its product diversification effort by integrating its app on the latest generation Apple TV, allowing users to control and monitor its smart plugs, water and motion sensors, Wi-Fi cameras and other devices from their living rooms or bedroom TV sets.
“I literally don’t have to get home and get my phone; I can switch over and open up the app,” said D-Link consumer product marketing director Ken Loyd during a private demonstration last month at the Venetian Las Vegas during CES.
The North American unit of Taiwan-based D-Link Corp., which generates about $1 billion in annual sales, has placed big bets on the sizzling Internet of Things segment as it evolves from its legacy router and modem business.
Apple TV runs second to Google Chromecast, which had a 35% market share of the streaming media device segment in the September quarter, according to Newton, Mass.-based Strategy Analytics.
AppleTV, which ranges from $150 to $200, is No. 2 at 20%, but the figure will likely increase following quarterly “all-time record sales of iPhone, Apple Watch and Apple TV,” according to Apple Chief Executive Tim Cook in a recent earnings release for the December quarter.
Apple, which posted December quarter sales of nearly $76 billion, crossed another milestone with 1 billion active devices.
The company demands attention with every segment it enters, but this year is particularly interesting concerning its latest developments of AppleTV that include a nationwide advertising campaign with billboards in Beverly Hills and other parts of Los Angeles.
“There’s a lot of conversations about their whole play in the connected home space,” Loyd said.
