Broadcom Shows Off Its Faster Network Chip

Expanding its presence in the booming business market for high-speed Internet access, Irvine-based Broadcom Corp. on Tuesday unveiled a new chip that will help create faster office computer networks and move data at least 10 times quicker over existing copper-wire lines.

The company demonstrated the chip at a high-tech conference in Las Vegas, where it showed that the new product could transfer data as quickly as one gigabit a second--one billion bits of data per second--over copper-based wiring traditionally used in business offices.

Most company networks that use this kind of wiring now operate at 10 megabits or 100 megabits a second.

Broadcom’s chip allows companies to enjoy faster connections to the Internet--as well as handle videoconferencing and telephone calls--without having to rewire their buildings with expensive fiber-optic lines.

The chip will be used predominantly in devices, known as Ethernet switches and networking cards, aimed at the general business market, analysts said.

“We’ve all been waiting for this,” said Mike Wolf, an industry analyst with the high-tech market research firm Cahners In-Stat in Scottsdale, Ariz. “As more commerce and traffic is moved over to the network, there is more demand for faster speeds.”

The announcement further expands Broadcom’s computer networking product line, which accounts for about 40% of the chip maker’s current business. Broadcom has exclusive relationships with some big-name makers of computer networking equipment, cable modems and television set-top boxes. Customers that are already shipping Broadcom’s other networking products include 3Com and Cisco Systems.

“We’d like to see this implemented all the way down to the desktop,” said Broadcom Chief Executive Henry Nicholas III, who expects products using the company’s new chip to be in production by the third quarter. “This is plug-and-play technology, and one of the most significant releases in the history of the company.”

But analysts say that Broadcom’s chip may soon face competition, as rival Level One Communications is expected to release similar chips within a year.

Broadcom’s stock shot up 10.3%, or $8.69 a share, on Tuesday to close at $92.69 amid heavy trading on the Nasdaq market.