Russia’s state-owned VC firm heads a $79m investment round in six-year-old Californian wi-fi chip maker, with the promise of leading a revolution in the home entertainment market. Guy Daniels reports.
With high-definition video practically the norm for most connected households now, creating reliable wireless networks to route video and data through the home becomes increasingly difficult. Routing audio is bad enough, with even modest sized buildings requiring wireless extenders to reach every room. VD video takes the wireless challenge to a whole new level.
US-based Quantenna Communications thinks it has the answer. The six-year-old company already has the backing of leading Valley VC Sequoia Capital. This week it has raised $79 million in a new round of financing, to help it develop what it describes as “ultra reliable video over Wi-Fi”. All existing backers participated, plus it raised an extra $40 million from Rusnano, the VC company owned 100 per cent by the Government of the Russian Federation. Interestingly, Rusnano describes its mission (the clue is in the name…) as being “to develop the Russian nanotechnology industry through co-investment in nanotechnology projects with substantial economic potential or social benefit”. Quantenna will now open a Russian subsidiary as part of the deal.
Quantenna Communications is a fabless semiconductor company developing standards-based 802.11n and 802.11ac MIMO chipsets. It goes about the task of creating “ultra reliable video” support by adopting a 4x4 MIMO chipset design, and says that it is experiencing “insatiable demand” for its products.
Rusnano’s Managing Director, George Kolpachev, joins the board and explains why he invested in the firm:
“Quantenna has done more than any other company in the world to unleash the technical potential of Wi-Fi by pioneering 4x4 solutions. This investment, along with our collaboration on a subsidiary entity in Russia, will help expand the role that Russia’s science and engineering schools are playing in the development of world-class solutions for the rapidly growing wireless equipment segment.”
Another of Quantenna’s high-profile investors is Telefonica Digital.
It’s CTO, Enrique Blanco, said of the telco’s interest:
“Successful deployment of wireless Internet-enabled TVs, video game consoles and set-top boxes demands that multiple high-definition video streams can be distributed to any point in the home with ultra-high reliability and performance at full, 1080p resolution. This requires 802.11n at 5GHz technology with the right feature set for delivering the optimum subscriber experience.”
By pushing the development of MIMO technologies and focusing on other wireless technologies such as beam-forming, telcos can concentrate on delivering even more video-based services into the home – confident that their subscribers have a reliable means of distributing the content to all of their connected devices throughout the home. As well as eliminating the problem of the home networking bottleneck (after all, who wants to run wires throughout the house? It’s bad enough having to hide the surround-sound rear speaker cables under the carpet…), it also reduces the need for telcos to offer maintenance and support services.
But it’s not just the telco market that appeals to Quantenna. The company’s CEO, Sam Heidari, says that:
“Our video-over-Wi-Fi chipsets are on their way to penetrating new markets this year beyond the service provider segment. The round also enables us to expand our presence in Russia with the addition of a team of highly qualified specialists.”
According to market research firm Gartner, Wi-Fi-enabled device shipments will grow from less than 1 billion units in 2010 to more than 3 billion in 2015, making Wi-Fi one of the most influential wireless technologies in the years to come. According to Cisco’s 2011 Visual Networking Index Forecast, video alone is expected to reach about 90% of global traffic. Video services have become a primary revenue source for carriers worldwide, and demand continues to grow at an unprecedented pace for video content delivery from emerging over-the-top (OTT) service providers. Quantenna’s 4x4 MIMO chipsets represent the only commercially available solution for ultra-high reliability, carrier-grade video distribution in both managed and OTT architectures.
Quantenna needs the extra cash to keep it competitive against the likes of Qualcomm and Broadcom who you can bet are not going to cede this market segment to a young start-up. Especially when Cisco keeps rolling out the stats about 90 per cent of global data traffic being video-based in the near future and Gartner adds that there will be 3 billion wi-fi enabled devices by 2015.
Most home wi-fi routers are incapable of supporting a single HD video stream, yet Quantenna says its 4x4 MIMO solution can carry four simultaneous HD streams, at four times the distance of basic wi-fi. The company’s literature suggests it can reach transmission rates of 180Mbit/s. In addition, it believes that its forthcoming 802.11ac products can push the rate to 360Mbit/s.
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