Chipset Maker PortalPlay Goes Public

PortalPlayer (PLAY), who makes the chipsets that are the heart of the Apple iPod line, went public last Friday, raising over $100 million. Although the offering was priced at $17, shares opened $25.60 (and closed today at $28.76).

Inside of every iPod is a PortalPlayer chip that makes all the hardware (harddrive, LCD, etc.) work together, reads audio files, decodes them and plays them. Adding signifcant functionality (playing movies, for example) that is not in your devices chipset is difficult and expensive. This means that audio players rely heavily on their chipset and that new features don't come out until the chipset makers get it done.

Apple, though, always keeps its cards close to its vest and its relationship with PortalPlayer is no exception.

And as you see the relationship between eDIGITAL and PORTAL PLAYER in 2003 press release

e.Digital and PortalPlayer to Co-Develop Digital Audio Products for Consumer Electronics Manufacturers

SAN DIEGO--(BUSINESS WIRE)--Jan. 9, 2003

e.Digital Corp. (OTCBB:EDIG) today announced a development and co-marketing partnership with PortalPlayer Inc.

As a PortalPlayer Design Partner, e.Digital plans to develop new digital audio products combining PortalPlayer's single-chip integrated circuit for music encoding and playback with e.Digital's reference designs. As part of the agreement, PortalPlayer will refer pre-qualified OEM customers to e.Digital for product development using PortalPlayer's chip set.

Researchers from IDC forecast that the digital audio market will exceed 200 million units worldwide by 2006, presenting a great opportunity for OEMs who can deliver compelling and powerful entertainment devices," said Michael Maia, vice president of marketing for PortalPlayer. "We qualified e.Digital as one of our charter Design Partners because of their ability to speed manufacturers time-to-market and expertise in system integration, firmware development and project management."

Fred Falk, president and CEO of e.Digital, said, "We are pleased to continue our tradition of incorporating new technologies with our MicroOS(TM) to create useful applications and attractive products for OEM customers. Being a charter company in PortalPlayer's Design Partners Program puts us in a position to help OEM customers navigate emerging industries, determine the quickest path to product completion, and launch a number of different products with the latest features. It opens the door for revenue-producing opportunities from a broader customer base."

The PortalPlayer Design Partners Program provides a fast track to new system designs by giving OEMs access to the engineering resources and complementary intellectual property of its qualified partners, and PortalPlayer's system-on-chip (SoC) platforms, firmware, system architecture, and PC-based digital media management applications. Using PortalPlayer's platforms as a starting point, Design Partners work with OEMs to quickly and cost-effectively build differentiation into next generation products.