Intel acquires VxTel, inks pact with i2

Intel has announced plans to acquire VxTel of Fremont. The $550 million-deal

will provide Intel with advanced voice-processing technology and products that

it can then sell to its data-networking customers. VxTel is a fabless

semiconductor company that makes Voice over Packet (VoP) chips that deliver

high-quality voice communications over optical networks.

VoP is a critical technology for enabling the transition from

circuit-switched networks, such as traditional telephone and wireless networks,

to packet-based networks, such as the Internet. The VxTel VoP solution enables

more than 2,000 simultaneous voice connections on a single card.

"Our goal has always been to deliver the first complete solution for

aggregating voice and data in the next-generation carrier networks to create a

truly unified packet-based network infrastructure. Joining with Intel will help

us more rapidly bring this best-in-class solution to more customers

worldwide," said president and CEO of VxTel Shri Dodani.

VxTel will be integrated into Intel's Telecom Components Division of the

Network Communications Group (NCG). Intel has been moving into the networking

and DSP arena for some time, mostly through acquisitions. It bought DSP

Communications for about $1.6 billion in October 1999, $780 million for

Dialogic, $3.5 billion for Level One Communications and $180 million for Shiva.

Intel is also working with Analog Devices on a new DSP standard.

Meanwhile, Intel also announced it has struck an alliance with i2

Technologies to sell server computers equipped with i2 software and Intel chips.

i2 makes software to link companies to their suppliers using the Internet. Intel

and i2 will jointly market the servers and will offer on-site Intel technical

support. i2 has a similar deal with IBM.