Prakash Prakash AgarwalAgarwal, President, CEO, President, CEOSudhir ChandratreyaSudhir Chandratreya, VP-Technology, VP-Technology

March 21,2000March 21,2000

A Case Study - NeoMagic

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σ Founded - Summer 1993

σ First Production Shipment - 1Q96

σ Leading Supplier of Notebook Multimedia Chips

σ Publicly Held Since 1Q97

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Multimedia

ResolutionColors

Performance

Mobility

Battery LifeSize

Weight

Opportunity: MobilizeOpportunity: MobilizeMultimediaMultimedia

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DRAMMemory

LogicAnalog

IncreasesIncreasesPerformaPerforma

ncence&&

ReliabilityReliability

ReducesReducesSize &Size &PowerPower

ConsumptionConsumption

MagicWareMagicWareTMTM: Pioneering: PioneeringeDRAM TechnologyeDRAM Technology

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Audio Controller

SDRAMMemorySDRAM

MemorySDRAMMemorySDRAM

Memory

GraphicsAccelerator

SDRAMMemory

PowerPowerPowerPowerPowerPowerPowerPowerPowerPowerPower

PowerPowerPowerPower

Power Power

Electro-Magnetic Interference(EMI Noise)

EMI NoiseEMI Noise

Board Space

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Audio Controller

SDRAMMemorySDRAM

MemorySDRAMMemorySDRAM

Memory

GraphicsAccelerator

SDRAMMemory

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GraphicsGraphicsAcceleratorAccelerator

AudioAudio

SDRAMSDRAM

PC

Cam

PC

Cam

1996 1997 1998 1999 20000

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10

15

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Cumulative Units Shipped (millions)

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MarketingManagementEngineeringManufacturing

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σ Major customer product roadmapsσ Major customer feature

requirementsσ Competitive offerings and product

roadmapsσ A well-defined product specification

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σ Research analysts’ forecastsσ Competitive cost structuresσ What is the window of opportunity for the

product?

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σ An accurate evaluation is important - Askthe tough questions!

σ Does the new product fit with yourtechnology roadmap?

σ Does it fit with the capability of one ormore of your strategic partners?

σ Will the product add value at acompetitive price?

σ Match market requirements to yourCompany’s capabilities.

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σ What are the costs for design,development, production, testing cycles?

σ What are the ASPs in the early market?In the later market?

σ Can the product be cost reduced?σ What is the potential return on

investment in each cycle?

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Three Phases of Design DevelopmentThree Phases of Design Developmentσ Phase I - Development

Well-defined specs , Choose correct technology,Right skills for every job, Right tools, Database management,Revision control, Design Reviews, simulations, emulation,Testability, fault grading etc. Develop processes, Create Costreduction plan

σ Phase II - VerificationDo you deliver what you promised?Compatibility Lab Tests (e.g.WHQL)Customer Qualification

σ Phase III - Pre-ProductionCustomer line validation - Catch the problems early, get every line return from customer. Use bench testers, doCustomercharacterization

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σ Identify fab partners with DRAM designcapability & proven process technology

σ Scrutinize their reliability and quality assuranceprocedures

σ Develop tools for monitoring and increasingyields

σ Keep consistent flow and controlsσ Keep close ties with key customersσ Customer will succeed on system level only if

integration leads to a lower defect rate

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