Conexant Makes Connection with PCTEL'S Soft Modem Business Unit

5/12/2003 - Conexant Systems, Inc. (Nasdaq: CNXT), a worldwide leader in semiconductor system solutions for communications applications, and PCTEL, Inc. (Nasdaq: PCTI), a leading provider of Internet access products, 802.11 mobility software and software-defined radio products, announced that Conexant has acquired PCTEL’s soft modem operation.

“Conexant has a long history of innovation and leadership in modem technology, and our connectivity solutions can be found in a wide variety of products including desktop and notebook computers, handheld devices, video game consoles, and set-top boxes,” said Matt Rhodes, president of Conexant’s Broadband Communications segment. “The acquisition of PCTEL’s soft modem unit strengthens our well-established position, and we look forward to providing PCTEL’s customers with continuity of supply and the same outstanding support our customers enjoy as we continue to deliver solutions that connect millions of people to the Internet. As we focus on making this event transparent to customers, Conexant will continue to support the highly regarded Silicon Labs silicon DAA for the PCTEL host signal processing (HSP) modem product family.”

“We are proud of the leadership role that PCTEL played in developing the soft modem industry and believe that Conexant is the ideal supplier to provide our customers with the technology and support required for long-term success,” said Marty Singer, PCTEL’s chairman and chief executive officer. “During the past few years, as we enjoyed success in the modem market, we also established a strong intellectual property portfolio, and we have determined that now is the right time to change our strategic direction. This agreement strengthens our modem patent portfolio and will allow us to focus our attention on new businesses in wireless networking. It also enhances our ongoing licensing business while reducing our exposure to the patent claims of others.”

Under the terms of the agreement, Conexant will take over PCTEL’s facilities in Milpitas, Calif., and Taipei, Taiwan, and retain key customer support resources in Austin, Texas, and Tokyo, Japan. Approximately 30 PCTEL employees will transfer to Conexant. The company also received a fully paid-up, worldwide license under PCTEL’s modem patent portfolio. The license covers patents essential to the implementation of the V.90 standard as well as other soft modem patents. Conexant expects the acquisition to be accretive as early as the September-ending quarter.

PCTEL will receive an undisclosed amount of cash for its modem operations, and a commitment that Conexant will utilize PCTEL’s SegueTM Roaming Client software with its 802.11 Wi-Fi products. Conexant will pay a royalty to PCTEL on its modem sales over the next four years. PCTEL retained all rights to its modem portfolio as well as its existing licensing business, and acquired ownership of more than 20 Conexant patents, including several pertaining to the relatively new V.92 standard and Ethernet technology.

The total value of the transaction could be as much as $19 million, depending on royalty payments. Other terms of the agreement were not made public. The agreement is subject to customary closing conditions and is expected to be completed in the next few days.

About Soft Modems and V.90/V.92 Standards
A soft modem has the same functionality as a traditional hardware modem, but all of the digital signal processing is done in the host computer’s main processor. V.90 is a standard established in 1998 that makes it possible to accelerate data downstream from the Internet to a computer at speeds up to 56 Kbps. V.90 is currently the most prevalent modem standard, and is used by individuals worldwide to connect to the Internet. Modems based on V.92, the most recent modem standard, provide broadband-like advantages that include quick access, an uninterrupted connection and faster performance.

About Conexant
Conexant Systems, Inc., a worldwide leader in semiconductor system solutions for communications applications, leverages its expertise in mixed-signal processing to deliver integrated systems and semiconductor products through two separate businesses. The Broadband Communications business develops and delivers integrated semiconductor solutions that enable digital entertainment and information networks for the home and small office. Its product portfolio includes the building blocks required for bridging cable, satellite, and terrestrial data and digital video networks. Mindspeed TechnologiesTM, the company’s Internet infrastructure business, designs, develops and sells semiconductor networking solutions for communications applications in enterprise, access, metropolitan and wide area networks. Conexant is headquartered in Newport Beach, Calif. To learn more, visit us at or

PCTEL, founded in March 1994, is a leading provider of innovative and cost-effective Internet access solutions, 802.11 mobility software and software-defined radio products. PCTEL's products include analog soft modems, DSP-based modems, WLAN software products (Segue TM Product Line) that simplify installation, roaming, Internet access and billing. Through its subsidiary, DTI, the company designs, develops and distributes OEM receivers and receiver-based products that measure and monitor cellular networks. The company maintains a portfolio of more than 80 analog and broadband communications and wireless patents, issued or pending, including key and essential patents for modem technology. The company's products are sold to PC manufacturers, PC board and card manufacturers, wireless carriers, wireless ISPs, software distributors, wireless test and measurement companies, and system integrators. PCTEL headquarters are located at 8725 West Higgins Road, Suite 400, Chicago, IL 60631. Telephone: 773-243-3000. For more information, please visit our web site at:

Conexant and Mindspeed are trademarks of Conexant Systems, Inc. PCTEL, the PCTEL logo and Segue are trademarks of PCTEL, Inc.

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