New Cyclone II Device Family Expands Altera's Leadership in Low-Cost, High-Volume FPGA Market

Builds on Cyclone Device’s Success of 3 Million Devices Shipped and More Than 3,000 Customers

San Jose, Calif., June 28, 2004—When Altera introduced the first Cyclone™ family in 2002, the company targeted high-volume, low-cost end markets where FPGAs were never an option.  Since that time, Cyclone devices have become synonymous with low-cost FPGAs.  Today, the company extends this success with the introduction of the new, lower-cost Cyclone II family.  At three times the logic density and 30 percent lower cost than the first-generation family, Cyclone II devices build on the momentum Altera has established with customers who have discovered Cyclone FPGAs as a compelling alternative to expensive, high-risk ASICs and ASSPs.

With more than 3 million Cyclone units shipped today and over 3,000 customers around the world, the first-generation Cyclone family has had a substantial impact on the high-volume, low-cost digital consumer market, where more than a third of the units have been shipped.  According to Gartner Dataquest, the consumer electronics market alone for FPGAs will reach $390 million in 2004 and is expected to grow to $1.16 billion by 2008, a CAGR of 31.9 percent.  This highly competitive market, driven by shortened design cycles and the need for continuous innovation, reaps maximum benefits from the flexibility of low-cost programmable logic.  Cyclone devices have also gained significant traction in the office automation, networking, and industrial markets, often in conjunction with Altera’s Nios® soft-core processor.

“As low-complexity FPGA device costs continue to drop and become more price-competitive with ASICs, their content will increase in many consumer applications,” said Bryan Lewis, vice president of research and chief semiconductor analyst at Gartner Research.

<>Cyclone FPGAs as Customers’ Competitive Edge
Specifically in the digital consumer market, where Altera currently enjoys a majority market share, Cyclone FPGAs are providing a winning blend of cost, performance and flexibility to digital televisions and displays.  Manufacturers of plasma display products and LCD TVs leverage Cyclone FPGAs for time-to-market benefits, as the competition to get products into retail outlets quickly is particularly fierce.  For these same reasons, Cyclone FPGAs can also be found in new and exciting high-volume applications such as home-movie editing equipment, TV set-top boxes, Internet modems, portable video cameras, DVD recorders and players and replay TV recorders.>

“The digital consumer market is hot and getting hotter, and Cyclone FPGAs are in some of the newest, most advanced systems,” said Erik Cleage, Altera’s senior vice president of marketing.  “Getting customers involved in the product definition of the first-generation Cyclone family gave us valuable insight into their end markets and allowed us to deliver the right products at the right time and in volume.”  Cleage went on to explain, “The Cyclone II family, with even lower costs and more capability, will allow an even broader range of high-volume products to enjoy the benefits of Cyclone FPGAs.  Manufacturers now have the ability to stay ahead of the competition by getting their end products to store shelves quickly and rapidly updating their products with new features and functions.”

<>TSMC as Altera’s Competitive Edge
Cyclone II devices will be manufactured on TSMC’s production-proven 90-nm low-k process technology and are expected to maintain the same track record of flawless execution set by Altera’s 0.13-micron products.  The integrated engineering partnership that the two companies enjoy has given Altera the advantage in meeting commitments to customers.  This is particularly important in the consumer market where a slight delay can significantly affect the end customer’s market share and profitability.  The partnership’s track record is proven by the fact that Altera has out-shipped its competition by approximately five-to-one in products built on the 0.13-micron process node.> <>

About the Cyclone II Device Family
The second generation of Altera’s industry-leading, low-cost Cyclone FPGAs, Cyclone II devices offer 30 percent lower cost and more than three times the density of the first-generation devices, extending Altera’s leadership in the low-cost FPGA market.  In addition, the fastest Cyclone II devices are more than 50 percent faster than the nearest low-cost FPGA competitor.  Leveraging the same customer-driven product definition process that has resulted in the overwhelming success of the original Cyclone family, Cyclone II devices offer the optimal combination of density and performance at the lowest cost.  They also offer an expanded suite of features that will enable designers to leverage programmable logic flexibility in systems that have traditionally required low- to mid-density ASICs.  For more information about Cyclone II devices, please visit www.altera.com/cyclone2.> <>

About Altera
Altera Corporation (NASDAQ: ALTR) is the world’s pioneer in system-on-a-programmable-chip (SOPC) solutions.  Combining programmable logic technology with software tools, intellectual property, and technical services, Altera provides high-value programmable solutions to approximately 14,000 customers worldwide.  More information is available at www.altera.com.>

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*Source:  Gartner Dataquest’s Worldwide ASIC/ASSP, FPGA/PLD and SLI/SOC Application Forecast, 1Q04

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