Altera Acquires Avalon Microelectronics, Extending Its Communication System IP for FPGA and ASIC Product Portfolio

SAN JOSE, Calif., Dec. 14, 2010 -- Altera Corporation (Nasdaq: ALTR) announced today it has acquired Avalon Microelectronics Inc., an industry leader in flexible Optical Transport Network (OTN) IP, for use in its FPGA and ASIC products. With the acquisition of Avalon, Altera expands its portfolio of customizable IP solutions for OTN applications, supporting data rates at 1.2G, 2.5G and 10G, as well as 40G and 100G.

"As FPGAs increasingly replace ASICs and ASSPs in the heart of many systems, Altera is delivering more system-level technologies and solutions to our customers," said Don Faria, senior vice president, Communication and Broadcast Business Division, at Altera. "Avalon has been a key partner for many years and is the sole IP supplier for the 100G OTN solutions implemented in our FPGAs. With its strong system expertise in transmission applications and detailed FPGA knowledge, Avalon has established itself as a key provider to numerous top-tier communications infrastructure OEMs. We are excited to have Avalon join the Altera family."

As communications network bandwidth requirements grow exponentially to support video data (which comprises over 90% of consumer traffic), service providers need equipment providing flexible provisioning and seamless upgradeability for next-generation standards, such as 100G and 400G. The optical wavelength-division multiplexing (WDM) equipment market is expected to grow from $6.7B to $10.4B, or 56 percent from 2010 to 2014, with 40G and 100G deployments leading the way(1). Because new optical protocol standards are being developed simultaneously with new equipment design, equipment manufacturers require flexible hardware solutions using FPGAs with future cost-reduction paths such as Altera's HardCopy™ ASICs.

"Our customers require flexible OTN solutions that can operate at very high data rates," said Wally Haas, Avalon's founder and chief technology officer. "Aligning two companies that are leaders in their respective space just makes a lot of sense, and we could not be more pleased joining Altera. Altera's 28-nm and 40-nm product portfolio demonstrates their leadership in high-performance flexible silicon platforms for the communications market. The integration of our two companies' technologies and expertise will dramatically accelerate our communications customers' time to market with next-generation optical networks, as our combined customizable IP enables our customers' differentiation in their market."

Terms have not been disclosed on the acquisition, which is not a material financial matter for Altera.

About Altera

Altera® programmable solutions enable system and semiconductor companies to rapidly and cost-effectively innovate, differentiate and win in their markets. Find out more about Altera's FPGA, CPLD and ASIC devices at www.altera.com. Follow Altera via Facebook, RSS and Twitter.

About Avalon Microelectronics

Avalon Microelectronics is a recognized leader in the development and delivery of IP for OTN, SONET/SDH and Ethernet applications to telecom equipment manufacturers. Avalon provides silicon-proven, customized IP to accelerate the time to market of next-generation optical networks. For more information about Avalon Microelectronics' products and applications, please visit us at www.avalonmicro.ca.

1. Infonetics, 2010