New GC2801 Solution to Support Extended Temperature Requirements of Interconnects for Mobile Operators

October 19th, 2020
SAN JOSE, CA – (Business Wire) – (TSX-V:SEV) Spectra7 Microsystems Inc. (“Spectra7” or the “Company”), a leading provider of high-performance analog semiconductor products for broadband connectivity markets, today announced its entry into the 5G mobile infrastructure market. The Company’s new GC2801 product will support extended temperature range requirements for ruggedized outdoor 5G network deployments.

The 5G infrastructure market is estimated to be valued at USD 784 million in 2019 and is projected to reach USD 48 billion by 2027, at a compounded annual growth rate of 67.1%. Major growth drivers include lower latency in 5G, growing adoption of virtual networking architecture in telecommunications, and growth in mobile data traffic.¹

MARKET OPPORTUNITY EXPANSION

Spectra7 believes interconnect opportunities in the 5G mobile infrastructure market represent a high growth and immediately addressable expansion of the addressable market for Spectra7 GaugeChanger^TM products over the next several years. As recently announced in the Company’s Q2 2020 earnings release on August 31st, 2020, the Company’s first 5G mobile operator is already in qualification and is expected to ramp production in 2021.

Spectra7’s opportunities encompass each end of the 5G mobile network, both at the edge and in the core.

5G NETWORK EDGE

At the mobile network edge, there is an urgent need for single channel high bandwidth connections between Remote Radio Units and Baseband Units using an open standard protocol called enhanced Common Public Radio Interface (eCPRI). Here, a ruggedized version of the standard SFP connector is typically used. Using optics for longer length connections is a must, but for the many shorter lengths up to 12 meters, Spectra7’s solution is much lower power and less expensive than specialized wide temperature range optical components.

5G NETWORK CORE

In the core, mobile operators are embracing a new core switching architecture called Distributed, Disaggregated Chassis which eliminates traditional large monolithic modular switches and moves to a more flexible design using 1U and 2U “pizza box” switches. This architecture is being led by AT&T who released a 400Gbps PAM4 switch reference design² in late 2019 to the Open Compute Project. In this architecture, cables replace the traditional backplane. Spectra7 enabled Active Copper Cables (ACCs) are ideal here due to their much thinner gauge, low power and lower cost compared to optics

GAUGECHANGER^TM GC2801

The GC2801 is the latest addition to the GaugeChanger^TM product line and supports a single channel of 56Gbps PAM4 signaling over an extended temperature range of -40 to 85C that is required for the extreme conditions of outdoor 5G deployments. Standard optical components will not support this temperature range, forcing interconnect suppliers to use much more expensive premium priced optical components. Spectra7’s GC2801 provides a low power, cost effective solution for lengths up to 12 meters. The GC2801 enables ACC interconnects compliant with the eCPRI standard that is widely used by mobile carriers.

“We are thrilled to extend our unique technology to an entirely new market," said Spectra7 CEO Raouf Halim. "We have several customers ready to start building qualification samples with these new GC2801 parts."

GaugeChanger^TM is an innovative and disruptive technology that allows copper to extend much longer lengths without the cost and power penalty of optics. It works equally well at 25 Gbps NRZ and 50 Gbps PAM-4 enabling new connector standards of 100, 200 and 400 Gbps.

ABOUT SPECTRA7 MICROSYSTEMS INC.

Spectra7 Microsystems Inc. is a high-performance analog semiconductor company delivering unprecedented bandwidth, speed and resolution to enable disruptive industrial design for leading electronics manufacturers in virtual reality, augmented reality, mixed reality, data centers and other connectivity markets. Spectra7 is based in San Jose, California with a design center in Cork, Ireland and technical support location in Dongguan, China.

Neither the TSX Venture Exchange nor its regulation services provided (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

CAUTIONARY NOTES

Certain statements contained in this press release constitute "forward-looking statements". All statements other than statements of historical fact contained in this press release, including, without limitation, those regarding the performance and uptake of the Company’s GC2801 product, the Company's future financial position and results of operations, outlook, strategy, proposed acquisitions, plans, objectives, goals and targets, and any statements preceded by, followed by or that include the words "believe", "expect", "aim", "intend", "plan", "continue", "will", "may", "would", "anticipate", "estimate", "forecast", "predict", "project", "seek", "should" or similar expressions or the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the Company's expectations, estimates and projections regarding future events. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied or forecasted in such forward-looking statements. Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to the risk factors discussed in the Company's Annual Information Form and annual MD&A for the year ended December 31, 2019. Management provides forward-looking statements because it believes they provide useful information to investors when considering their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as of the date of this press release and the Company assumes no obligation to update or revise them to reflect subsequent information, events or circumstances or otherwise, except as required by law.

For more information, please contact:

Spectra7 Microsystems Inc.
James Bergeron
Investor Relations
289-512-0541
ir@spectra7.com

Spectra7 Microsystems Inc.
Dave Mier
Chief Financial Officer
925-858-7011
pr@spectra7.com

¹ MarketsandMarkets, 2019 5G Infrastructure Report

² AT&T Submits Design for Service Provider-Class Routers to the Open Compute Project