C-Cube Microsystems was a pioneer in video compression technology as well as the implementation of that technology into cost-effective semiconductors. C-Cube was the first company to deliver on the market opportunity presented by the conversion of image and video data from analog to digital formats enabling markets such as VideoCD, DVD, DirecTV, Digital Cable, Non-linear editing (NLE) and more.

History

C-Cube was founded on 8/8/1988 (the number eight being significant in Chinese culture representing money) by Dr. Edmund Sun from Weitek and Dr. Alexandre Balkanski. The company name originally stood for Creative Circuits Corporation but over time the three C's in C-Cube referred to the markets being served by video compression technology, specifically Computer, Consumer and Communications. Early funding came from VC firms Hambrect & Quist and JAFCO America Ventures as well as Japanese farm equipment manufacturer Kubota Ltd.

Image and video technology was just beginning to make the transition from analog (VHS, Betamax, etc) to new digital-base formats. The key issue was the amount of bandwidth required to transmit or store the digital content. Digital video compression was a key enabling technology that made digital video practical. C-Cube engineers drove the early standards for digital compression - including Eric Hamilton, chair of the JPEG committee and Didier LeGall, chair of the MPEG video committee. As a result of their familiarity of the standardization process and the standards themselves , C-Cube was able to gain advantageous knowledge in the implementation of the algorithms into high-performance silicon.

Early on, the company was recognized for technical leadership but was largely unable to turn leadership into revenues and profits. The company found focus with the hiring of Bill O'Meara as CEO in 1991. He hired a new professional management staff and procured $10M in added investment from Sequoia Capital, Texas Instruments and AMD in late 1992 and enabled the company to drive toward profitability based on the development of leading-edge chips including the CL550 JPEG codec, the CL950 MPEG II (prototype) decoder and the CL450 MPEG I decoder.

These early-to-market devices proved the concept of digital video compression to a number of large OEM customers and led to the development of next-generation industry-enabling products including the CL4000 MPEG II encoder family that enabled the DirecTV program from Hughes and the CL480 MPEG I decoder that drove the VideoCD market in Japan and China in the mid 1990s.

C-Cube went public on the NASDAQ exchange under the symbol CUBE in 1994. O'Meara built a very strong board of directors including Chairman Don Valentine of Sequoia Capital, T. J. Rodgers of Cypress Semiconductor and Gregorio Reyes of Sandisk. O'Meara retired in 1995, turning over the reins to founder Alex Balkanski. Balkanski was accountable for incubating video compression equipment company DiviCom starting in 1993 and C-Cube eventually acquired them in 1996. After this acquisition, the company changed its focus from strictly semiconductors to being both a chip and system supplier. Other acquisitions bolstered PC driver software and reference design expertise including the purchase of the software driver unit of Ring Zero in 1995 as well as MCT in 1996. Umesh Padval was brought in to run C-Cube Semiconductor in 1998. In January 1999, the company acquired system provider TV/COM International of San Diego, CA to bolster its settop box position.

During the late 1990s, C-Cube was unable to repeat its runaway hits seen earlier in the decade. The company sold its DiviCom division to Harmonic Lightwaves in May, 2000 for nearly $1.7B. C-Cube Semiconductor (Nasdaq CUBED) was eventually sold to competitor LSI Logic in March 2001 in a stock transaction worth $878M. Balkanski is now a general partner at Benchmark Capital.

Key Products

Notable Alumni

Mark Allen - Transmeta

Alex Balkanski - Benchmark Capital

Prakash Bhalerao - Amber networks, Ishoni Networks, Alopa Networks, Optim Networks, ECTone

Brian Connors - LSI Logic, Synopsys, Venture Capital

Didier LeGall - LSI Logic, Ambarella

Bill O'Meara - LSI Logic, Early director of Cisco Systems

Rick Rasmussen - LSI Logic, @Road, BuzMe

Steve Zadig - Marvell