Profile: Vimicro International Corporation (VIMC.O)

Vimicro International Corporation (Vimicro), incorporated in February 2004, is a multimedia semiconductor and solution provider. The Company designs, develops and markets mixed-signal semiconductor products and system-level solutions that enable multimedia capabilities in a variety of products for the consumer electronics, communications and surveillance markets. It primarily designs, develops and markets mixed-signal multimedia processors for personal computer (PC) and embedded notebook cameras, as well as for mobile phones. The Company provides customers with comprehensive, system-level solutions that include highly integrated semiconductors, customizable firmware and software, software development tools, reference designs and applications support. It conducts most of its operations in China.

Personal Computer and Embedded Notebook Camera Multimedia Processors

The Company designs different models of PC and embedded notebook camera multimedia processors based on the same core technology platform with modifications in successive models with improved performance and functionality. Its PC and embedded notebook camera multimedia processors are compatible with sensors that are based on complementary metal oxide silicon (CMOS) or charge-coupled device (CCD) technology, the two primary types of technology for sensors. All of its PC and embedded notebook camera multimedia processors are single-chip processors manufactured under its own brand name using its intellectual property. It also develops and sells a range of basic, complementary semiconductor products in order to provide more comprehensive solutions for its customers.

In January 2009, the Company introduced VC0345, a controller chip for universal serial bus (USB) 2.0 notebook PC embedded cameras with high resolution (up to two mega pixel); supports Universal Video Class (UVC) standard; small footprint quad flat no-leads (QFN) package and low-power design, and is suitable for embedded camera applications. VC0361 is a controller chip for USB 2.0 notebook PC embedded cameras capable of producing images of three mega pixel at 15 frames per second in the Moving Picture Experts Group (MPEG) format; supports UVC standard; small footprint QFN package, and low-power design suitable for embedded camera applications. VC0343 is a controller chip for USB 2.0 notebook PC embedded cameras with high resolution (up to two mega pixel); supports UVC standard and Universal Audio Class (UAC) standard; small footprint QFN package, and low-power design suitable embedded camera applications. The products offered by the Company also include VC0342, VC0341, VC0301HUVC, VC0334, VC0333, VC0336, VC0301V, VC0332, VC0331, ZS0211, VC0326, VC0325 and VC0323. During the year ended December 31, 2008, the Company shipped 29.9 million units of PC and embedded notebook camera multimedia processors. Vimicro’s multimedia processors are incorporated into the products of PC and embedded notebook camera vendors, such as Logitech, as well as notebook computer vendors.

Mobile Phone Multimedia

Vimicro’s mobile phone multimedia processors are specifically designed to address the need for low-power solutions for embedded cameras, and video and audio functions in mobile phones. All of its mobile phone multimedia processors are sold under its own brand name. VC0824 is an ARM926-based media player processor; supports hardwired (HW) video codec, Joint Photographic Experts Group (JPEG) encoder and decoder, MPEG Layer-3 audio (MP3) playback, MPEG4 and h.264 playback, secure digital (SD)/multimedia card (MMC) card support, and not-and-logic (NAND) flash support. VC0578 is a mobile camera processor with 0.13-micrometer technology; integrates hardware JPEG codec, five mega pixel camera processor, hardware MPEG4 codec, liquid crystal display (LCD) controller, display scaler and power management unit, and provides a high-end camera solution for the 2.5G and third generation (3G) handset market.

VC0988 is a mixed-signal, single-chip mobile audio processor with 0.18-micrometer technology; integrates HW MP3 decoder, 64-channel musical instrument digital interface (MIDI) synthesizer, 10-band equalizer, stereo audio digital-to-analog conversion (DAC), stereo headphone amplifier, eight-bit microcontroller unit (MCU), file allocation table (FAT) 12/16/32 file system, NAND flash controller, and a SD/MMC card controller. It provides a solution for 2.5G and 3G music phones. The Company’s products also include Vinno III, an ARM926EJ based applications processor; VC0978, a mixed-signal, single-chip mobile audio processor with 0.18-micrometer technology; VC0548 and VC0528, which are single-chip mobile camera processors with 0.13-micrometer technology; Vinno II, a single-chip mobile multimedia processor with 0.13-micrometer technology, and Vinno I, a mixed-signal, single-chip mobile multimedia processor with 0.18-micrometer technology.

During 2008, the Company shipped approximately 19.7 million units of mobile phone multimedia processors. Its mobile phone multimedia processors are used by international and China-based mobile phone brand owners, such as Samsung, LG, Huawei, ZTE, TCL, and Lenovo, as well as mobile phone design houses based in China, including China Techfaith Wireless Communication Technology Limited, CEC Wireless R&D Ltd. and Yuhua Teltech (Shanghai) Co., Ltd

Security and Surveillance

The Company’s security and surveillance products include VC0706, VC0703 and VC0702. VC0706 is a camera processor with enhanced image processing functions. As a system-on-chip (SoC), it has CMOS sensor interface and digital video input interface, can capture the video stream from CMOS sensor or external television decoder, implement video enhancement, and on-screen display (OSD) interface overlay and motion detection. External host processors can control the VC0706 processor through the flexible serial peripheral interface (SPI)/universal asynchronous receiver/transmitter (UART) interface.

VC0703 is a video camera processor designed for applications that require high-frame rate, low-image noise, small package, low-voltage and low-power consumption. It supports various video outputs, such as interlaced/progressive phase alternating line (PAL)/National Television Systems Committee (NTSC) composite video output; red-green-blue (RGB)/green (Y), blue (Cb), red (Cr) (YCbCr) component video output and separate video (S-Video) output, and supports OSD. VC0702 is a video camera processor designed for applications that require small package, low-voltage and low-power consumption. It supports various video outputs, such as interlaced/progressive PAL/NTSC composite video output, RGB/YCbCr component video output and S-Video output. During 2008, the Company shipped 3.5 million units of security processors.

Other Products

To meet the needs of China-based PC and embedded notebook camera manufacturers for more comprehensive system solutions, the Company frequently orders image sensors based on its specifications from third-party sensor manufacturers and bundles them together with its mixed-signal PC and embedded notebook camera multimedia processors. The Company has introduced digital surveillance cameras, surveillance system and management software, digital video decoders, recorders and servers. It is also developing and selling mixed-signal power management chips as part of its SoC and system solutions. During 2008, the Company shipped 162.6 million units of its power management chips.

The Company competes with ALi Corporation, EMPIA Technology, Sonix Technology, Sunplus Technology, Philips, NEC Electronics, Oki Electric, Rohm, Winbond Electronics Corp., Yamaha, ATI Technologies, CoreLogic, MtekVision, Nvidia, Sanyo, Seiko Epson, Analog Devices, Broadcom, Freescale, Infineon, Intel, Mediatek Corporation, QUALCOMM, STMicroelectronics, Texas Instruments, Sony, Samsung and NXP.