Atheros Communications Launches World's First Single-Chip 802.11g Access Point Device

Complete Wireless Access Point Including Network Processor, 2.4 GHz Radio, MAC and Baseband; Substantially Reduces Cost for Residential Gateway Products

SUNNYVALE, Calif., Dec. 14, 2004—Atheros Communications, Inc. (NASDAQ: ATHR), a leading developer of advanced wireless LAN (WLAN) chipsets, today announced the world’s first IEEE 802.11g wireless access point on a chip, the Atheros AR5006AP-G. The AR5006AP-G represents a breakthrough in system integration, combining the wireless network processor, media access controller (MAC), baseband and radio functions into a single silicon chip. Atheros has also integrated many of the discrete components required by previous 802.11g access point designs.

The transition from a two-chip design to a single-chip implementation produces substantial cost benefits. In addition, Atheros has reduced the rest of BOM (bill-of-materials) by almost 20 percent. Atheros achieved this integration without sacrificing the performance of the product—which is a major accomplishment. This highly integrated design will enable manufacturers to offer 802.11g-based consumer residential gateways at mass-market price points, while still delivering the industry’s best throughput and range.

“We expect that a single-chip 802.11g solution for access points will be a key driver in helping OEMs deliver competitively priced consumer wireless gateways," said Ken Furer, semiconductor research analyst, IDC.  "We anticipate that the market will continue to move towards more highly integrated WLAN solutions that reduce cost, yet maintain performance, and we see companies like Atheros helping lead this charge.”

The new AR5006AP-G is the most recent example of Atheros’ RF integration skills using CMOS, and is the world’s first single-chip product designed specifically for wireless access points and routers. The chip’s design also enables it to be embedded into emerging wireless networking devices including media and print servers, external hard-drive storage devices, and home media gateways. Offering high-performance 802.11g connectivity, full support for the IEEE 802.11i security standard, and support for Atheros XR™ (eXtended Range) and Super G® performance enhancements, the AR5006AP-G is ideal for SOHO and home environments.

“Atheros’ innovative single-chip solution dramatically lowers the cost of high-performance wireless LAN technology and will help drive the introduction of low-cost residential wireless gateways,” said Craig Barratt, president and chief executive officer of Atheros Communications. “The AR5006AP-G launch furthers the company’s single-chip product strategy. We are excited that our customers will be able to take this chip and easily integrate the wireless technology into new types of networked devices for the digitally connected home or wireless office.”

The AR5006AP-G features an AES encryption engine built into the hardware, allowing real-time support for full 802.11i security without any performance degradation. Atheros also supports the draft 802.11e Quality of Service (QoS) specification, providing advanced features for delivering wired-quality video and audio content via a wireless connection.

Super G® and Atheros XR™ technologies

Atheros’ popular Super G performance-enhancement features are supported in the new single-chip AR5006AP-G. Super G employs multiple techniques including Dynamic Turbo with Adaptive Radio technology, packet bursting, fast frames, and data compression to dramatically increase the throughput and range of wireless networking products. The technology supports up to 108 megabits-per-second (Mbps) link rates, and enables user throughput of more than 60 Mbps. 

The AR5006AP-G also supports Atheros’ XR (eXtended Range) technology which provides single access point coverage in home networking environments, eliminates “dead spots” in corporate wireless LANs, and provides outdoor coverage of up to two times the distance of competing WLAN solutions.

Atheros AR5006AP-G pricing and availability

Atheros is currently sampling the AR5006AP-G, with volume production expected in Q1 2005. List price for the AR5006AP-G is below $13 in 10,000-unit quantities.

About Atheros Communications, Inc.

Atheros Communications is a leading developer of semiconductor system solutions for wireless communications products. Atheros combines its wireless systems expertise with high-performance radio frequency (RF), mixed signal and digital semiconductor design skills to provide highly integrated chipsets that are manufacturable on low-cost, standard complementary metal-oxide semiconductor (CMOS) processes. Atheros technology is being used by a broad base of leading customers, including personal computer and networking equipment manufacturers. For more information, visit www.atheros.com or send email to info@atheros.com

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Atheros, the Atheros logo, Atheros XR and Super G are trademarks of Atheros Communications, Inc. All other trademarks mentioned in this document are the sole property of their respective owners.

FORWARD-LOOKING STATEMENTS:

Except for the historical information contained herein, the matters set forth in this press release, including statements regarding the features, performance and benefits of Atheros’ AR5006AP-G single-chip solution and its other products; the potential applications of these products; the timing of volume production of the new AR5006AP-G chip; and the expected market trend towards more highly integrated WLAN solutions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, including, but not limited to, difficulties in development and manufacture of new products and upgraded products, including the AR5006AP-G chip; unforeseen problems in the performance of the AR5006AP-G chip or other products upon broad deployment of these products; whether the AR5006AP-G chip will successfully enable low-cost 802.11g products to come to market; whether customers will be able easily to integrate wireless technology into new types of networked devices; whether a single-chip 802.11g solution for access points will be a key driver in helping OEMs deliver competitively priced consumer wireless gateways; and other risks detailed in Atheros’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2004 as filed with the SEC and in other reports filed with the SEC by Atheros from time to time. These forward-looking statements speak only as of the date hereof. Atheros disclaims any obligation to update these forward-looking statements.

For press and analyst inquiries contact: Cheryl Patstone, 408-773-5344, cheryl@atheros.com or Greg Wood, A&R Partners, 650-762-2838, gwood@arpartners.com.