Catching Up With RESN’s George Holmes

This week I had the opportunity to catch up with Resonant CEO George Holmes. Resonant had just announced the availability of a High-Power Band 41 filter, so it was very timely to understand where the Company is headed and the importance of this new filter design, which is being white-labeled by a ISN Foundry Partner, to their business and their strategy.

What follows below is a summary of our conversation, including side notes- from Tailwinds.

 

Tailwinds Research (TR) – It appears the primary focus of your business model has shifted from working with smaller RF Filter designers to focusing on foundries directly. What’s behind this shift?

George Holmes (GH) – I would not characterize this as a shift but more of an expansion of our market. We will continue to engage vertically integrated manufacturers, but will also extend our focus to include module manufacturers who require a stable supply of high quality filters, and a fabless-foundry model with Resonant providing the design, is very attractive, and a model they are very familiar with.

-It appears that, by adding foundries to their customer base, Resonant has enabled a possible surge in fabless manufacturers entering the RF Filter industry. This is the disruptive piece of their model that enables cellphone suppliers to offer additional products to their offering…products that they couldn’t design or have built before-

TR – The ISN Foundry Partner program has really started to take off, with multiple product announcements. Who are the end customers of these products? Is it the OEMs buying directly from the foundry, or is it a supplier to the OEMs broadening their product offering?

GH – The potential end customers include RF module manufacturers, Passive RF component manufacturers, Reference design companies, so suppliers to the OEM’s. However, the OEM’s themselves could purchase from a foundry, but this is most likely longer term.

-Once again, the end customers are suppliers to the OEMs, offering products they didn’t have before. This is enabling direct competitors to companies like Avago and Qorvo to enter the filter industry. For example, Intel, which is inside the iPhone already, could start selling Intel branded filters, all designed and built through an Resonant ISN Foundry Partner-

TR – What would drive OEMs such as Apple and Samsung to buy from other vendors than the established RF Filter manufacturers like Avago and Qorvo? Can you realistically expect to displace a substantial share of the market?

GH – Established filter manufacturers are potential customers as they cannot produce all the filters required for their modules, and earlier in the year a design attributed to Resonant was found in the teardown of a Tier 1 phone manufacturer. However, a significant portion of the market growth is in China and India where there is substantial opportunity for new players, or manufacturers already established, selling components or modules to the phone OEM’s focused on these markets. It is to these customers that the fabless-foundry model is very attractive.

-It is very important to note that the largest and fastest growing segment of the market (China and India) are incredibly price conscious. By reducing the design cost and time, and often producing in SAW not BAW, Resonant filters are going to be the lowest cost option available to the market-

TR – Regarding the recent announcements of Band 41 Filters, what are the target markets for these filters? How big are those markets?

GH – Band 41 is used by China Mobile, China Telecom and China Unicom for their LTE deployments. Band 41 is also used by Sprint in the US (Spectrum acquired as part of the acquisition of Clearwire). The 2018 projected market size for Band 41 according to Navian is 2.5B units.

-Band 41 is incredibly important globally, as can be seen by the number of units. Since Resonant has designed a low-cost SAW filter, they should be the cheapest option in the market, immediately. As a further side-note, Huawei’s largest US customer is Sprint, so there’s a very good chance that (having already been designed into a Samsung phone) Resonant’s next large customer could be the Chinese giant-

TR – When a foundry announces a new product’s availability, what is the timeline we should expect until we see revenues?

GH – assuming successful qualification at the OEM’s volumes could begin to ramp as early as 3-6 months but that is solely dependent on our customers engagement and success with their OEM customer. Tier 1 and Tier 2 OEM’s demand extensive reliability testing, so would be the longest, while the Tier 3 and 4 OEM’s are aggressive with shorter time to market. They still require reliability testing, but tend to have a narrower scope to their testing.

TR – What recent products are you most excited about and why?

GH – Resonant has several exciting design projects ranging from:

  • Full-Band Band 41 capable of supporting high powers which is normally manufactured using BAW or FBAR process. This is a high value part that Resonant has designed in low cost SAW,
  • Quadplexers required for carrier aggregation which are extremely complex designs, having high ASP’s and, using low cost SAW processes, exquates to high margins for our customers
  • Complex filters for module applications, where now Resonant is incorporating more of the RF Front-End in the design

-In all of these cases, Resonant is designing complex products at a fraction of the time and expense of anyone else. And, the production will be cheaper in SAW, positioning the Company to gain share rapidly-

TR – Are you looking for new spaces for filters like sensors? What other markets might you be able to address?

GH – Resonant continues to investigate new markets for our IP and Tools, analyzing the new market requirements, development commitment and return on investment. The sensor market is a market that Resonant could potentially address using our IP and Tools.

-It could be that RF Filters in cellphones is just the tip of the iceberg for Resonant. Time will tell, but things are looking very exciting for this up and coming company-

Disclaimers & Disclosures: For a full list of disclaimers and disclosures, please visit: www.tailwindsresearch.com/disclaimer/

2 COMMENTS

    • That’s right. RESN’s largest current customer has 6% share in this space already. With a dramatically cheaper product, think that can grow?

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