Start-up of the Week / Digital TV Straight to Your Mobile Device

Israeli company Siano has a new product that lets users play digital television on their iPhone or iPad.

More and more, iPads are a video-watching machine. Some suspect the device will do to televisions what the cellular phone did to landlines – making another once-tethered activity individual and mobile.

Outside the house, you can watch television online on iPad (and other devices) using cellular networks. But WiFi - wireless Internet - is not always available and also, watching video hogs a ton of bandwidth. These limitations push the limits of many cell phone service providers' data plans.

The Israeli company Siano is solving this problem. It recently launched a product called Carmel, which picks up live broadcast television signals, allowing users to watch programming on the iPhone or iPad without using a cellular network.
In Israel, the Second Authority for Television and Radio provides free digital television broadcasts in most locations. It currently offers five channels and has plans to expand to 18. Most of the world has made the switch to digital television, making it ready for Carmel.

“The strongest markets in the world for digital television viewing are Japan, Korea and China," said Siano’s CEO, Alon Ironi. In September, digital broadcasting will be launched in the United States, and we'll be there with a product similar to Carmel marketed by Belkin.”

Carmel is part of Siano's effort to branch out from the microchip market, where it got its start.

“Siano was established in 2004 and develops highly integrated receiver chips for mobile TV," said Aloni. "Our traditional business is chips – we supply chips to other manufacturers who turn them into products for the shelf. The advantage of our chip is its low-power design and its ability to work well under difficult reception conditions. This makes it more appropriate for mobile devices such as smartphones and tablets, and less so for home digital TV converters, which are connected to electricity and have a large antenna. Recently, we expanded our range of products, so we are now producing Carmel in its entirety, not just at the chip level.”

Siano also supplies chips for television sets in automobiles, like carmaker Audi's luxury A8 and Q7 models.

Regarding smartphones, Ironi says, “Cellular providers in Europe are not promoting television via cellular phone, so the telephone models that you’re familiar with don’t come with a chip like that. But if you walk into a telephone store in China and buy a 3G model made by Huawei, ZTE or Nokia, it’s pretty likely it will have a chip for receiving digital TV broadcasts.”

Siano’s clients in the cellular telephone industry include Samsung and LG.
Developing a chip is a costly venture – extremely costly, in fact. Siano has received $95 million in investments, mainly from JVP, DFJ-Tamir-Fishman, Walden Israel, Star Ventures and Bessemer Venture Partners. Siano began bringing in significant revenues in 2008 and reached about $37 million in 2011. This year, sales turnover will be even higher.

Siano considered issuing stock but decided against it. Ironi says he isn’t worried that his company has yet to turn a profit, and rejected the idea that it needs another round of fundraising.

“We need to be patient," he said. "This is a rare product in Israel.”

Patience can't solve everything. Last week, Siano had to lay off ten employees, leaving it with 80 – 50 of who work in Netanya. The company also has branches in the United States, Japan, Korea and China.