Wednesday, October 08, 2003


A Kanata startup is trying to make its name by tackling simultaneously two key issues in the field of wireless fidelity.

Aware that a lack of security is perceived to be the Achilles heel of Wi-Fi, Elliptic Semiconductor Inc. believes any solution must be designed into the network, not a Band-Aid fix applied afterwards.

"As a result, we've worked from the beginning to incorporate security into the protocol of our products," says Mike Borza, chief technology officer.

Elliptic has also introduced a product line that requires only a fraction of the power used by most competitors, says founder, president and chief executive officer Gord Harling. "When we compare our (products) to the standard processors used in smart phones and that sort of thing, we save 10 times the power."

Mr. Harling incorporated Elliptic in August 2001 after nearly 20 years in the field, including seven at Montreal-based Goal Semiconductor Inc., which he founded in 1993.

Goal Semiconductor provided design services to help customers mix analogue and digital circuits and created signal conditioning products used to read out sensors.

Although the majority of Goal was sold in 1997, Mr. Harling stayed on with the new owners as president and CEO until 2000.

After a short turn doing consulting, followed by a brief time at Kanata's Atmos Corporation, Mr. Harling ventured into entrepreneurial waters again.

The biggest obstacle facing Mr. Harling was finding cash to begin operations. That was solved through self-financing and ties to angel investors and venture capitalists. Seed funding of $792,000 was in place by the autumn of 2002. The company's executives also seek first-round financing of about $3 million, expected to land by the end of 2003.

Elliptic takes a two-edged approach to improving the security of wireless networks, while reducing power consumption.

The existing security standard, known as wired equivalent privacy (WEP), allowed hackers to determine how often security keys were changed, enabling them to forecast the next key and quickly break in and read data.

"Many people, especially on the enterprise side," Mr. Harling adds, "are not buying portable devices because security isn't turned up. The data isn't scrambled, so anyone can read it."

Even though the problem has been recognized and WEP is being replaced by much stronger security, this only covers security up to the access point, and does not stretch from the access point to the server, Mr. Borza says. To cover that extra distance, users require another protocol.

As a result, Elliptic provides an extra layer of security -- either IP SEC or SSL, both of which maintain high standards that are used by leading financial institutions.

This extra layer of security uses complicated mathematic cryptography that is extremely difficult to crack.

Normally this wouldn't be doable, he continues, because a higher level of security, combined with increased data rates, places an incredible demand on the central processing unit, leading to increased power consumption and limited through-play. This could also limit very bandwidth-intensive activities, such as taking in data or streaming video.

But by addressing the other side of the equation -- conservation of battery power -- Elliptic enhances security to its clients without their having to worry about excessive power consumption. The company can deliver power-efficient services and greatly improved battery life by offloading related functions to highly specialized hardware instead of leaving it on the computer.

In June 2003, the company announced that its Elliptic Low Power (ELP) family of semiconductor intellectual property (IP) products was available for volume licensing.

Elliptic is designing two products in one to address the needs of the 802.11 wireless local area networking market. One provides a high-speed wireless connection capable of providing simultaneous connections while establishing usage priority. The second security-oriented product complements the first and protects the integrity of personal and corporate data from potential hackers.

The company's executives had first aimed its ELP products at wireless device products that use Wi-Fi networking, such as cellphones, personal digital assistants (PDAs), pocket PCs and sub-notebook computers.

"We felt that the wireless client was the big opportunity being missed in the marketplace," Mr. Borza says. "We still feel that way. But the other thing we're finding is that the customers who sell to wireless clients also sell to what's called the broadband access point market. There are a lot of convergence devices, like broadband routers, providing both wireless and wired connections in order for wireless devices to be connected to the Internet. So the pull is coming from a lot of those companies for us to help them implement both sides of that connection."

Having just closed a deal with its first customer, a major chip vendor in Silicon Valley, Elliptic's management has other potential customers evaluating the company's designs with a view to incorporating them in their system-on-a-chip integration projects.

Elliptic has 11 employees in Ottawa, plus representatives in Japan, Korea, Taiwan, Silicon Valley, the Boston area, and other parts of Canada.

"It seems the groundswell interest is in Asia," says Mr. Borza. "The Japanese continue to look for imaginative ways to deploy wireless technology. Cities like Tokyo have huge numbers of commuters who spend a significant fraction of their day on trains. They have all that time to use wireless devices. A lot of smaller technologies are also being rapidly deployed in Japan that use different kinds of wireless networks."

Mr. Borza expresses cautious optimism that an economic recovery in the semiconductor field will occur soon. "There are good signs the integrated circuit plants are getting busy again. Foundries are starting to fill up with new development work and jobs. And in the wireless space, we're finding incredible demand for new products."

The corporate goal is to reach $25 million U.S. in annual revenue by 2006.

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