Company profile: DIGITAL-LOGIC

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The PC/104 market is composed of a variety of companies that often manufacture more than just PC/104 modules. The Swiss company DIGITAL-LOGIC is no exception. A supplier of both PC/104 and other small form factors, the company is indicative of the market’s many innovators. DIGITAL-LOGIC was among the first to deploy Pentium processors on PC/104 by designing a unique heat sink, and they continue to offer insight on how small-form-factor vendors are meeting the challenges of market demands concerning more performance, reducing costs, and meeting European Restriction of the use of Hazardous Substances (RoHS) requirements.

OpenSystems Publishing European bureau chief Stefan Baginski recently caught up with DIGITAL-LOGIC’s CEO Felix Kunz.

DIGITAL-LOGIC is a mid-size company specializing in supplying its customers with PC/104 and other small-form-factor embedded computers. Their modules are small, provide relatively high performance for their size, and usually offer an excellent compromise between power consumption and performance. Furthermore, the company offers a range of small and fanless computers called MICROSPACE computer systems.

DIGITAL-LOGIC is located in the northwestern part of Switzerland and supplies customers in the areas of industry, government (including military and space), and applied sciences. Below is a recap of my recent conversation with the company’s CEO Felix Kunz.

S.B. What is your market position, and where do you see DIGITAL-LOGIC now?

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Felix Kunz

F.K. We are in the embedded market and have the smallest size product of its class on the market. I do not know of any other company that offers the same performance in the same- or smaller-size product format. This achievement is not easy. We have to keep to the standard interfaces, of which there are quite a few, and reducing module sizes is not easy and often even impossible. In addition, we have to follow thermal restrictions of all sorts.

We are not only a design and layout company, but we have to make sure that every DIGITAL-LOGIC designed board has solved the thermal dissipation problem. CPU performance generates heat and its dissipation or optimized distribution is one of our main objectives. One of the ways we do this is to use a copper ring acting as a power dissipation radiator. One example of this implementation is our smartModule board, measuring 66 mm x 85 mm x 14 mm (2.6" x 3.3" x 0.6"), that has a Pentium processor working at 2 GHz (see Figure 1). I have not yet seen a smaller module from our competition with an equivalent or better processor.

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Figure 1

The MICROSPACE PC systems are fully equipped with hard disk, DVD, and passive cooling system. You will find no fan, and everything is rock solid in this clever patented cooling concept. Other features of our products include scalability, designs that are built for rugged environments, and a long-life-cycle availability guarantee.

S.B. And now you are facing the RoHS challenge. What does that entail?

F.K. In Europe, use of leaded products will be restricted beginning in summer 2006. But we already have lead-free computer boards. As soon as we can get all associated components such as hard drives in RoHS-compliant versions, our products will be lead-free from the beginning of 2006. But beyond components, the lead-free production process is also more expensive. Our process must be free of “tin” whiskers.

Some customers, such as the military, are likely to remain using leaded products because of their experience with quality. They are prepared to pay for the 10-year guarantee that coincides with their typical life cycle.

S.B. How is the market changing for you?

F.K. We had our revenues growing even at times of a slower growth in the market. During 2002-2004, we experienced about 15 percent growth per year, and we expect our growth to rise to 20 percent or more in the next few years. We are growing organically, from the financial point of view, and we are a conservative company. We keep ourselves more and more debt free and that’s what our shareholders like. Thus, we are not planning an IPO, as we plan to stay stable. In our business, the customer loses confidence if he observes too much movement around the supplier. Over the years, we have kept the same sales people to service our customers and changed only the products to meet their needs.

In 1998 and 2000, we had a couple of rounds of refinancing and invested in new technologies. Since then, we’ve been operating in a high-cost marketplace, with high salaries, and we must therefore push the automation rate as high as possible to make ourselves competitive with the Far East production competitors. We do not expect to outsource our production to offshore countries. Our biggest challenge is here, in continuing innovation, increasing yields, and investing in people.

Note that 90 percent of our shipments are exported, outside of Switzerland, and about 50 percent end up in Europe. We always concentrate on top performance. With our own production, we are capable of assembling approximately 100,000 units per year, so we have to concentrate on niche markets. For large quantity projects, we cooperate with subcontractors for assembly.

On the technology side, we started very early with RoHS, and the other challenge is to stay close to Intel. The technology changes rapidly, and DIGITAL-LOGIC is focused on Intel because of product stability and the 10-year long life program. As a positive example, we have 386 chips in stock, which is a device that has been running now for more than 20 years. We take care to supply our customers with products for up to 10 years. Only product stability, product quality, and continued new developments guarantee our leading position in the embedded market.

S.B. What technology or services are to be expected in the future?

F.K. DIGITAL-LOGIC will integrate Intel’s high-performance CPUs as dual core Pentiums with low power consumption. For medium performance and lower priced applications, we will come up with products featuring the AMD Geode800. At the computer show, SPS 2005, in Nuremberg, we are going to introduce our new generation of products featuring the GX 800LX processor.

S.B. Where are you staying on the value chain?

F.K. We are staying with our core competence. Our SM855 and SM915 are amazing modules. As I said, we consider them to be the world’s smallest Pentium M computer modules, which are based on the Intel 915GM chipset (533 MHz front-side bus) and use the Pentium M processor at speeds from 0.6 to 2.0 GHz. Performance is our goal, and with 2 MB of L2 cache, the Pentium M clocked at 1.8 GHz reaches a performance level compatible to that of a 3.4 GHz Pentium 4 processor. Our module consumes only 6 W to 20 W. The SM915 uses the Extreme Graphics video controller and supports DirectX 9 with up to 256 MB.

We also use a sophisticated cooling concept, in which a cover is made out of a high-strength, milled aluminum block with a fixed bearing system around the circuit board, and it has a special copper core mounted on the CPU, which is pressed tightly against the enclosure wall or against the heat sink. The unit works in the standard temperature range of -0 °C to +60 °C, screened under the E48 modules. With lower CPU clock rates such as 600 MHz, the module has also been approved for an extended temperature range of -40 °C and +85 °C. As you see, we try to always move upwards in the value chain, thus our products are easier to use and they provide cost-effective solutions to the end user.

S.B. Finally, how much software is involved in your product development?

F.K. We provide all board support packages and drivers, and support all major operating systems such as VxWorks, Linux, Microsoft’s offerings, QNX, and several others.

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For more information, contact Felix at:

DIGITAL-LOGIC AG
Nordstrasse 11/F
CH-4542 Luterbach
Tel: +41-0-32-681-5800
Fax: +41-0-32-681-5801
E-mail: felix.kunz@digitallogic.com
Website: www.digitallogic.com