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Systemonic of Germany has acquired the products and intellectual property of the RF Networking group of Raytheon Commercial Ventures Inc. as part of a multi-faceted agreement that also gives Lexington, Mass.-based Raytheon Co. an undisclosed stake in the Dresden, Germany-based wireless silicon provider.

The deal, announced on Wednesday, is significant because it will give Systemonic the ability to offer a whole silicon system solution that focus on powering wireless data, video and voice networks, across standards and across the world.

Systemonic has made a name for itself by providing a robust solution that is capable of supporting multiple standards. While IEEE 802.11b has emerged as the global standard, several regional standards are vying for supremacy for next generation protocols and performance levels. North America has adopted the IEEE 802.11a specifications with 802.11g under discussion. In Europe, HiperLAN/2 or 802.11h may be the future protocol for high-speed communications. Completing the regional morass, Japan is expected to use its local flavor of high-speed wireless networks in addition to global standards.

However, Systemonic's solutions failed to satisfy the needs of customers because its engineers only provided two of the three components of a chipset solution: the MAC (or media access controller) and the baseband (or modulation scheme) -- the third being the RF or radio frequency technology. That meant Systemonic's customers had to rely on another RF vendor to integrate its CMOS baseband integrated circuits into a usable reference design.

"The announcement is pretty significant. It bolsters Systemonic's profile and makes them more viable from a technology and product perspective. However, they will still face considerable competition from other companies developing 802.11a solutions," said Navin Sabharwal, vice president of Residential & Networking Technologies at Allied Business Intelligence.

Among its fiercest competitors will be Atheros Communications, a Sunnyvale, Calif.-based start-up that is first out the gate with an 802.11a reference design. Customers as large as Intel and Sony have already signed onto Atheros's two-chip CMOS solution that incorporates RF, baseband and MAC components.

"This gives them more of a solution but it doesn't give them a whole solution," said Mark Bercow of Atheros. "One of our advantages ... is our architecture was done all at the system level. That level of integration is what allowed us to create a complete 802.11a solution in two standard-process CMOS chips. My impression is it looks like they are compiling chips to create a solution but I don't think it will be as integrated."

Systemonic, meanwhile, said it will integrate Raytheon's 2-chip set, marketed as Tondelayo, with its own flagship family of flexible CMOS Baseband integrated circuits, code-named HiperSonic. Systemonic will also support the design-in and resale of the Raytheon power amplifier as part of its total solution. Sampling of a whole solution is expected to begin by December with production and volume shipments slated to start in Q1 or Q2 of next year.

Sabharwal points out that the deal, in part, was driven by Systemonic's customer demands. And those same demands could lead to similar acquisitions (or even outright mergers) of smaller chipset component developers such as Almet (which focuses mainly on the MAC layer), RF Micro Devices (which focuses on the RF as its name implies) and Embedded Wireless Devices (which just does the MAC and Baseband much like Systemonic).