Broadcom, Next Level Plan Joint Venture

Broadcom Corp. today will announce a multiyear joint venture with a Rohnert Park company to transform copper telephone wires into a powerful weapon that telephone companies can wield against cable television operators.

The Irvine chip maker and Next Level Communications Inc., which have worked together for the last several years, plan to co-develop chips for set-top boxes that work with very high speed digital subscriber line, or VDSL, technology.

The chips will go into Next Level’s new line of residential gateways, which are home computers dedicated to handle a variety of electronic tasks.

The set-top boxes, officials say, will let telephone companies offer customers voice, data and video services--and at prices consumers now pay for the same services from a cable network.

“This is really the only means [for telephone companies] to respond to the services being rolled out by AT&T; and Time-Warner” and other cable companies, said Henry T. Nicholas III, Broadcom’s chief executive.

Broadcom and Next Level, which designs high-speed communications equipment, said they will have teams of engineers in San Jose and Irvine working on the project.

Financial details of the venture were not disclosed.

Though promising, the VDSL market remains relatively small partly because telephone companies have been slow to roll out the service.

Yet analysts note that as cable companies gobble up customers with offers of fast Internet access and telephone service, the big telephone firms are starting to push hard to provide such DSL connections.

Indeed, Broadcom today will announce that it has shipped 250,000 VDSL chips to local exchange carriers in the last year.