Cirrus Logic Inc. has licensed the DivX video codec from DivX Networks (San Diego, California) for both its high end and single-board DVD processor families. The deal would usher in the first sub-$149 DVD players that support DivX-enabled content by late 2003. DivX is an MPEG-4 compatible video compression technology with 75 million users worldwide that offers DVD-quality at 7 to 10 times greater compression than MPEG-2 files. MPEG-4 allows full-length films to easily fit on a CD or be delivered over broadband connections.

Terry Ritchie, Cirrus Logic's vice president of video marketing, said adding DivX technology to its DVD chips would allow Cirrus to "raise the bar of performance to provide more horsepower in DVD ICs and create a new class of DVD product." The first DivX-capable DVD players would allow users to transfer DivX-based content from PCs on CD media and play it on their DVD devices.

By early 2004 Cirrus Logic said its chips would allow users to play DivX content from the web in real-time as well as access the Internet and play streaming audio content. The devices would also enable service providers to offer direct video-on- demand services.

Cirrus hopes adding DivX capability to its DVD processors will give it a leg up in the DVD processor market where it controls only 5 to 6 percent of the DVD processor sales worldwide, compared to 50 percent controlled by market leader MediaTek Inc. of Taiwan.

Adding DivX to its chips won't be the only way that Cirrus will seek to gain ground. Ritchie said Cirrus plans to add Microsoft Corp.'s Windows Media 9 on its DVD processors later this year.