Apple (AAPL +1.18%) held its worldwide developers conference on Monday, unveiling a slew of new software updates. One of those updates, a home automation platform dubbed HomeKit, has the potential to spur a new round of smart devices for the home.
Although it's no guarantee that HomeKit, specifically, will be a success, there are a couple chipmakers that may see a new round of growth if the home automation trend takes off. Craig Frederighi, Apple's VP of software engineering, made note of several partners Apple is working with for HomeKit. Among them, Marvell Technology (MRVL +1.91%) and Broadcom (NASDAQ: BRCM) have the potential to become a part of every connected device.
Source: Apple's WWDC presentation screen grab.
Apple may be just another hub for smart devices
Apple isn't the first to dream of complete home control via a smartphone. Google (GOOGL +2.53%) (GOOG +2.92%) introduced Android @ Home over three years ago. Google's protocol required an additional piece of hardware, which likely slowed adoption. As a result, it's had practically no impact on the market since its introduction.
Other technology companies have introduced their own versions of home automation software without much impact on the market. Apple is betting that the built-in market of millions of iPhone and iPad owners will entice hardware companies to work more closely with it to provide HomeKit compatible devices.
The bet may pay off. It might not. For Broadcom and Marvell, however, it doesn't really matter.
The point is that we're moving toward more smart devices that require connections to the Internet or a private network. If the Internet of things is a gold rush, Apple, Google, and their hardware partners are the gold diggers, but Marvell and Broadcom are selling the shovels.
Marvell makes it "EZ"
Just a day after Apple announced HomeKit, Marvell unveiled its newest solution for the Internet of things. The company introduced a series of microcontrollers for WiFi, Bluetooth, and Zigbee (a private network communication protocol) that feature Marvell's EZ-Connect software platform.
The goal behind the platform is to make it easier and faster for OEMs to bring connected home devices to market. The company is targeting "wearables, home automation, home security, personal health care, smart appliances, accessories and remote controls, automotive, lighting, industrial Internet, and more," according to the press release.
Is Broadcom broadening its portfolio?
Last year, Broadcom unveiled a Bluetooth SoC designed to integrate devices with Android powered smartphones and tablets. The open source code of Android allowed Broadcom to cater its design for Android devices. With the release of HomeKit, and Apple's announcement that it's working with Broadcom, it's not much of a stretch to think Broadcom could release a similar set of chips for iOS devices.
Broadcom already has a strong relationship with Apple. If it makes chips designed for HomeKit applications, it could easily win more designs than the competition.
Moreover, Broadcom's Wireless Internet Connectivity for Internet Enabled Devices, or WICED, platform is already designed to work with Apple products right out of the box. The company's history of working with Apple to help OEMs make products like smartphone controlled garage-door openers, shower speakers, and even meat thermometers bodes well for its future integration with Apple's HomeKit.
Just two examples
There are dozens of chipmakers closely tied with the Internet of things trend. Marvell and Broadcom are just a couple mentioned in Apple's presentation.
Additionally, both companies are diversified outside of facilitating the Internet of things. Marvell provides controllers for disk drives, and Broadcom has its datacenter business. Keep these factors in mind when considering an investment in one of the chipmakers.
