Extract from the press release "SEQUANS Communications Secures USD 9 Million in VC Funding" on Sequans Website:
"Paris, France – February 22, 2005 – SEQUANS Communications, a fabless semi-conductor company in the 802.16/WIMAX space, today announced that it has secured and closed €7 Million (approximately $9 Million) in its Series B financing round from major Venture Capital firms. The round was led by UK-based Add Partners, and co-led by Vision Capital, a firm that specializes in Trans-Atlantic investments. Also participating in this oversubscribed round were SGAM, the investment arm of French bank Société Générale, and prior investors T-source and Cap Décisif."
I believe there is a typo in the press release, as it should be "I-Source" and not "T-Source".
In the "About Us" section of Sequans' website, it says that they address both base station and subscriber station products with both system-on-chip (SOC) and software solutions. Their WiMAX products are based on the fixed standard IEEE 802.16-2004, and moving forward they also plan to deliver a 802.16e solution (that's the mobile WiMAX standard).
Providing both base and subscriber station chips helps to avoid the chicken-egg problem (no base station chips - well then I don't even need to try to come up with a subscriber station set and vice versa). This was also why Intel initially designed the Rosedale chip for WiMAX (read the press release: Intel Discloses Key Emerging WiMAX Silicon Plans): the Rosedale is a chip for customer premise equipment, and for the equipment manufacturers, this is where the money is, due to the high volumes. While base stations can have high prices with costs ranging from $5.000 to up to $100.000, depending on size and complexity of the cell, which drives the requirements and hence the price for the chips, the business is limited, as there will be only a few: I remember roughly from one conversation with a WiMAX expert that it would take about 2 Million base stations to cover the whole world with a WiMAX network (standard IEEE 802.16-2004) - not exactly a huge business, and certainly not something of the size that would put it on Intel's radar.
It's different for the CPE or the handsets. Just think of all the mobile phones, notebooks, PDAs, data cards and smartphones in the world that have to be WiMAX-enabled. Just for mobile phones there is a huge opportunity, and they usually get replaced every 12-18 months, so the replacement cycle is quite short.
Sequans can serve both markets, and while the WiMAX Forum works on defining the specifications to ensure interoperability among vendors, going for the same vendor for the chips in the base and subscriber stations is a natural move, also for procurement reasons. So I would reckon that Sequans built their business case on the handset market.