Starboard has also called upon the company to cease work on the development of new products and to focus all of our resources on our legacy technology. We believe this demand shows a lack of understanding of the technology landscape, where companies must innovate or perish. The corporate graveyard is littered with tech companies that failed to improve and develop new products. Starboard is also demanding that DSP Group put itself up for a quick sale, with a focus on short-term returns and undermining shareholder value that would be generated and realized in the mid-term by executing on the existing growth initiatives.Up until now, DSP Group's main focus has been on providing wireless System-on-Chips (SoCs) for cordless DECT phones widely used in homes today, a market where we have a 70% market share. Recently, we expanded into SoCs targeting IP phones for office and businesses. We have quickly moved into third position in this product category, following Texas Instruments and Broadcom, and we are well positioned for strong revenue growth and market share expansion in this segment.* Based on market research reports and DSP Group internal estimates, there are approximately 45-50 million IP terminals sold each year and the number of units sold annually is growing in the mid-teens on a percentage basis, as more businesses replace old dual transfer mode phones with new IP based telephony systems.*
DSP Group Issues Letter To Shareholders Regarding Potential Proxy Contest
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