marseilleMarseille Networks is coming out of stealth today and plans to launch new video chips for TVs. That, by itself, is nothing remarkable. But the company says it has designed those chips using a new kind of virtual prototyping tool that can cut the costs of chip development dramatically.

Designing custom chips can cost $15 million to $20 million, which is one reason that we don’t see that many new chip startups like Marseille. But Amine Chabane, chief executive, said in an interview that the company’s design tools can shave months off of the 18 months to two years that it takes to design chips — and save millions of dollars in the process.

For now, the company is keeping the technology to itself and using it to design it own video chips. Chabane says the company is launching three new video chips this year to show that its technology works. It has a test chip in a customer’s hands now.

The road will be tough. The Santa Clara, Calif.-based company has raised $5 million and has 20 employees. But companies such as Marvell, Broadcom, and Intel are investing heavily in video chips for TVs and other video-related products. Silicon Optix was a competitor, but its assets have been acquired by IDT and others.

On the design tool side, vendors such as Synopsys and Cadence have been making tools for years that are aimed at making the design process easier and less expensive. Chabane said that Marseille’s tools let chip designers see what the consequences of their designs are through simulation. They can try out different options to see how the chips work before they pull the trigger and send the design off to a chip factory.

“They can get the look and feel of the chip,” Chabane said. “You don’t have to gamble $15 – 20 million building the wrong product. Once the customers love the design, we go to mass production. That helps us mitigate risk.”

There are a lot of ifs here, to be sure. It sounds very similar to what hardware and tool companies already say they do with products such as field programmable gate arrays. Those FPGAs, however, are big, fat, “kitchen sink” chips. Designers can customize them to do exactly what they want, but the chips stay big and fat and expensive to fabricate. Chabane says that his tools let someone design a slimmer chip in a cost-efficient and completely custom way.

Chabane has been around a while. Before he co-founded Marseille in 2005, he held management positions at Conexant Systems and C-Cube Microsystems. If the technology works, then Marseille can expand its business and will have the option of licensing its design tools to others. The company isn’t yet naming its customers.