Cambridge Silicon Radio - which makes chips for 80 percent of the world's Bluetooth headsets - has promised better audio quality and longer battery life for Bluetooth devices by Christmas 2008.

The company is introducing Auristream, which uses a new voice codec in BlueCore6. This is its sixth generation of Bluetooth silicon, so devices can transmit voice at toll quality using a lower bit-rate - as long as both the headset and phone contain the chip. Otherwise, the chip falls back to the current codecs used by Bluetooth devices.

Without an improvement in voice quality, Bluetooth headsets would fall behind the voice quality of 3G phones, said John Halksworth, a head of product management at CSR. The new chips increase the MOS (Mean Opinion Score) voice clarity score from 2.46 for today's headsets, to 4.14 - the same voice quality that 3G phones using the AMR codec can offer.

"This will reduce the power requirement by 40 percent," said John Halksworth, head of product management at CSR. The chip uses the ADPCM audio codec, along with technology to make use of error-correction by retransmission, recently added to the Bluetooth standard. Reducing the bit rate from 64 kbit/s to 32 kbit/s means less power is needed.

There are also two new scan modes - conditional scan and casual scan - which can cut the power drain of an idle Bluetooth device by 86 percent, by only scanning when there is Bluetooth activity. These power figures will have most effect on headsets - adding an hour or two to the talk time and hours to the standby time. On a phone, Bluetooth only uses a tiny fraction of the power, so the impact will be smaller.

The chip also boosts the potential range and power, meaning handheld devices should be able to act as Bluetooth Class 1 devices. This could effectively give a phone's Bluetooth radio a range like a Wi-Fi hotspot, but is actually intended to make sure it has good contact through the body, if the user has a headset on one ear, and the phone in an opposite pocket.

The chip is coming first in a version for handheld devices, and later in one for headsets. Headsets have a much shorter product development cycle, so both should be available in products by Christmas 2008, said Halksworth.

It is not currently planned for any USB dongles, as that is a far smaller market than phones or headsets. Power consumption is also not such a key issue, and voice is only one application among many for those products, said Halksworth.

Despite its dominance, CSR is having to keep moving to stay ahead of the competition. Even CSR's own competitive analysis shows that the nearest competitor, Broadcom, can virtually match BlueCore6 in every department except the AuriStream voice codec.