PortalPlayer is adding more software and semiconductor engineers at its development centre in Hyderabad, India, as the company diversifies from its mainline business of providing chips and software to the MP3 player industry.

PortalPlayer plans to add 100 more engineers in Hyderabad during this year, taking the total to about 250 engineers, said Gary Johnson, president and CEO of PortalPlayer, in an interview.

Hyderabad already accounts for about 50 per cent of PortalPlayer's worldwide engineering staff, and does full chip development, Johnson said. Some Hyderabad staff also support some of the company's customers in Japan.

The company is setting up a new facility that will open in October, and will be able to accommodate about 300 employees. The company's development activities in Hyderabad are currently spread over six locations, and the new facility will enable the company to consolidate its operations in one location, Johnson said.

Over 90 per cent of PortalPlayer's revenue comes from iPod-related work. The company is also diversifying into personal media displays, that will go into the lids of notebook computers, as a second 'always on' interface to content and information on the main system. PortalPlayer is also developing technology for wireless entertainment devices, Johnson said.