The Company AMS AG has introduced the non-contact AS5601 Hall-based rotary magnetic position encoding chip. It works by sensing changes in the magnetic field components perpendicular to the surface of the chip and converts field changes into voltages to produce incremental A/B outputs and absolute position information that can be read over an I²C bus. Analog signals from the built-in Hall sensors are amplified and filtered before conversion to binary values.
A hardwired CORDIC block (Coordinate Rotation Digital Computer) calculates the angle and magnitude of the magnetic field vector. Magnetic field intensity is used by the automatic gain control (AGC) to adjust the amplification level which compensates for temperature and magnetic field variations.
For more detail: New Rotary Encoder