Inventec eyes 20% of handset market

Inventec Appliances Corp (英華達), a Taiwanese handset maker known for its OKWAP brand, expects to undercut its rivals by securing a 20 percent market share in Taiwan next year, a company executive said yesterday.

To fit that bill, Inventec Appliances' handset sales in Taiwan are expected to double to 1.2 million units next year from this year, said Jesse Lee (李忠義), Inventec's marketing and sales director.

"We plan to pitch 10 new models in the Greater China region in 2004 with all of them equipped with color screens and built-in cameras. We believe the complete product line will help us achieve that goal," Lee said.

Inventec Appliance, a handset manufacturing arm of Inventec Corp (英業達集團), is expected to sell 600,000 OKWAP mobile phones this year by grabbing about 10 percent of local market share, said Richard Yeh (葉力銓), an Inventec senior manager.

"Thanks to the sliding market share of European and US mobile phone vendors, including Motorola Inc and Nokia Oyj, Taiwanese companies including Inventec Appliances and their larger South Korean rivals have the potential to see further market expansion next year in Taiwan," Yeh said.

Not only have Nokia and Motorola seen market share decline to around 20 percent from 25 percent, Samsung Electronics Co has also been outranked by Taiwan's BenQ Corp (明基電通) in the third quarter.

"It'll be a fierce fight for market dominance between Taiwanese and South Korean cellphone brands, since growth in the local handset market will be limited next year," he said.

The local mobile-phone market will only show slight growth to hover at around six million units in 2004, said Marty Kung (龔俊光), an industry analyst at Market Intelligence Center (MIC), a semi-official research house in Taipei.

Commenting on Inventec Appliances' goal of grabbing 20 percent local market share, Kung said "it will be a challenge."

Kung attributed a lack of new models from its international rivals Motorola and Nokia during the second and third quarters as the reason behind Inventec Appliances' strong market position.

But this favorable factor was likely to disappear next year, Kung said.

In addition to those European and US rivals, South Korean handset makers are also poised to take more desperate steps to boost their market share by working together with local telecom operators, he said.

LG Electronics Inc will provide its new camera clamshell phone at a lower price in cooperation with Chunghwa Telecom Co (中華電信) -- a step that Korean vendors rarely took in the past, Kung said.

"We don't exclude the possibility that Samsung Electronics will follow suit," he said.

"Strong brand positioning and product design are crucial for local handset makers to win the fight," Kung said.