VIA sees opportunities in ultra-mobile device boom

Taiwanese chip designer VIA Technologies Inc (威盛電子) expects that its new chips for ultra-mobile devices (UMD), along with the gradual uptake of PC-like gadgets, will make a significant contribution to its revenues within the next two years, a company executive said yesterday.

Late last year, VIA launched its first batch of UMD chips, which compete against chip giant Intel Corp's ultra-mobile PC (UMPC) chips.

VIA's chipset business has been stagnant due to dragging talks to renew computer chipset royalty contracts with Intel.

"We will resolve this matter within a year at the latest," chief executive Wenchi Chen (陳文琦) said, in response to a reporter's question on the royalty talks with Intel.

Chen -- who denied newspaper speculation earlier this year that VIA would scrap its chipset unit as part of its ongoing restructuring efforts -- was upbeat about the chip designer's new UMD chips, saying that growth would be tremendous.

"We believe the UMD market will grow rapidly in the next one or two years. As one of the industry leaders, VIA will play a major role in this area," Chen said.

Global sales of UMPCs could grow to 100 million units by 2010, compared with 5 million this year and 2 million last year, VIA said, citing market researcher International Data Corp (IDC) forecasts.

For VIA, shipments of UMD chips would double next year, Chen said, without giving specific figures and declining to comment on whether the new products would lift VIA off the past four-quarter losses.

Chen made the remarks on the sidelines of the annual VIA Technology Forum featuring Ultra Mobile Life Style, during which VIA also unveiled its new VIA NanoBook UMD reference design outfitted with a 7-inch touch screen.

The company's UMD device packs the connectivity and functionality of a notebook PC into a sleek and light, ultra-portable clamshell weighing less than 850g.

At the Computex trade show, VIA is showcasing UMD and UMPC products made by its customers, including Taiwan's Gigabyte Technology Co (技嘉科技), European channel company Medion AG and US UMPC vendor O2O.

Running counter to VIA's optimism, IDC analyst Bob O'Donnell was conservative about sales of UMPCs, saying they were difficult to use.

"It is typically a product of a group of engineers who do not target any users. [To say nothing about] the high price tag," O'Donnell said last week in Taipei.