Qualcomm Inc, the world’s No. 3 chipmaker, yesterday said it is expecting strong demand for mobile chips from next quarter, triggered by handset replacement demand ahead of the release of China’s first fourth-generation (4G) licenses, a company executive said yesterday.
“We are seeing huge demand for [4G] Long-Term Evolution (LTE) chips as Chinese firms anticipate its launch at the end of the year,” James Shen (沈勁), vice president of Qualcomm’s business development unit for Greater China, said at a media briefing in Taipei.
“As such, a lot of electronics manufacturers are making LTE a requirement” for new products,” Shen said.
“They consider LTE-ready a good selling point,” he added.
To compete with MediaTek Inc (聯發科), Qualcomm began selling handset chips to China and other emerging markets such as Brazil, Russia and Indonesia two years ago under the Qualcomm Reference Design (QRD) program, an integrated mobile solution, or a turn-key solution, to help its customers shorten their time-to-market.
More than 40 companies have launched 200 mobile phones and tablets under the program, Qualcomm said. More than 100 more devices are in development, the company added.
ROOM FOR GROWTH
As 3G users only account for 31 percent, or 1 billion, of China’s total mobile subscribers, there is ample room for growth for both 3G and 4G services in the future, Shen said, citing statistics from market researcher Wireless Intelligence.
In addition, China’s three big telecom operators, led by China Mobile (中國移動), are heavily subsidizing 3G and 4G phones, which is also boosting demand, Shen said.
“Overall, demand will be very good in the second half [in China],” Shen said.
He said he does not expect a component shortage as happened at the end of last year as Qualcomm has come up with solutions to the problem.
Last year, short supply of touch sensors, micro controller units and other components curbed the shipments of some handset chipmakers.