MediaTek Inc (聯發科) yesterday said it is seeking to recoup its market position in the next one to two years by improving its handset chip’s cost structure and increasing its penetration into telecoms beyond China by tapping into new co-chief executive officer Rick Tsai’s (蔡力行) semiconductor experience.
The world’s No. 3 chip designer last year suffered a setback in terms of market share and gross margin, which it attributed to a host of factors, including chip supply constraints, key component price hikes and product planning flaws.
Unveiling its “recovery plan,” MediaTek chairman and co-chief executive officer Tsai Ming-kai (蔡明介) told a media briefing in Hsinchu that the company is developing a new cost-effective modem architecture to go with its mid-range mobile phone chips, dubbed Helio P series, and entry-level 4G chips.
Photo: Cho I-chun, Taipei Times
The new modem architecture is scheduled to hit the market in the second half of this year, which is expected to significantly improve the firm’s chip cost structure, Tsai Ming-kai said.
“The chips have been adopted by China’s first-tier handset vendors,” he said. “We hope the company’s gross margin and market share will pick up as a result.”
However, he said he does not expect “a V-shaped recovery” soon, because it usually takes one to one-and-a-half years to see a new chip’s yield results.
“This is a norm in the technology sector,” he said.
On top of that, MediaTek is working with key telecom companies in Japan and North America to broaden its customer portfolio beyond China, Rick Tsai said.
Last year, MediaTek clinched its first handset chip orders from Samsung Electronics Co and shipped its LTE smartphone chips to the US, the company said.
MediaTek shipped a total of 550 million chips used in smartphones and tablets last year, setting an all-time high.
Rick Tsai said he would help MediaTek find new growth drivers as smartphone growth slows down.
“The company needs to search for new growth engines beyond traditional application processors and system-on-chip solutions,” he said.
The catalyst for growth over the next two to five years would be total semiconductor content and applications for mobile phones, he added.
Asked when the company decided to recruit Rick Tsai, Tsai Ming-kai said he approached him in December last year after learning from news reports that he was to leave his post as chairman of Chugnhwa Telecom Co (中華電信).
Rick Tsai had previously served as president and chief executive officer of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s top contract chipmaker, from 2005 to 2009.
“I made a decision any chairman from the world’s top 10 semiconductor companies would do no matter what situation MediaTek was facing, good or bad,” Tsai Ming-kai said.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts