Cage Chao, Taipei; Esther Lam, DIGITIMES [Wednesday 16 January 2008]

While MediaTek’s sales guidance trim raises concerns over white-box handset demand trends from China in the first quarter of 2008, some IC design houses from Taiwan project that the demand will stabilize after the Lunar New Year in early February.

MediaTek, which has strong sales exposure to China-based white-box handset makers, said the slow demand from its customers is a reflection of the China government’s macroeconomics control policy. The number one design house in Taiwan projected that demand from these customers should warm up after the Lunar New Year.

Sources at white-box handset makers echoed MediaTek’s sentiment, saying that the control does pose a stronger impact over companies that have an unstable sales record. When the cost for securing investment funds grows, and demand does not trend as strong as expected, many of these companies hold off their procurements for components.

When the inventory effectively eases after the Lunar New Year, demand is expected to resume growth amid the effect of the upcoming Beijing 2008 Olympics.

Some industry players highlighted that the growing popularity of handsets supporting dual SIM cards has added to the volatility. Demand for these handsets soared in the third quarter of 2007 as evident in the over 45% sequential sales growth at MediaTek in the quarter. Quarterly handset chips shipments hit 40-50 million units also, the players noted.

However, as demand for these handsets was not sustained, MediaTek thus requires a longer-than-expected time to clear its inventory, they remarked.

Press release, January 10; Adam Hwang, DIGITIMES [Thursday 10 January 2008]

Synnex Technology International, the largest 3C (computer, communication, consumer electronics) channel distributor in Taiwan, on January 9 reported estimated consolidated revenues of NT$15.27 billion (US$470 million) for December 2007, with the resulting whole-year figure of NT$170.9 billion for 2007 growing by 20.1% on year.

Of the consolidated revenues for all of 2007, 70% came from overseas markets, higher than the 63% posted in 2006, Synnex Technology indicated. This was mainly due to fast growing sales in China, Australia and Thailand, the company noted.

Synnex Technology’s consolidated revenues of NT$44.6 billion for the fourth quarter of 2007 was the second highest on record for the company.

Source: Company, compiled by Digitimes, January 2008

Daniel Shen, Taipei; Steve Shen, DIGITIMES [Wednesday 9 January 2008]

A number of Taiwan handset makers have voiced varied views about Google’s Android handset platform, with Wistron NeWeb planning to join the Android club soon. Inventec Appliances and Asustek Computer, however, are not ready to make a commitment to the platform at the moment, according to sources at the companies.

Wistron NeWeb, following in the steps of High Tech Computer (HTC), plans to start designing an Android-based system in March, and projects to begin shipping Android-based handsets to branded vendors in the second quarter of 2008, said company sources.

Wistron NeWeb is featuring a Linux-based GSM/Wi-Fi dual mode phone prototype, the GW4, at the ongoing 2008 Consumer Electronics Show (CES) in Las Vegas. The GW4 prototype is built on MontaVista’s Linux platform and is powered by a Texas Instruments (IT) OMAP 1710 processor. The dual-mode phone also features a 2.5-inch touch-screen, a QWERTY keypad, a 2-megapixel camera, and Wi-Fi and Bluetooth connectivity, the sources detailed.

Inventec Appliances, presently, will continue to focus on the development of Windows Mobile smartphones, and the company may support Android in the future since it has already established Linux R&D teams in Shanghai and Nanjing, according to company chairman Jackson Chang.

Asustek will also focus on Windows Mobile smartphones and the company has no plans to enter the development of Android handsets in the near future due to concerns about the supply chain in the Linux ecosystem, according to sources at Asustek.

Kaddy Chung, Taipei; Steve Shen, DIGITIMES [Thursday 10 January 2008]

Chunghwa Telecom (CHT) on January 9 stated that it will install more 3.5G base stations in Taiwan in order to help boost the number of its 3G subscribers to 3.5 million by the end of 2008, up from the current 2.3 million.

CHT said that it plans to build an additional 800 3.5G base stations supporting download data rates of up to 7.2Mbps in 2008. CHT currently boasts a total of 4,500 3G base stations throughout Taiwan, including 4,000 ones that support the 3.5G standard.

In addition, CHT will begin installing 3.5G base stations supporting download data rates of up to 10.7Mbps from the third quarter of this year, the company indicated.

As part of its efforts, CHT on January 9 launched its own-brand CHT 3000 3G handset in Taiwan. CHT will offer the CHT 3000, or the LG KU250 and Samsung J208 as options, free of charge to subscribers who sign up for a two-year contract with a subscription rate of NT$383 (US$12) a month. CHT declined to reveal the contract maker of the CHT 3000.

In other news, CHT expects its mobile revenues to top NT$76 billion in 2008 compared to NT$75.5 billion in 2007.

CHT’s new own-brand 3G handset, the CHT 3000
Photo: Kaddy Chung, Digitimes, January 2008

Daniel Shen, Taipei; Emily Chuang, DIGITIMES [Friday 11 January 2008]

After Telefonica Group’s sale of O2 Asia Pacific to Mobile and Wireless Group (MWG), the suppliers of MWG (ex-O2 Asia) will change, according to industry sources. Asustek Computer and Quanta Computer will no longer make handsets for MWG while Gigabyte Communications and Arima Communications will become its major suppliers, the sources added.

MWG recently introduced new own-brand mid-range and high-end smartphones. The new handsets support 3.5G and GPS, with availability to begin in March or April. The Atom V and Zinc II are made by Gigabyte Communications and Arima Communications, the sources noted.

High Tech Computer (HTC) was the original supplier to O2 Asia before HTC turned to focus on its own-brand business. O2 Asia then shifted its partnership to Quanta and subsequently added new suppliers such as Asustek, Arima Communications and Gigabyte Communications. With Quanta losing part of its R&D team and Asustek turning to focus on the own brand sector, their ties with the company will be reduced.

Kaddy Chung, Taipei; Adam Hwang, DIGITIMES [Friday 11 January 2008]

Chunghwa Telecom (CHT) on January 10 reported revenues of NT$15.567 billion (US$479.2 million) for December 2007, with the resulting revenues of NT$186.323 billion for 2007 exceeding the year goal by 2.2%.

CHT had about 4.25 million subscribers of ADSL and FTTx (fiber to the home/building) in total at the end of last month. Of the ADSL subscribers, 1.2 million used bandwidth of over 8Mbps. In addition, CHT had 2.29 million subscribers of 3G mobile communication services at the end of December.

Taiwan Mobile (TWM) and Far EasTone Telecommunications (FET), the other two of the top-three operators of mobile communication services in Taiwan, on January 10 released their financial figures for last month also.

TWM explained that the pre-tax and net losses for December were because the company scraped worn-out assets and accordingly reported a total non-operating loss of NT$11.17 billion.

Source: Company, compiled by Digitimes, January 2008

*Earnings before interest, tax, depreciation, amortization
Source: Companies, compiled by Digitimes, January 2008