Tuesday, June 28, 2011

Compal Communications smartphone shipments to be boosted by Nokia orders

Taiwan-based ODM maker Compal Communications shipped only 3.91 million smartphones in 2010 and has downward adjusted 2011 target shipment volume from 6.0 million smartphones to 4.5 million, but stands a chance of shipping 10-15 million smartphones through reliance on Nokia, according to industry sources in Taiwan.

Compal's shipments of Android, WebOS and Windows Phone 7 (WP7) smartphones to Nokia, Motorola, Hewlett-Packard (HP)and Acer in the first quarter of 2011 accounted for 70% of total shipments and 85% of total revenues, the sources indicated.

Compal has relatively strong R&D capabilities among Taiwan-based handset ODM makers as well as supporting resources from the Compal Group, but many ODM orders for smartphones are in too small volumes to reach an economy of scale, the sources said.

As Compal will begin shipping Mango (an update edition of WP7) smartphones to Nokia in the fourth quarter of 2011, Compal is likely to see a large increase in ODM orders from Nokia in 2012 if Mango smartphone models sell well in the global market and Nokia keeps downsizing its in-house R&D staff and strengthen ODM partnership with Compal, the sources analyzed. If so, Compal is expected to obtain orders for Mango smartphones from other vendors as well, such as Acer and LG Electronics, the sources indicated.

Compal has signed with Microsoft for licensed use of the Mango platform and Tango, a platform to succeed Mango, the sources noted.

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