Monday, July 25, 2011

Increasing back-to-school demand to boost PC and e-book reader sales

Sales of notebook, desktop and e-book readers, which are targeting education and document processing purposes, will have a chance to see a significant growth in the third quarter as demand for the back-to-school period, which usual starts from mid-July to mid-September in Europe and the US, has already started to appear, according to sources from PC players.

Several channel retailers in the US and Europe such as Amazon and BestBuy, have already started promotions for back-to-school shopping with products such as notebooks, desktops, e-book readers, printers and tablet PCs the major promotional items.

With e-book reader sales continuing to grow in the US and Europe, the global e-book reader market is expected to reach a scale of 20-30 million units in 2011, and as the largest e-paper supplier E-Ink expanded its capacity for the second half more than 1.5 fold that in the first half, strong demand from the back-to-school season will allow the e-book reader industry to be able to compete against the tablet PC market, the sources added.

Server platforms to become major battlefield between Intel and AMD

Observing from Intel and AMD's second-quarter results, growth from the traditional PC market has already weakened, while their server businesses, benefiting from the quick rise of cloud computing, are expected to become the major battlefield between the two firms in the future, according to sources from PC players.

Intel is performing rather strongly and achieved strong results in the second quarter from its Data Center Group, while AMD is set to challenge Intel with its upcoming server CPU architecture, Bulldozer, which will start shipping later in the third quarter, the sources noted.

Although Intel currently has about 80% share of the global server platform market, with AMD's upcoming new CPU architecture expected to significantly boost its price/performance ratio, the new CPUs should provide AMD a great chance to compete against Intel in the second half of 2011.

TSMC regaining more orders from chipset players

Taiwan Semiconductor Manufacturing Company (TSMC) has managed to regain more orders recently, aiming at sustaining a positive on-quarter growth in revenues for the third quarter, according to industry sources.

Foreign investors have recently reduced their share holdings in TSMC, expecting the foundry house to post negative growth in third-quarter revenues as its chipset clients have recently reduced some of their wafer starts due to inventory adjustments, the sources noted.

Recent financial results released by international chipset players also indicated that Nvidia, AMD, Broadcom and Qualcomm are all positive about their business outlook for the second half of 2011 after posting strong gains in the second quarter, said the sources, noting that TSMC's business is expected to move upward with those chipset players.

A positive on-quarter growth in the third quarter will also help TSMC to sustain its goal of achieving a 20% growth in revenues set for 2011, commented the sources.

Saturday, July 23, 2011

Nokia drops to third position in global smartphone ranking in 2Q11

Nokia may see its ranking in the global smartphone market drop from the number one position to third place in the second quarter of 2011 after the vendor reported its smartphone shipments declined 31% sequentially and 34% on year to 16.7 million units for the quarter, according to industry sources.

Apple has announced that it shipped 20.34 million smartphones in its fiscal 2011 third quarter which ended June 25, 2011. The shipments will allow Apple to take up an over 20% of the global smartphone market for the Aprpil-June period, the sources noted.

Samsung has yet to announce its results for the second quarter, but industry watchers project that Samsung's second-quarter smartphone shipments should reach 19-20 million units, trailing after Apple but ahead of Nokia.

Although Nokia did launched a number of new models based on Symbian platform in the second quarter, Nokia's sales and market share continued to drop sharply during the quarter, indicating that Symbian has lost its appeal to consumers, commented the sources.

HTC shipped 11.5 million smartphones in the second quarter, trailing after RIM to serve as the fifth-ranked vendor in the segment. However, HTC is expected to see its shipments increase 10-15% sequentially to 13-13.5 million units in the third quarter, which could further boost its ranking, indicated the sources.

China market: HTC launches social network smartphone with Sina

HTC has launched a customized version of its social network smartphone, the HTC Salsa, in the China market in cooperation with the local Internet company Sina, catering to users of Sina's Weibo microblogging services, according to the companies.

Given that the popularity of Weibo in China is much higher than that of Facebook, HTC has decided to cooperate with Sina to launch its social network smartphones so as to ramp up its penetration rate in the mid-range smartphone segment in China, commented industry sources.

The Weibo smartphone, the Weike (transliterated from Chinese), has a 3.4-inch HVGA touchsreen, 800MHz processor and a 5-megapixel camera, and also features a special button for easy access to Weibo.

Efun selects Applied Materials system for production of touch screen films

Taiwan-based Efun Technology, a manufacturer of critical components for touch screens, LCD monitors and backlight modules, has started to produce flexible substrates coated with indium tin oxide (ITO) films for touch panel screens. The ITO films were deposited using a SmartWeb system from Applied Materials, according to the equipment supplier.

This is the second SmartWeb system Efun has purchased from Applied for manufacturing its ITO touch panel components, the equipment maker indicated. The first system has been in production at Efun since 2009.

Applied's SmartWeb system is a roll-to-roll vacuum coater that uses physical vapor deposition technology to deposit the ITO-based multi-layer film stack required for fabricating the most advanced touch panels used in tablet PCs and other mobile devices, the company said.

"The latest generation of tablet PCs features 7-inch and larger projective capacitive touch screens, sizes that demand the highest quality and performance from the ITO substrate. Applied Materials was able to meet our technical specifications and aggressive timeline, providing the technology to meet our customers' requirements for high-end touch panels at a price that enables them to successfully compete in a demanding consumer market," said Kuang-Rong Lee, vice general manager, optoelectronics business unit leader, at Efun.

Intel reports fifth consecutive quarter of record revenues

Intel has reported its fifth consecutive quarter of record revenues, with double-digit revenue growth across all business segments.

On a non-GAAP basis, revenues were US$13.1 billion, operating income was US$4.2 billion, net income was US$3.2 billion, and EPS was US$0.59. On a GAAP basis, the company reported second-quarter revenues of US$13 billion, operating income of US$3.9 billion, net income of US$3 billion, and EPS of US$0.54.

The company generated approximately US$4 billion in cash from operations, paid cash dividends of US$961 million, and used US$2 billion to repurchase 93 million shares of common stock.

"We achieved a significant new milestone in the second quarter, surpassing US$13 billion in revenues for the first time," said Paul Otellini, Intel president and CEO. "Strong corporate demand for our most advanced technology, the surge of mobile devices and Internet traffic fueling data center growth, and the rapid rise of computing in emerging markets drove record results. Intel's 23% revenue growth in the first half and our increasing confidence in the second half of 2011 position us to grow annual revenues in the mid-20% range."

In the second quarter, Intel's PC Client Group revenues up 11% on year, while Data Center Group revenues were up 15% on year, Other Intel architecture group revenues were up 84% on year, including Embedded and Communications Group revenues, which is up 25% on year.

Intel Atom microprocessor and chipset revenues reached US$352 million, down 15% on-year.

The acquisitions of McAfee and Infineon Wireless Solutions (now Intel Mobile Communications) contributed revenues of US$1 billion in their first full-quarter of results with gross margin reached 61%, consistent with the company's expectation.

AMD sees profit in 2Q11

AMD has announced revenues for the second quarter of 2011 of US$1.57 billion, net income of US$61 million, or US$0.08 per share, and operating income of US$105 million. The company reported non-GAAP net income of US$70 million, or US$0.09 per share, and non-GAAP operating income of US$114 million.

In the second quarter, the company had a gross margin of 46% with its computing solutions segment revenues staying flat both sequentially and on-year. Sequentially, higher mobile processor revenues were offset by lower desktop and server revenues, while the on-year decrease was primarily driven by lower server revenues.

Meanwhile, graphics segment revenues decreased 11% sequentially and 17% on year. The sequential decrease was driven primarily by lower discrete mobile shipments and seasonality in the desktop discrete graphics add-in board market. The annual decrease was primarily driven by lower shipments.

For the third quarter, AMD expects revenues to increase 10%, plus or minus 2pp, sequentially.

MediaTek launches 4-in-1 chip targeting smartphones, tablets

MediaTek has rolled out a new 4-in-1 SoC solution designed for smartphones, tablet PCs and portable electronics devices. Dubbed MT6620, the solution integrates 802.11n Wi-Fi, Bluetooth 4.0+HS, GPS and FM transmitter/receiver on a single chip.

MediaTek said it is now shipping the new solutions to leading customers in sizable quantities.

MediaTek is believed to be one of the two in the industry to offer 11n/Bluetooth/GPS/FM combo chips for mobile technology devices, industry sources have claimed. A similar solution from Qualcomm is still in the development stage, the sources said.

The MT6620 is being identified as MediaTek's killer product, the sources indicated. The 4-in-1 SoC solution is able to save end device manufacturers at least US$2-3 in production costs compared to single chips integrating two to three functions, the sources said.

MediaTek chairman Tsai Ming-kai previously remarked that basic demand for current hot-selling items including tablet PCs and smartphones would remain in the third quarter, responding to speculation that the third quarter of 2011 is unlikely to enjoy peak season effects as seen in past years.

MediaTek saw its revenues grow 5.5% sequentially to NT$2.1 billion (US$72.7 million) in the second quarter, meeting the lower end of its NT$20.9-22.3 billion guidance range. Market observers expect the company's revenues to enjoy 15-20% sequential growth in the third quarter, citing brisk sales of its "value-added" 2.5G chipset solutions in emerging markets.

MediaTek is scheduled to hold an investors meeting on July 27 to discuss its performance in the second quarter, and provide its guidance for the third quarter.

Wednesday, July 20, 2011

Intel to launch new Celeron processors in September

Intel is set to launch several new Celeron processors for both desktops and notebooks in September, and will gradually phase out some existing Celeron models.

Intel will launch dual-core Celeron G540 (2.5GHz) and G530 (2.4GHz), and single-core Celeron G440 (1.6GHz) processors for desktop PCs with prices at US$52, US$42 and US$37 in thousand-unit tray quantities, respectively, and will gradually phase out six existing Celeron processors including E3500 and 450.

For notebook platforms, Intel will launch dual-core Celeron B840 and B800, and single-core Celeron B710 as well as an ultra-low-voltage single-core Celeron 787 processors with prices at US$86, US$86, US$70 and US$107.

For netbooks, Intel is set to launch dual-core Atom N2800 and N2600 CPUs with prices at US$47 and US$42, while for nettops, Intel will offer dual-core Atom D2700 and D2500 CPUs with prices at US$52 and US$42.

Although market watchers originally expected Intel to phase out its Celeron series processors due overlap with its Atom series processors, Intel, in the end, decided to use Celeron to guard its entry-level PC business and defend the assault from AMD's new entry-level APUs.

Google, Intel set to upgrade Chromebook performance

Google plans to upgrade the Chromebook design from originally adopting Atom N570 processors to mainstream Core i series processors to significantly boost system performance, while strengthening the machine's security. The plan has already received support from Intel with the company giving a 10-20% discount for related processor quotes, according to sources from notebook players.

In addition to Samsung and Acer, there are already several notebook vendors including Asustek Computer, already considering to join the upcoming Chromebook upgrade project and are set to launch related products after the fourth quarter, the sources noted.

The sources pointed out that despite the 12-inch Chromebook is mainly being pushed for its cloud computing capability, with most work being done by the back-end servers, since their hardware specifications are the same as a netbook, while being US$50-100 more expensive than a Windows 7-based netbook, and having an unattractive industrial design, the overall price/performance ratio is disappointing.

Therefore, Google has recently started notifying its partners that Chrome OS already has an obvious upgrade path for its hardware specifications and related security, while the company is also providing assistance with marketing and is aiming to push the product's price range to above US$500 and increase its attractiveness in the market.

However, some notebook vendors believe Android's success in smartphones and tablet PCs does not guarantee the success of Chromebook, and Microsoft still has an un-touchable position in the PC industry. Since most consumers are already used to Windows, while Windows has great software compatibility, if Chromebooks cannot outmatch Windows products on pricing, while maintaining standard performance demands, consumers are unlikely to accept a brand new operating system in the short term.

Tuesday, July 19, 2011

ARM to have big slice of notebook market in 2015, says IHS

After more than 30 years of domination by a single microarchitecture - Intel's X86 - the PC microprocessor (MPU) market finally is set for some real competition with shipments of ARM processors set to soar in the coming years and projected to appear in nearly one out of every four notebook PCs made in 2015, according to IHS iSuppli.

Spurred by next year's introduction of Microsoft's new ARM-enabled Windows 8 OS, ARM-based systems will account for 22.9% of global notebook PC unit shipments in 2015, up from 3% in 2012, IHS said. Shipments will reach 74 million ARM notebooks in 2015, compared to 7.6 million in 2012.

"Starting in 1981, when IBM first created its original PC based on Intel's 8088 microprocessor, the X86 architecture has dominated the PC market," said Matthew Wilkins, principal analyst of compute platforms for IHS. "Over the next generation, billions of PCs were shipped based on X86 microprocessors supplied by Intel and assorted rivals - mainly Advanced Micro Devices (AMD). However, the days of X86's unchallenged domination are coming to an end as Windows 8 opens the door for the use of the ARM processor, which already has achieved enormous popularity in the mobile phone and tablet worlds."

To be introduced in 2012, Windows 8 is expected to support ARM-based PC systems in some versions. Microsoft at the Consumer Electronics Show (CES) in January announced that Windows 8 would work with ARM-based system on chip (SoC) designs, whereas the company's flagship OS has supported only standalone X86 microprocessors in the past. ARM support will enable the full-fledged Windows PC OS to work on highly integrated chips that are more space- and power-efficient than traditional X86 microprocessors, such as the ARM devices used in smartphones and media tablets.

ARM during the next few years is expected to achieve its biggest successes in the value notebook segment, IHS believes. Typically priced at less than US$700, value notebooks are designed to deliver the optimal price/performance to consumers. A category that includes netbooks, value notebooks most frequently employ AMD's E Series and Intel's Celeron M and Atom microprocessors.

"ARM is well-suited for value notebooks, where performance isn't a key criterion for buyers," Wilkins said. "Value notebook buyers are looking for basic systems that balance an affordable price with reasonable performance. ARM processors deliver acceptable performance at a very low cost, along with unrivaled power efficiency."

The proliferation of ARM-based notebooks is expected to provide growth opportunities for a raft of existing as well as new suppliers of the chip, including Nvidia, Qualcomm and Texas Instruments (TI).

However, Intel and AMD are not expected to cede a portion of their market without a fight, IHS said. For example, Intel is developing its tri-gate 3D transistor technology, which allows X86 microprocessors to cut their power consumption in half while still delivering the same level of performance. This potentially will help Intel to maintain its position in PC processors, but also may allow it to expand its X86 business into tablets and cellphones. Likewise, AMD has been working to reduce power consumption for its X86 devices.

Acer, HP undergoing management reshuffle

Acer, on July 18, announced it has recruited Dave Chan, former Hewlett-Packard (HP) China vice president, as general manager of its Touch Business Group in China. Also, while company corporate vice president of marketing and brand Gianpiero Morbello will also reportedly resign from his position, with Acer's vice president Scott Lin to take over, Acer commented that it has no idea about where such a rumor came from.

Sources from PC players pointed out that the power of Acer's former CEO Gianfranco Lanci is gradually being phased out and the new team is aggressive recruiting talent to start over. High Tech Computer (HTC) former innovation design officer will reportedly join Acer's team, but the rumor was not confirmed.

For HP, due to HP's bad quality notebook issues in March 2010, HP China had already implemented a large personnel reshuffle of its high-end executives with Chan, who was employed by HP China for 16 years, resigning from HP in June.

Acer President, Jim Wong said at the company's announcement that "Touch mobile device is Acer's new strategic business. While China's huge IT market, with unique applications and customer segment, presents great business potential. To address these specific needs, we established a separate business group overseeing the China touch mobile device market and will allocate the needed human resource."

"Dave will lead Acer's touch business development team in China," continued Wong, "cooperate with local telcos and operators on R&D, software, sales and services. His joining ensures that Acer has substantial leadership to steer this new business forward in China."

Earlier, HP, on July 11, also announced it will transfer vice president of Personal System Group in America region Stephen DeWitt to president of global webOS business, while former CEO of Palm Jon Rubinstein will work as senior vice president.

Monday, July 18, 2011

Google to release Android 3.2 soon

Google is expected to release its Android 3.2 OS to production partners at the end of July or early August, according to industry sources. Asustek has indicated it will launch Android 3.2-based tablets soon, while Huawei Technologies also said it will roll out a 7-inch Android 3.2 tablet in the third quarter.

The Android 3.2 will improve the compatibility of Android-based applications, hardware acceleration capabilities and upgrade functions including Movie Studio, Movies, Music and Widget, while also optimizing Qualcomm's Snapdragon CPUs, indicated the sources.

In addition to Asustek's Eee Pad MeMO 3D tablet PCs, new tablet PCs to hit the market in the second half will include the 7-inch Iconia Tab A100 from Acer and the 7-inch MediaPad from Huawei, while HTC may upgrade its Android 2.3 HTC Flyer to Android 3.2, the sources added.

Asustek Transformer shipments top 400,000 units a month

Monthly shipments of Eee Pad Transformer tablet PCs from Asustek Computer have reached 400,000 units, making the company's goal to ship a total of two million tablet PCs in 2011 sustainable, according to sources at upstream panel suppliers.

Asustek's tablet shipments are expected to grow further in the third quarter, the sources said. The company has requested its touch panel providers supply a monthly target of 400,000-500,000 units during the quarter, the sources noted.

Asustek internally set a more aggressive goal for boosting its tablet shipments in 2011, the sources revealed. The company reportedly has placed contract orders of as high as 4-4.5 million units for the second half of the year, the sources indicated.

Asustek's tablets reportedly are assembled by Pegatron Technology.

In other news, Pegatron's June revenues grew 51.7% sequentially to NT$45.64 billion (US$1.58 billion), the highest since December 2009. Market watchers credited the significant on-month growth to strong sales of Asustek's Transformer devices.

Apple giveth, but iCloud taketh away from NAND flash market, says IHS

Apple in recent years has played a key role in expanding the market for NAND flash, but the company's newly-launched iCloud storage service could cause demand for the memory to weaken in the future, according to IHS iSuppli.

Driven by best-selling products like the iPad and iPhone, Apple is expected to remain the world's largest buyer of NAND flash memory in 2011 accounting for nearly 30% of global demand. Shipments of NAND flash memory for various Apple products are anticipated to reach 5.2 billion GB-equivalent units in 2011, out of a total global market of 18.5 billion GB-equivalent units. Apple's share of 28.3% represents the single largest block of NAND flash consumption by one company, IHS indicated.

Apple's portion will continue to climb during the following years, holding at 29% for the next two years, IHS said. Its share then will slide somewhat by 2015 but still will account for 23.9 billion GB-equivalent units, or one-quarter of overall industry NAND demand.

"Apple has contributed greatly to the growth of the NAND business in recent years," said Dee Nguyen, memory analyst at IHS. "However, the company's adoption of cloud storage could have significant implications because the fastest-growing segment of the NAND flash market lies in the storage component of convergent mobile devices like smartphones and tablets. And with Apple products like the iPhone and iPad accounting for a disproportionate share of NAND flash demand, any move among Apple users to offload storage to the company's iCloud service could mean a corresponding decrease in demand for physical NAND flash memory in the future."

For example, free storage of songs on iCloud theoretically would decrease the need for local storage on a PC, smartphone or tablet. If storage consumption decreased by 100GB per user – calculated at a rate of 4MB per song at Apple's stated cap of 25,000 songs of free storage – the combined effect from Apple's huge database of users could make a serious dent on NAND flash demand throughout the industry, IHS believes.

For the near and immediate term, however, the threat level to the NAND flash industry from cloud storage remains low, according to IHS. The most likely scenario for the time being is an increase in overall demand for NAND storage – cloud or local – with users continuing to utilize the physical storage on their personal devices.

A number of reasons support this view. For one, access to iCloud is currently available only through Wi-Fi, and with Wi-Fi not obtainable in all locations, users still will need to store content on their device to enjoy offline access. Moreover, recent high-profile security breaches at Sony, Sega, Nintendo and various government websites have focused renewed attention on data security in the public realm – likely making users more wary about storing content in centralized cloud locations.

A third factor, cost, also plays into the equation, IHS said. While a US$24.99 iTunes Match storage fee per year might be an attractive price to some, other consumers could balk at the idea of paying a yearly charge, compared to a one-time cash outlay in buying additional NAND flash memory for their device.

To be sure, consumers can overcome the cost factor, IHS said. But until issues surrounding data security can be adequately addressed – and more important, until Wi-Fi access becomes more widespread – the future for NAND flash memory remains relatively safe.

Monday, July 11, 2011

Digitimes Insight: Taiwan notebook shipments increase in 2Q11 thanks to Classmate PC

Taiwan-based notebook makers' combined shipments in the second quarter of 2011 reached 44.49 million units with a sequential increase of 8.5%, better than 5.6% growth of the same quarter a year ago. The shipment growth in the second quarter of 2011 was mainly due to the over one million units of Intel Classmate PCs ordered by Venezuela, while demand from the consumer notebook market remained low and Intel's defective chipsets incident, which caused delays in shipments of new notebook models, did not significantly benefit the notebook makers, according to Digitimes Research senior analyst Joanne Chien.

Japan's earthquake was originally expected to create bottlenecks in upstream component supplies, but it turned out that the impact was very limited with most vendors already capable of resolving the related issues.

Acer, among the notebook brand vendors, had the worst shipment performance. Comparing with other notebook brands, which all achieved shipment growths, Acer's notebook shipments dropped 5% sequentially in the second quarter due to its inventory issues. Acer's order volume in Taiwan's total notebook shipments in the second quarter dropped to only 15% and without counting volumes from netbooks, Acer's ranking in terms of orders to Taiwan notebook makers, dropped to fourth with Lenovo rising to second.

In addition to Classmate PC with over one million units of shipments, Apple's close to one million units of MacBook Air shipments, a growth of 300,000 units from the first quarter, also helped Taiwan makers' shipments in the second quarter. Apple's MacBook Airs, in the second quarter, accounted for 30% of Apple's total notebook shipments.

However, whether Intel Classmate PC's shipment growth indicates that netbook still have a chance to see shipment growth in emerging markets, and MacBook Air's popularity will help pick up the pace of development of Intel's Ultrabook concept will still need to wait until 2012 for further proof.

Asustek, Pegatron June revenues up

Taiwan-based vendor Asustek Computer generated non-consolidated revenues of NT$28.260 billion (US$978 million) for June, a 16-month high, while ODM Pegatron Technology's June consolidated revenues of NT$45.64 billion were a new monthly record, according to the companies.

HP to pioneer launching Ultrabook-concept notebooks, say sources

Hewlett-Packard (HP) is likely to pioneer all branded notebook vendors to launch Intel's Ultrabook-concept notebooks, even ahead of the planned release of the UX21 Ultrabook by Asustek Computer slated for September, according to sources at Taiwan-based suppliers for parts and components.

HP is expected to launch two, or more, models of Ultrabooks initially, using Intel's Ultra-thin Core i7-2677M (1.8GHz) and i7-2637M (1.7GHz) dual-core CPUs, said the sources, noting that HP will outsource production to Foxconn Electronics (Hon Hai Precision Industry) initially.

Foxconn reportedly has begun shipping the Ultrabooks to HP. However, HP and Foxconn both declined to comment.

Asustek's UX21 Ultrabooks are expected to come in with displays in 11.6- and 13-inch sizes, said the sources. Asustek is outsourcing the production of the UX21 Ultrabooks to Pegatron Technology.

Sunday, July 10, 2011

TSMC to lose Liang, says paper

Mong-Song Liang will resign from the faculty of National Tsinghua University (Hsinchu, northern Taiwan) at the end of July, and is ready for his new career at Korea-based Samsung Electronics, a Chinese-language Commercial Times report has claimed.

In an internal letter issued by Taiwan Semiconductor Manufacturing Company's (TSMC) R&D head Shang-yi Chiang, Chiang clearly pointed out that Liang has decided to join rival Samsung as its R&D VP, according to the report. TSMC also sent a notice to its employees saying that considering company competitiveness, TSMC does not wish to see any of its staff continue to have work-related exchanges with Liang, the report said.

Liang was formerly a senior director of R&D at TSMC's Advanced Modules Technology Division, and had worked for the foundry for about 17 years. Liang was one of the key figures assisting in TSMC's establishment of advanced process module development and traffic patterns.

Rumors have circulated since late 2009 that Samsung successfully headhunted Liang from TSMC. But so far, neither of the companies confirmed the rumors.

Rumors also spread previously that Liang might rejoin TSMC following the foundry's re-appointment of Shang-Yi Chiang as senior VP of R&D. Liang used to work under the management of Chiang.

Industry observers believe that Liang's work experience will help Samsung shorten the learning curve and solve yield issues. The leader in memory chip production reportedly is gearing up for a bigger share of the pure-play foundry pie.

Samsung recently announced it has qualified 28nm LP process with HKMG technology, and is ready for risk production. The company also introduced the addition of 28nm LPH HKMG targeted specifically at mobile device applications.

ZTE, Huawei, Lenovo monopolize China Mobile procurement of 10 million 3G handsets, says report

China-based vendors ZTE, Huawei Device and Lenovo have won China Mobile's latest procurement open bid to share the total supply volume of 10 million TD-SCDMA 3G handsets priced at about CNY1,000 (US$152), with no international vendors winning supply contracts, according to a report by the China-based National Business Daily.

TSMC 2Q11 sales meet guidance

Taiwan Semiconductor Manufacturing Company (TSMC) has reported NT$36.67 billion (US$1.28 billion) in consolidated revenues for June 2011, down 0.1% on month but up 0.9% on year. The foundry's second-quarter consolidated revenues amounted to NT$110.51 billion, which came within the company's guidance range of NT$109-111 billion.

TSMC's cumulative 2011 revenues through June totaled NT$215.89 billion, up 9.5% from a year ago.

Fellow foundry house United Microelectronics Corporation (UMC) collected NT$9.19 billion in revenues in June 2011, down 2.3% on month and 11% on year. Revenues for the second quarter were NT$28.15 billion, representing almost flat growth compared to the NT$28.12 billion posted in the prior quarter.

UMC previously estimated that shipments and ASP for the second quarter would stay flat sequentially. It did not provide guidance for revenues.

TSMC is scheduled to hold its quarterly investors meeting on July 28 followed by UMC's on August 3.

Nvidia delays 28nm and 22/20nm GPUs to 2012 and 2014

Despite Nvidia CEO Huang Jen-hsun previously saying that the company is set to announce its new 28nm GPU architecture at the end of 2011 and 22/20nm in 2013, sources from graphics card makers have pointed out that Nvidia has already adjusted its roadmap and delayed 28nm Kepler and 22/20nm Maxwell to 2012 and 2014.

The sources believe that the delay is due to unsatisfactory yield rates of Taiwan Semiconductor Manufacturing Company's (TSMC) 28nm process as well as lower-than-expected performance of Kepler.

TSMC originally expected its 28nm capacity at Fab15 to be available in the fourth quarter of 2011 and was set to start pilot production for its 20nm process technology in the third quarter of 2012.

However, TSMC's other major client Qualcomm, currently, still has not yet adjusted its 28nm process schedule and is set to launch three new products, 8960. 8270 and 8260A using dual-core Krait architecture in the fourth quarter of 2011.

Meanwhile, AMD will follow its original schedule and enter the 28nm era in the first half of 2012. The company's next-generation graphics chips Southern Island as well as Krishna and Wichita processors, which will replace the existing Ontraio and Zacate processors, and will all adopt a 28nm process from TSMC.

ViewSonic to launch 7-inch tablet running on Google Honeycomb OS

ViewSonic plans to launch the world's first 7-inch tablet PC running on Google Honeycomb OS soon. The 7-inch tablet will be powered by a dual-core Tegra CPU with a display solution of 1024 by 600 and support Wi-Fi technology initially.

The company pointed out that Google is currently working on optimizing its Android Market applications to allow them to better fit onto 10.1-inch tablet PCs, and is also working on resolving some issues with Android's compatibility on 7-inch tablet PCs. If Google is able to resolve the issues before the end of July, when the Taipei Computer Application Show will start, ViewSonic plans to start selling its 7-inch device at the show, and if not, the company will push pre-orders.

ViewSonic pointed out that smartphones have a high market penetration rate in Taiwan and any smartphone with Android 2.2 or above can be used as a wireless router for tablet PCs to connect to the Internet; therefore, the company will initially only push Wi-Fi support for its 7-inch tablet PC.

In consideration of markets such as India or Indonesia, which do not have a strong Wi-Fi environment as in Taiwan, ViewSonic, in the near future, will also launch 3G models to better serve these markets, the company noted.

Tuesday, July 5, 2011

PND demand growing in Asia, falling in Europe, North America

les volume of GPS PNDs (portable navigation devices) in the Europe market and that in the North American market in 2011 will decline by 10% and 30% respectively from 2010, but demand in the Asian market will grow considerably, according to industry sources in Taiwan.

The decreasing demand in Europe and North America is mainly due to replacement of GPS PNDs with smartphones, the sources explained. The global sales volume was estimated to drop from 45 million GPS PNDs in 2008 to 40 million units in 2010 and forecast to further slip to 35 million units in 2011, the sources pointed out.

The sales volume in the Asian market, although accounting for only over 10% of the global total, is on the rise, the sources indicated. In the China market particularly, there will be demand for 2.5-3.0 million GPS PNDs in 2011, the sources noted.

Unlike homogeneous markets in Europe and North America, markets in Asia are relatively unique and vary from one country to another, the sources pointed out.

Pegatron receives orders for 15 million iPhone 5s from Apple

Taiwan-based notebook maker Pegatron Technology is estimated to have landed orders for 15 million iPhone 5s (iPhone 4S) from Apple and is set to start shipping in September of 2011, according to sources from upstream component makers. In response, Pegatron declined to comment about its cooperation with clients.

Due to its cooperation with Apple for iPhone 4, Pegatron, in 2010, significantly expanded its plants, human power and equipment aiming satisfy the orders for 10 million CDMA iPhone 4s; however, since the Apple's CDMA iPhone 4 sales were lower than expected in the first quarter of 2011, Pegatron shipped less than four million CDMA iPhone 4s, causing the company's utilization rate to drop to only 50% with its gross margin also drop to 1.8% in the quarter.

The sources pointed out that as the iPhone 5, which does not seem to have any major update from iPhone 4, is already set for shipment in September, they are already started supplying components to Pegatron with Pegatron's plants in Shanghai, China also recently started hiring for manpower.

In addition to the iPhone, Pegatron has also been aggressive striving for iPad or Macbook orders from Apple, but due to the products' existing makers are defending their orders, Pegatron currently still has not yet achieved any progress. However, under the consideration of separating risks, some market watchers believe Pegatron will have chance to land a small volume of iPad orders in 2012.

Losing notebook orders from its major client Asustek Computer, Pegatron is currently working aggressively to land notebook orders from Acer with market watchers estimated that Pegatron will be able to land orders for more than six million notebooks in the second half of 2012, up from the two million units, currently.

As for dropping PS3 shipments, Although Sony already released information about PS4, the sources is still conservative about the new gaming console's shipments as the gaming market has recently been impacted strongly by online devices such as tablet PCs

Acer, Asustek turn marketing focus to China market in 2H11

Acer's notebook inventory clearance bringing a drop to mid-range and entry-level notebook models' average selling price in Europe by 40-50 euro, causing the Europe PC market to fall into price competition, so both Acer and Asustek Computer have decided to move their marketing focus to China in the second half of 2011, according to sources from notebook players.

The sources pointed out that Acer's inventory clearance not only impacted Acer's profitability, it also caused Acer's competitors to all follow suit and cut their notebook price to maintain market share. Since notebook players are selling their older notebook models with low prices in Europe to counter Acer, demand for higher priced new notebook models is relatively weaker.

With the notebook market in the US is facing an impact from the tablet PC, and the market status rather uncertain, the sources believe the US notebook market is unlikely to present strong growth in the second half of 2011.

Currently, Asustek has a 15% share in the China notebook market,and Acer is aiming to increase its market share in China to 13-15% in 2011 and surpass Asustek.

Monday, July 4, 2011

Notebook vendors take back chassis purchasing rights from ODMs

Global first-tier notebook vendors Hewlett-Packard (HP), Acer, Dell and Asustek Computer have all recently retrieved back their purchasing rights for notebook chassis from their notebook manufacturing partners and are placing orders directly with chassis makers hoping to secure supply capacity, according to sources from PC players.

Because Intel is aiming to boost the penetration rate of its Ultrabook concept to 40% of the consumer notebook market, the notebook players are concerned that Intel's strategy may cause serious shortages in metal chassis supply, and therefore, have decided to take back related purchasing rights.

The sources pointed out that most of the notebook brand vendors still keep the purchasing rights for the seven key components of notebooks including panels, CPUs, hard drives and batteries, leaving purchasing choice of smaller components such as chassis, cooling modules and hinges, to the notebook makers. But as ultra-thin designs are becoming a new mainstream specification, vendors are returning the purchasing rights for notebook chassis to their own departments to ensure smooth supply in the future.

Sources from chassis makers also pointed out that the notebook vendors have turned aggressive in contacting them recently and are already placing orders for the first half of 2012 to secure supply capacity. Their actions also indicate that demand for metal chassis will increase significantly starting in the first quarter of 2012.

To fulfill demand, chassis maker Foxconn Technology, which currently only has about 9,000 CNC machines for producing metal chassis, is set to purchase 10,000 more CNC machines in the near future, to significantly boost its capacity, while the other major chassis maker Catcher Technology also plans to expand the number of its CNC machines to 13,000-15,000 by the end of 2011.

In addition to chassis makers, notebook makers including Quanta Computer, Compal Electronics, Wistron and Inventec are also working more aggressively on vertical integration in chassis production to increase profitability.

Intel paying handsomely to attract downstream vendors into launching Ultrabooks

Intel has recently started planning a new marketing strategy for its Ultrabook concept and has invested heavily into the related budget and resources hoping to attract first-tier notebook vendors into developing Ultrabooks, according to sources from downstream notebook players.

Due to the failure of Intel's Consumer Ultra Low Voltage-based (CULV-based) ultra-thin notebooks in 2009, while the notebook market has been severely impacted by tablet PCs, most notebook vendors are taking a conservative attitude toward Intel's Ultrabook concept and Intel is hoping its heavy investment will be able to attract these vendors to launch Ultrabook products, the sources noted.

Intel announced its Ultrabook concept in June with a goal of having 40% of the global consumers notebooks using its Ultrabook concept at the end of 2012. Asustek is already set to launch its first Ultrabook concept-based notebook, UX21, in September.

Although Intel is providing a significant budget to support its partners launching Ultrabooks, the Ultrabook CPUs' rather high prices are currently still affecting downstream vendors' willingness to adopt as vendors are still concerned whether the Ultrabook product's prices can reach as low as US$1,000 as claimed by Intel. Although the vendors have already started testing Ultrabooks, most of them are still conservative about opening projects for production.

Currently, most of the vendors are monitoring Asustek's performance with its UX21 and will cut into the market when the timing is appropriate.

For the Ultrabook product line, Intel has recently launched four dual-core CPUs and is set to launch a single-core Celeron 787 CPU in September and Celeron 857 in the fourth quarter to replace Celeron 847, the sources added.

Friday, July 1, 2011

Apple likely to dethrone HP as leading portable PC vendor

Apple is likely to replace Hewlett-Packard (HP) as the global number one notebook vendor in 2012 if tablet PCs are included in the calculation of global notebook shipments, according to industry sources.

Global shipments of tablet PCs are expected to top 60 million units in 2011 with shipments from Apple likely to total 40 million units for a 60% share. And now some market research firms have predicted global tablet shipments are to top 80 million units 2012 with iPads accounting for 60 million units.

Additionally, Apple is also likely to ship 15 million MacBooks in 2012, bringing its combined shipments of notebooks and tablets to a total of 75 million units, accounting for 25-30% of the global notebook market, the sources estimated.

HP shipped 40 million notebooks in 2010 and is expected to ship 45-50 million units in 2011, noted the sources, adding that HP will not be able to compete with Apple for the tops title in 2012 based on its performance in 2010 and 2011.