Contributors: Bob Wheeler, Jag Bolaria, Joseph Byrne In This Issue
Our new report A Guide to Wi-Fi/Bluetooth Connectivity Chips is now available. Learn about the newest connectivity chips for handsets, combining Bluetooth and Wi-Fi, as well as standalone Wi-Fi chips for mobile applications. Order your copy today! Earlier this month, cell-phone leader Nokia shook up the handset-processor market by announcing a new strategy: rather than rely exclusively on Texas Instruments, Nokia will add a second supplier at each technology level. The company announced that it has awarded design wins to Broadcom for EDGE and to STMicroelectronics for next-generation 3G phones. It had previously announced Infineon as a supplier for low-cost GSM phones. The choices of Infineon and Broadcom are the result of a careful evaluation of all available merchant processors. As we pointed out in our recent report, Infineon's E-GOLDvoice is the lowest-cost GSM solution available today, and Broadcom's BCM21331 rivals TI's eCosto as the best choice for EDGE feature phones. Nokia did not announce the specific chips that it will use, but it will begin to ship phones with Infineon processors in 1H08 and with Broadcom processors in 2H08. For WCDMA, Nokia rejected the obvious technical choice, Qualcomm, presumably because of the intense animosity between the two companies. Nokia also appears less willing to use off-the-shelf technology in the emerging 3G market than in the mature 2G market. The handset vendor currently uses internally designed basebands (manufactured by TI) in all of its 3G handsets. To fulfill its dual-source strategy, Nokia will license its baseband technology to ST (see next item) and eventually purchase the resulting 3G processors. ST is a long-time supplier to Nokia, providing RF components, Bluetooth, Wi-Fi, application processors—just about everything but the baseband. Because of the time required to design a new processor, Nokia will not begin shipping phones using this chip until 2010. Although Nokia will transfer a chip-design team to ST, it will retain a sizable R&D organization that will continue to advance its core 3G technology. This announcement rewards Broadcom's technical excellence and makes the company, which has less than 1% of the baseband market today, a significant player. Infineon will also gain share. TI is the clear loser, but we expect Nokia to move slowly, giving its new suppliers perhaps 10% of its GSM/EDGE business at first and increasing that share as they prove themselves. Furthermore, TI will have Nokia's high-revenue and fast-growing 3G business all to itself for two or more years to come. Thus, the near-term impact on TI will be minor. In the long term, however, Nokia's new strategy will create a more competitive baseband-processor market by diluting TI's position and boosting some of the smaller players. It also sets up Nokia as a kingmaker, using it massive market share to choose which baseband suppliers thrive. —Linley A detailed comparison of Broadcom, Infineon, and TI baseband processors appears in our recent report A Guide to Wireless Handset Processors. In a related announcement, STMicroelectronics said it will develop 3G processors using baseband technology licensed from Nokia. The license includes a software stack as well as an advanced 3G baseband design. ST will also receive approximately 200 chip-design engineers from Nokia to assist in developing these processors; this team is expected to transfer in 4Q07, after the approval of labor groups in the U.K. and Finland. The companies did not disclose the financial terms of this agreement. ST says the initial product will be an HSPA chip set implementing UMTS Release 7. The processor will be built in 45nm CMOS technology and will combine Nokia's baseband with ST's Nomadik application processor. The chip set will include a separate RF transceiver (based on ST's existing designs). ST expects this processor to sample in late 2008 and enter production in Nokia handsets in 2010. According to the companies, the license allows ST to sell these processors, along with the software, to any handset vendor. Nokia, however, is the lead customer and the clear focus of this arrangement. Once ST can satisfy Nokia's needs, it can offer the processor as a merchant product. With its portfolio of RF and connectivity products, ST could offer complete handset solutions around its 3G processor, but we believe it will be 2011 before this happens. As announced last year, ST is also partnering with EMP to offer 3G processors. In this arrangement, however, EMP designs and sells the processors while ST manufactures the chips. ST says it will continue its partnership with EMP, but the Nokia arrangement provides similar technology with more flexibility for ST. If ST offers the Nokia-based product on the open market, it will be competing against EMP. Thus, we expect the new product, once it is available, to supercede ST's relationship with EMP. —Linley Complete coverage of ST's Nomadik and EMP processors appears in our recent report A Guide to Wireless Handset Processors. Last week, Infineon revealed plans to acquire the former Agere wireless business from LSI for $450 million. LSI received this business as part of its April 2007 acquisition of Agere, but LSI was more interested in Agere's other product lines. According to The Linley Group, Agere's Vision products held 4.4% of the cellular baseband market in 2006. In the first half of this year, the business generated $186 million, about the same pace as last year. The combination of Agere and Infineon totaled 7.0% share in 2006 and would have ranked as the fourth largest baseband vendor. Infineon has key design wins at Nokia (see above) and LG; the addition of the Vision products makes Infineon a major supplier to Samsung as well, giving it access to three of the Big Five handset suppliers. One of the problems for the Agere baseband business was its lack of complementary products, such as RF and connectivity. Infineon, in contrast, is the leading RF supplier and offers Bluetooth, GPS, and other connectivity chips. Infineon is already the RF supplier for many Agere platforms; the acquisition extends this partnership. The Vision products overlap (and are generally inferior to) Infineon's own GSM and EDGE baseband processors. In the near term, Infineon plans to support both product lines to ensure that it retains Samsung and other Agere customers. The challenge for Infineon will be to integrate Vision into its roadmap in a way that avoids duplicate R&D costs. Although the company would not comment on its long-term plans, we expect Infineon will not invest in Vision follow-ons beyond what is already underway. Instead, the company could migrate Agere's OptiVerse software to its own processors, providing a software-compatible upgrade for Agere's customers. In addition, Infineon can use Agere's resources to beef up its 3G development effort and attempt to win 3G business at Samsung and other OEMs. The added market share gives Infineon the scale it will need to sustain a profitable wireless business. With its new bulk and momentum for the future, Infineon has separated itself from the pack, making it a likely winner as the baseband market continues to consolidate. —Linley Complete coverage of the LSI/Agere and Infineon processors appears in our recent report A Guide to Wireless Handset Processors. As mobile TV emerges as a viable form of portable entertainment, it is untethering consumers from their living rooms. Mobile-TV receivers are being designed into handsets, media players, navigation systems, and PCs. The prospect of integrating mobile-TV receivers into these devices could boost the total market to 100 million units within a few years. This opportunity has lured more than a score of suppliers into the market. This transition has been facilitated by the development of new digital specifications to improve receive performance and reduce power consumption. Despite these advances, the market remains chaotic. Different broadcasters use different specifications and, to date, no single specification has been adopted as a worldwide standard. Deployment plans vary because of spectrum availability and other issues, while various business models are being attempted. Japan and Korea have seen rapid uptake of their 1Seg and T-DMB services that are available at no charge and carry well-known shows. Fee-based services and those with limited content have taken off more slowly. A Guide to Mobile TV Chips provides in-depth coverage of TV receivers from suppliers such as DiBcom, Siano, Telegent, Analog Devices (Integrant), Broadcom, Qualcomm, Texas Instruments, and Afa Technologies. The report explains the plethora of standards, such as DVB-H, ISDB-T 1Seg, T-DMB, and MediaFLO, clarifying their differences and explaining the common technologies behind them. It also discusses the design of receiver chips and outlines future trends. The report analyzes the market opportunity for mobile TV ICs, discussing the inhibitors and accelerators of adoption. The Linley Group analysts Joseph Byrne and Linley Gwennap deliver a comprehensive look at the emerging mobile TV market. Their technology and business analysis helps you zero in on the right mobile TV chips for handsets, portable media players, PCs, and other mobile systems. Whether you are looking for an innovative design solution, a vendor to partner with, or a rising company to invest in, this report will cut your research time and save you money. Accelerate your learning. Order A Guide to Mobile TV Chips today. To receive Linley on CE via e-mail, you must register on our web site
|
