Nokia expected to expand partnerships with Taiwan handset chip solution vendors

Following announcements by Nokia about a reshuffle in its chipset development strategy in 2007, industry players, who generally anticipate that Nokia will grow its component procurement flexibility and proportion, expect that Taiwan-based IC design houses will benefit from the move.

Nokia announced in August 2007 a collaboration with STMicroelectronics, enabling STMicroelectronics to design and manufacture 3G chipsets based on Nokia's modem technologies, energy management and radio frequency (RF) technology and deliver complete solutions to Nokia and the open market.

The Finnish handset vendor had also announced in August a renewal of its chipset development strategy by introducing a licensing and multisourcing model. Under this new strategy, Nokia is now working with four chipset suppliers. Texas Instruments (TI) continues to be a broad scope supplier across all protocols, Broadcom is as a supplier for EDGE technology, Infineon Technologies is a supplier for GSM, and STMicroelectronics is a supplier for 3G.

Industry players are positive about Nokia's reshuffle in chip development, as the reshuffle implies more business opportunities. Among different IC design sectors, LCD driver IC design houses, including Himax Technologies and Orise Technologies, are expected to see a big boost in their 2008 second-quarter sales amid orders from Nokia, according to industry sources.

Several other Taiwan IC design houses are making progress in potential deals with Nokia, including Elan Microelectronics, MediaTek and Richtek Technology. Negotiations are underway with shipments expected to begin from the second half of 2008 at the earliest, the sources remarked.

Nokia is interested in Elan mainly because of the the attractive quotes the company offers for touch screen modules, the sources explained. Apple's iPhone touch panel costs about US$18, but a similar solution from Elan costs only US$10-12, they noted.

MediaTek is in talks with Nokia about partnering over baseband and RF platforms, while Richtek is likely to supply LED driver ICs and power management (PWM) ICs to Nokia, the sources detailed.

Silicon Touch Technology Incorporated (SiTI), Fitipower Integrated Technology and Weltrend Semiconductor are three design houses that are expected to supply Nokia with ICs for camera lens zoom via module makers, the sources added.

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