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News
Issue #2003 - 08 (March 2003)
(Updated Mar. 10, 2003)

TECHNOLOGY

TI & Intel Focus on Integrated Wireless Chipsets

Source: Aberdeen Newsletter

Recently, chip giants Texas Instruments (TI) and Intel made announcements regarding their efforts to produce integrated chipsets for wireless handsets. These designs are the wave of the future and Senior Analyst Isaac Ro of Aberdeen considers the two strategies against the current backdrop of the wireless handset marketplace.

Q: What are the technical reasons for pursuing an integrated chipset for wireless handsets?
A: There are three main technical reasons for incorporating an integrated chipset design into a wireless handset: 
Cost: Handsets that utilize an integrated chipset are cheaper and easier to build since multiple key components are built into a single board, thereby decreasing the bill of materials 
Power consumption: An integrated chipset places lower demands on the battery, which is the one key technology that is not keeping pace with other advances, in memory and processing power. 
Design: By consolidating various modules into a single board, engineers have greater flexibility in overall handset design, which is critical for differentiation in the current marketplace.

Q; What business advantages can be gained from integrated chipsets?
A: On the business side, these designs will allow a given vendor to lock up a customer at an early - and critical - stage. When a number of key components come integrated out of the box, you no longer need to go to multiple vendors to buy the radio, the flash memory, the digital signal processor (DSP), or the central processing unit (CPU). Most if not all of those modules are contained in one chipset. If chip manufacturers can win deals with any of the top ten players, who are doing close to 400 million handsets annually, that's a significant potential revenue stream.

Q: How important will these chipsets be in the short term?
A: Integrated chipsets are initially targeted at high-end devices that will feature built-in cameras, advanced browsing, and gaming capabilities. How practical and compelling are these early devices going to be and how soon will the chipsets cascade down to mass-market devices? In the realm of basic, voice-dominant handsets, there are a number of companies doing the modular pieces by themselves and selling to no-name vendors -particularly in China. The vendors take all these inexpensive parts, put them together and undercut the competition by selling a highly price competitive basic 2G digital handsets.

Q: How do the announcements from Intel and TI differ, if at all?
A: They have slightly different design approaches, but the same fundamental strategy. TI has been in the game longer and they recently set a major milestone, promising a fully integrated chip by the end of next year. On the flipside, Intel is leveraging its expertise in flash memory with its Manitoba chipset, which incorporates the flash, DSP, and CPU into one board. In both cases, the hope is that a major handset vendor, such as Nokia or Motorola, will jump on board and thereby legitimize a chipset in the eyes of the marketplace. It's not clear when that will happen, but repercussions for modular chipset players will manifest in the form of limited long-term growth prospects. 

Source: Aberdeen Newsletter

MobileInfo Comments and Advisory: We bring this Aberdeen newsletter clip that we received to our subscribers just to indicate that integration in chips is a trend that will help future products in the handheld sector. We see this trend not only in the handset sector but in PDAs and notebooks as well. It is too bad that handheld product designers who utilize integrated chips need to know much more than what Aberdeen or MobileInfo can tell them. For our enterprise-focused subscribers, it is just a trend that devices will become smaller and more power-efficient. 

 Note: This news release may contain forward-looking statements within the meaning of section 27A of the Securities Act of 1933 and section 21E of Securities Exchange act of 1934 in USA. Similar provisions exist in other countries. There is no assurance that the stipulated plans of vendors will be implemented. MobileInfo does not warrant the authenticity of the information. Readers should take appropriate caution in developing plans utilizing these products, services and technology architectures.  All trademarks used in this summary are the property of their respective owners.


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