Taiwan WiMAX equipment makers diversify chip sources; Fujitsu aggressively soliciting partnerships

Irene Chen, Taipei; Esther Lam, DIGITIMES [Thursday 1 November 2007]

Taiwan networking equipment makers are diversifying their sources for WiMAX chips and Fujitsu, who used to dedicate more focus on Japan's WiMAX market deployment, is aggressively growing its exposure to Taiwan vendors.

Makoto Awaga, general manager of mobile solutions division, electronic devices group, Fujitsu, said the company is gradually increasing partnerships with related equipment suppliers from Taiwan over mobile WiMAX deployment. He anticipated that a highly-integrated 802.16e solution for handsets that supports an external miniSD card slot will be available in 2008.

Michael Shih, Fujitsu Microelectronics Asia Pacific CEO, added in saying that the company has not been out of the the market after the IEEE 802.16e standard was confirmed, but instead has been closely observing market trends over the past two years. The company launched a complete 802.16e solution in 2007 and established partnerships with Taiwan companies including Deltra Networks and Mototech, he noted.

Given that WiMAX is on open standard, Shih emphasized that Fujitsu will forge more aggressive partnerships with regional equipment suppliers, and Taiwan is one of the key regions that the company is eying.

Taiwan WiMAX equipment makers highlighted a trend of having more than two chip suppliers emerged in 2007, contrasted to being reliant on a single chip supplier over the past two years. Technology strength and price are the two fundamental criteria when choosing chip vendor, they pointed out.

Reviewing the present partnership of Taiwan WiMAX equipment makers and chip suppliers, equipment makers including Cameo Communications and Gemtek Technology both have more than two chip suppliers. Accton Technology, Alpha Networks, Quanta Microsystems and Zyxel Communications are also aggressively seeking more chip suppliers, the industry players said.

Gemtek chairman Howard Chen said the company started adjusting its business strategy to have multiple WiMAX chip sources from the second half of 2006. Cameo CTO KF Wu, on the other hand, said the company will remain as having two WiMAX chip suppliers. The CTO added in saying that it is not likely to have too many chip suppliers due to company's corresponding technological support resources.

With most Taiwan WiMAX equipment makers highlighting the importance of price when selecting suppliers, Awaga from Fujitsu echoed these remarks and said he expects the cost of WiMAX cards to drop below US$100 in 2008. External WiMAX cards with a smaller size may even have their cost reduced to US$70-80 in the same period, he added.