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Growing Competition: Chipset vendors prepare to meet the demand for LTE devices

March 31, 2014

Major mobile chipset vendors have been gearing up to meet the growing demand for LTE (long term evolution)-enabled mobile devices over the past two years. According to a GSMA Intelligence report, the number of LTE connections is expected to cross 1 billion by 2017 and around 47 per cent of the demand is expected to come from markets like India and China. This implies a significant increase in the demand for LTE-based smartphones and devices, which will drive the market for 4G chipsets.

Global handset vendors like Samsung, Nokia, HTC, LG, Apple and Motorola have already launched a range of LTE-enabled devices. Indian handset manufacturers are also likely to introduce 4G-enabled devices in the near future. According to reports, local manufacturers like Xolo are working on a 4G LTE-enabled smartphone. The country’s second largest mobile manufacturer Micromax plans to launch 4G-enabled devices by end-2014. Also, Karbonn is testing 4G-enabled devices.

It is, therefore, not surprising that major chipset vendors like MediaTek, Broadcom, Intel, Spreadtrum and Qualcomm are pulling out all the stops to gain a foothold in this market.

According to research firm Strategy Analytics, Qualcomm has around 95 per cent revenue share in the LTE baseband segment. The company’s Snapdragon chip family continues to gain strong foothold as it was the preferred supplier for top-end smartphones launched by Google, LG, Motorola, HTC, Nokia, Samsung, Xiaomi and Sony. The US-based chip manufacturer has introduced the Snapdragon 410 chipset with integrated 4G LTE world modes that support dual and triple SIMs for low-priced smartphones that will be launched in 2014-15. The Snapdragon 410 will be paired with Qualcomm’s RF360 chip, with the full package delivering Wi-Fi, Bluetooth, FM and NFC (near field communications) functionalities, and support all major navigation tools like GPS, GLONASS and BeiDou.

Qualcomm’s leadership in this market can be partly attributed to its early investments in developing 4G chipsets. It has reportedly spent over $14 billion in research and development over the last four years. Others players in the space are also catching up.

In August 2013, Intel purchased a unit of Fujitsu, Fujitsu Semiconductor Wireless Products, a specialist in radio frequency transceiver technology, in a bid to increase its LTE and overall mobile expertise. Intel started shipping its first multimode LTE modems in October 2013. Intel’s XMM 7260 modem, which will deliver LTE Advanced features such as carrier aggregation, is expected to be available for commercial devices in the first half of 2014.

In January 2014, Taiwan-based MediaTek unveiled its first multimode LTE chipset, the MT6290. MediaTek is planning to get its LTE chips tested through all carrier labs in the first half of 2014 so that they are available for commercial use in the second half of the year. MediaTek’s first LTE devices will have stand-alone modems, but the company is sampling integrated chips that combine modems and application processors.

Broadcom has taken major strides in the LTE market after acquiring LTE-related assets from the affiliates of Renesas in September 2013. Broadcom’s M320 dual-core LTE System-on-a-Chip is soon likely to be used in Samsung phones. The chip supports LTE Cat 4, with speeds of up to 150 Mbps. It is backwards compatible to support any network except for CDMA and TD-SCDMA.

Another player gearing up to capture a large share of this market is China’s leading mobile baseband chip company Spreadtrum Communications. The company’s second-generation 28-nm process LTE solution (CAT 4) is likely to be released in the near future and will feature five-mode basebands (LTE-TDD, LTE-FDD, WCDMA, TD-SCDMA and EDGE).

Nvidia is another key player in this segment. The first device using Nvidia’s Tegra 4i chipset, which combines the company’s application processor with an LTE modem, is likely to be launched in the first half of 2014. Tegra 4i uses software-defined radio technology developed by Icera, allowing the chip to switch seamlessly between LTE and 3G radio frequencies, and be configured for new frequencies even after being sold to a customer.

The competition among chipset vendors will intensify as more carriers roll out LTE, thus driving the demand for LTE-supported handsets. The growing competition among chipset vendors is likely to impact smartphone prices. Industry analysts expect some of the chipset suppliers to reduce the prices of their products in the second quarter of 2014 when handset vendors are ready to launch production based on new models for the second half of 2014. India being a cost-conscious market, low-cost devices will be key to drive the mass adoption of 4G services.


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