Taiwan handset makers betting on smartphones

With only a small chance of seeing major expansion in the worldwide market share, Taiwan’s handset makers are looking upon smartphones to be their next major profit driver, according to industry sources.
According to DigiTimes Research, Taiwan’s handset shipments for 2006 will total about 146 million units, accounting for 15% of worldwide shipments, up from 10% in 2005.
However, the global handset market is quickly consolidating, with major vendors, such as Nokia, Samsung Electronics, and LG Electronics, having a high proportion of in-house production. The slow growth for outsourcing will be an obstacle to Taiwan makers’ shipment growth, the sources noted.
Although Taiwan’s share of worldwide handset shipments, according to DigiTimes Research, may increase to 15-21%, the makers will have a mountain to climb to achieve the 40% goal set for 2008 by the Industrial Development Bureau of Taiwan’s Ministry of Economic Affairs (MOEA).
Competition has been growing strong from EMS suppliers, and increases in orders from major vendors can hardly be expected, the sources said.
But the makers are changing their strategy, developing smartphones as their next profit driver, the sources remarked.

Taiwan handset makers betting on smartphones