Taylor Hsu, Senior Manager, Product Planning Center, Compal Electronics; Henry Wang, Senior Manager, Acer Inc.; Chris Wei, Senior Manager, Market Intelligence Center, Taiwan; Kevin Sung, Marketing Director, Asia Wireless Terminal Business Unit, Texas Instruments Inc.; and Didier Dutronc, Group Vice President, Wavecom, and Managing Director, Wavecom Asia-Pacific Ltd, discussed the market and technology trends in the PC and mobile electronics industries in Asia. Excerpts:
How is the mobile computing sector performing in the Asia-Pacific region? Wei: The mobile device technology is maturing, especially in terms of reduced power consumption. The technology may now be used in smart phones or PDAs, so computing and communication technologies will converge for synergy in the near future. Hsu: Mobile computing devices provide functions that you can find in a notebook computer but are small enough to put into your pocket. I think this market will position itself as a second device for end-consumers, not the primary device which is either a notebook PC or a desktop PC. However, the short battery life of mobile computing devices is still a major problem hindering its market acceptance. Mobile computer vendors are working on reducing power consumption of the system parts, in addition to increasing battery capacity. The market growth for notebook computers is coming from desktop replacement. It needs to be further observed how soon mobile computing devices can replace notebook computers. Wang: We believe that as the wireless market matures, the demand for mobile computing will keep on growing.
Computer functions are increasingly being integrated into mobile phones, and vice versa. Do you think that the mobile phone and computer segments will converge in the future? Wang: Mobile phones have changed how people work and interact in a more convenient and efficient way. In terms of productivity or entertainment, I think that the PC is still irreplaceable and won’t lose its value in the market. Mobile phones will not become a substitute for PC. Hsu: There is a lot of convergence going on in the technology industry today. Mobile phones will adopt more and more computing functions, while computers will accommodate more communication features. Consumer electronics manufacturers are also trying to add computing and communication functions into their products. It seems that everybody is moving toward convergence of the 3C’s – computer, communication, and consumer. These converged products from different vendors may look similar, but have different specialties. I think notebook vendors have the best chance to dominate the market, because it is easy for computer makers to add more functions into their systems. They need to just buy a module and configure it into the computer system. On the other hand, for vendors who are in the communication and consumer sectors, it is not easy to add a computer system into their products.
What can you say about the mobile electronics trends in Asia? Dutronc: Mobile electronics is an exciting and competitive trend in Asia. The extreme competition is pushing all the players to be at the leading edge of technology vs. cost. Sung: Asia is a very special market, providing demand for both low-cost and high-end multimedia handsets. According to the GSA, China and India are the two largest mobile markets for GSM, and in average there are 11.2 million new users each month in these two countries alone. With the increasing number of mobile users, entry level handsets can no longer satisfy consumers’ needs. Low-cost handsets used to be the trend for the mobile phone industry in emerging markets in Asia. However, the middle class of these emerging economies also want the same value-added features as those with high-end models. Feature-rich solutions will be the trend for the low-cost mobile market. Meanwhile, high-end handsets with advanced multimedia functions will continue to be an important segment.
How do you see the multiplicity of standards in the mobile communications and services segments affecting the growth of the mobile electronics industry? Sung: According to August 2007 GSA report, the market share for GSM/ WCDMA at the end of Q2 07 was 85.4%. GSM/GPRS remains the major standard in this market. WCDMA has a 95% yearly growth rate, and growing 6 million connections per month. Meanwhile, China’s TD-SCDMA standard has also grown dramatically. In order to meet the market demands for different standards, it is expected that there will be more manufacturers to launch dual-mode handsets. Dutronc: The multiplicity of standards will not be a major showstopper as the consumers are not aware of or concerned about them. The key point is the pervasion of wireless technology into the consumers. After the voice segment, all parties now are looking for data deployment. In that field, machine-to-machine or M2M communications will play a key role in the future. The awareness of M2M is getting higher and this seems to be the next “hot” market segment. Many network carriers are trying to create the next “wave” by selling data on top of the existing saturated voice business.
How do you perceive Asia as a global mobile design and manufacturing center? Sung: TI sees great potential in Asia as a global mobile electronics design and manufacturing center because Asia has the complete production chain. Moreover, there is an increasing number of design and engineering talents in Asia. In China, we have joint design centers for broadband access equipment and wireless development. In India, TI has an R&D presence in Bangalore, which provides a base for selling to the growing number of customers designing and manufacturing in India. We also have a research center in the Philippines.
