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Components | January 25, 2012

Qualcomm holds 30% of mobile device semi market

M&A activity shakes up mobile device semiconductor market, but Qualcomm still holds 30% of the over USD 25 billion market.
2011 marked a big year for mergers and acquisitions (M&A) in the mobile device semiconductor market. From Intel’s acquisition of Infineon Technologies AG Wireless Solutions to NVIDIA’s purchase of Icera, the mobile device semiconductor market has seen a lot of moving and shaking. Despite all the M&A activity, however, the market is still projected to remain relatively flat, with only 5.6% CAGR from 2010 to 2016, pushing the market from $25 billion in 2010 to $35 billion in 2016.

Intel’s purchase of Infineon’s wireless semiconductor business was a smart move for the company, as Intel previously did not hold any significant share in the handset market, despite attempts to break into it with its processors. Its purchase of Infineon’s wireless business, while giving Intel an instant foothold in the market, also appears to be bearing fruit elsewhere. Intel’s newfound market share in other areas of the handset IC market assisted in Intel’s recent announcement that Motorola and Lenovo will release smartphones based on Intel processors in 2012.

“Most of the major suppliers are spending considerable resources on improving their platform solution capabilities,” says Peter Cooney, practice director, semiconductors. “Through acquisitions and internal product developments, suppliers such as ST-Ericsson, Broadcom, NVIDIA, Marvell, and Renesas are transitioning to a platform supplier model. Although Qualcomm currently leads the way, many other suppliers are increasing their capabilities and the competition between suppliers will increase significantly over the coming years.”

Although Qualcomm currently rests easy as the most successful and largest supplier of mobile device semiconductors (holding almost 30% of the total market share), the company has partaken in the M&A trend as well, acquiring Atheros Communications to form the subsidiary Qualcomm Atheros, strengthening its wireless connectivity portfolio.

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