Electronics Production | April 16, 2007

46.9% of the world's mobile<br>phone production in China

The global mobile phone shipment was approximately 970 million units with a production value of about USD 79 billion in 2006. The market share of the top 9 manufacturers reached 90.72% and that of the top 5 manufacturers was 83.88%, and Nokia ranked first in terms of sales volume, reaching 347.5 million units.
As for the mobile phone platform, new comers will face big competitive pressure. It is quite difficult for survival without enough shipment, while the concentration degree is rather high in mobile phone industry, and plus tier-one manufacturers and platform suppliers are working more and more closely, so there has a high threshold for new comers.

However, MediaTek Inc., a dark horse in mobile phone platform industry, is very fortunate for it has caught hold of such two tier-one clients as Samsung and LG, and then ascends to be one of the international first-class mobile phone platform suppliers. Unfortunately, it is just Samsung and LG selecting MediaTek as the partner that causes the decline of sales.

Mobile phone RF field basically maintains its established pattern. SKYWORKS gets very depressed in mobile phone platform field and then gives up baseband field, and now specializes in RF. As for the power amplifier for mobile phone, RFMD still stands out and controls the market alone. In addition, in the transceiver field, Qualcomm still takes the lead while NXP turns better, and STMicroelectronics holds its firm status under the big client of Nokia.

It shows no good sighs for built-in memory of mobile phone, especially in NOR flash field. The leading company Spansion lost 90 million US dollars in the year of 2006, less than USD 285 million in 2005 but it seems no reasons to be optimistic. Spansion plans to sell factories to get through the hardship. Also, Intel had a huge loss of USD 552 million. However, the factories that specialize in NAND flash have made a considerable profit, especially Samsung and Toshiba. NOR flash manufacturers have to seek the other ways for survival in the future; otherwise, they will be purchased either by private funds or by other companies.

Mobile phone display screen is falling into the trouble of successive profit decline. TFT-LCD display screen for mobile phone has dived nearly 100% since the second half of 2005 as batch of large-size TFT-LCD manufacturers began to produce small-size display screen. Such a transfer causes a sharp rise in supply and also makes TFT-LCD become the mainstream. However, as the resolution of display screen for mobile phone gets further improved, QVGA will be the mainstream. However, it is very difficult for those large-size TFT-LCD manufacturers who began to produce small-size ones to go through the technical access to QAGA in a short time, so the price of mobile phone display screen is expected to get steady and even show a re-rise.

Mobile phone PCB market is still controlled by Taiwan manufacturers and their market share has already exceeded 50% and will be over 60% by 2007. As far as the technology is concerned, there is no obvious change and high-grade HDI still takes the mainstream. Panasonic and IBIDEN have not introduced their new technologies in a wide range yet due to the high cost. In the mobile phone PCB field, rigid-flex PCB is the hotspot. Most of mobile phone PCB manufacturers mainly engage in the RPC production while FPC manufactures are relatively independent. Whereas, the application amount of FPC is much lower, so most of PCB manufacturers prefer to make the PCB business contracted. As PCB manufacturers are quite sensitive to oil price, the continued decrease in oil price will help them to make more considerable profits.

A metallization wave sweeps over mobile phone configuration parts & shell guided by V3, which means, on the one hand, the metallization in a real way for more and more aluminium and magnesium alloys handsets have appeared; and on the other hand, the metallization of plastic shell, i.e. adopting NVCM process. Compared to plastic configuration parts & shell, metal one has a log of advantages though, it has not been promoted because of the high cost. But now, the emergence of V3 has broken the bottleneck in cost and decreased the cost. Ultra-thin mobile phone is the mainstream at present and will last a long time, and ultra-thin configuration is just the advantage what the metal material has.

There are no great changes in camera module of mobile phone. The mainstream configuration of mobile phone camera still comes to between 1.3 mega-pixels and 2 mega-pixels, but 2 mega-pixels camera is applied to high-end mobile phone and is expected to be the mainstream by 2007.

As for the mobile phone manufacturing, China is the world largest mobile phone manufacturing base and around 46.9% of world's mobile phones are made in China in 2006. Around 103 million mobile phones were sold in China's domestic market and 252.2 million were exported. Shenzhen, Tianjin, Beijing and Suzhou have become the important bases for mobile phone manufacturing, and have formed a complete mobile phone industry supply chain, especially Shenzhen. The mobile phone output is getting higher and higher in India. Basically, the assembly process for mobile phone is done there in India, but as mobile phone giants enter into Indian market successively, some matched manufacturers are planning to go there. However, as for the infrastructure and human resource, India is far enough to compare with China, so few matched manufacturers are willing to go there. As a result, India can pose no threats on China in a short term.
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