Tag: China

TDK is confident of Apple deal

lucas-cranach-the-elder-eve-offering-the-apple-to-adam-in-the-garden-of-eden-c-1520-25-oil-on-wood-detail-of-407328Japanese smartphone bits maker TDK has hinted that it will win some major orders from Apple next year.

Apple likes to keep the names of its manufacturers secret perhaps to keep the illusion that everything was built by Apple.

Company chief executive Takehiro Kamigama said: “Expectations for the next year are high” which seems to suggest that the iPhone will carry more of its high-frequency filters per handset.

There is little new here. Apple is widely believed to be a major client of TDK, although the company has never publicly named it.

TDK has revamped itself into a key smartphone parts supplier, with main products including rechargeable batteries, high-frequency filters that sort out radio signals, and tiny parts called capacitors that control the flow of electricity.

TDK forecasts sales of smartphone-related components to grow to $2.44 billion in the next fiscal year, Kamigama said.

He dismissed concerns that smartphone shipments in China, the world’s largest market, may continue to slow down. “We are confident on increasing our share in rechargeable batteries, because winners in the Chinese handset market are saying they want our batteries,” he said.

Kamigama is betting TDK’s magnetic sensors, which measure the angle in the electric power steering systems and other devices in cars, will draw strong demand.

“We are currently in talks with 40 major automakers and parts suppliers,” he said.

US and China sign cybercrime pact

article-2518111-19D7434D00000578-74_634x423The United States and China have come up with guidelines for requesting assistance on cybercrime or other malicious cyber activities.

According to a statement from the US Justice Department, the agreement was reached in talks in Washington this week among officials including US Attorney General Loretta Lynch, US Department of Homeland Security Secretary Jeh Johnson and Chinese Public Security Minister Guo Shengkun.

China and the US will conduct “tabletop exercises” in the spring with a number of scenarios designed to improve understanding of the expectations for response and cooperation.

China’s Ministry of Public security said the agreement would have a “major impact” on the implementation of internet security measures, adding that the two sides resolved to maintain frank discussion on the issue.

The news was marred by the hacking of sensitive personnel records on people holding US security clearances at the Office of Personnel Management (OPM) last year. The Chinese said that the hacking was criminal, not state-sponsored. The US is not so certain.

The Washington Post said that  multiple people had been arrested in that case, which compromised data on more than 22 million federal workers.

US officials have said they are unaware of any evidence demonstrating that the hacked OPM data had been used for any criminal purposes.

Chip company mergers and acquisitions reach $80 billion

intel_ireland_semiconductor_chip_fab_300mm_waferInterest in writing cheques for chipmakers through mergers and acquisitions (M&As) is expected to pick up.

Chipmakers have already announced over $80 billion worth of M&As in 2015.

Chipmakers are acquiring peers to expand capacity and capabilities ahead of an explosion in demand for all kinds of semiconductors necessitated by the Internet of Things.

Hidetoshi Shibata, chief financial officer of Japan’s Renesas, said that the days of chip companies growing through their own development are over and the only way to get bigger is by buying a rival.

The biggest buyers are the Chinese whose aggressive cheque book is pushing the value of merger targets beyond rivals’ reach. The leader is Tsinghua Unigroup which has spent $10 billion on M&As over the past two years and plans for almost $50 billion more over the next five.

Many Chinese deals are by privately held parties, such as Tsinghua, which this month earmarked almost $13 billion for a memory chip factory. In April, a group of Chinese investors agreed to buy US smartphone camera chip maker OmniVision Technologies for about $1.9 billion in cash.

More consolidation among companies making chips for memory and power management is expected.

Analysts think most of the Chinese buyouts are part of the plans of an emerging superpower to become self-sufficient, by controlling all aspects of a business and developing products to rival established players.

LED lighting market takes off

LA lighting systemLED lighting will generate revenues of $25.7 billion this year but that’s only the start.

Market research firm Trendforce said that it will be worth $30.5 billion and while it accounts for 31 percent of the lighting market in 2015, that share will rise to 36 percent next year.

Joanne Wu, a research manager at Trendforce, said sharp price drops have hit the market for replacement LED light bulbs. So the companies are targeting large enterprises and commercial customers for growth.

Demand in the USA is particularly strong, said Wu, particularly in lighting for industry, horticulture and the maritime market.

New applications for LED lights include so called smart lighting and light communication.

India, she said, plans to buy 200 million LED light bulbs by the end of 2016.

Photovoltaic module production to go through the roof

Solar farm in Arizona - Wikimedia CommonsProduction of solar photovoltaic (PV) modules will soar during the first half of 2016.

That, said IHS Technology, is because of installation deadlines, the end of solar tax credits and demand from the two biggest markets for PV, the USA and China.

IHS said that PV installs will increase by 33 percent this year, reaching 58.7 gigawatts (GW).

Growth will slow to 12 percent in 2016.

But there’s no good news on pricing in the US market. Trade disputes mean that prices won’t fall there in the first half of the year.

The demand from China and the USA means there will be shortages in the first quarter of 2016.

Average selling prices will fall in the second half of next year, IHS predicts.

Qualcomm’s bottom line slumped thanks to China

qualcomQualcomm forecast first quarter profit below analysts’ expectations as the chipmaker struggles against fierce competition from Chinese and Taiwanese rivals.

Qualcomm reported its fiscal fourth-quarter earnings fell to $1.1 billion from $1.9 billion a year ago.

Revenue fell 18 per cent to $5.5 billion. Analysts had projected $5.21 billion. This was all better than analysts expected, thanks mostly to reduced costs, but the problem appears to be in the future.

The company is facing huge delays in closing Chinese licensing agreements with its two main Chinese customers.

President Derek Aberle said some Chinese customers were “improperly withholding” royalties on Qualcomm’s patents by changing the way they report sales. The company had half of its fiscal 2014 revenue from Chinese customers, so this was a big deal.

Qualcomm is expected to announce job cuts and other cost cutting steps in the face of stiff competition. Things are expected to get worse as chipmakers consolidate.

On the bright side demand for the new version of its flagship Snapdragon mobile chips was stronger than it had expected in the fourth quarter.

The company was hurt earlier this year by Samsung Electronics decision to use an internally developed processor, instead of the Snapdragon chips, in its Galaxy S6 smartphones.

Samsung had not ruled out using Qualcomm’s chips in the future and media reported last month that the South Korean company’s Galaxy S7 phones for the US and China markets were expected to use Snapdragon 820 chips.

The net income attributable to the company fell 44 percent to $1.06 billion.

Tsinghua eyes up MediaTek

ChinaThe Chinese state backed consortium Tsinghua Unigroup wants to take over successful chip firm Mediatek.

China has a long range plan to grow its semiconductor industry and according to a report in Digitimes, Tsinghua’s chairman Zhao Weiguo said that if Taiwan lifts its ban on Chinese firm, there could well be a merger of the companies.

MediaTek said that it would be happy to talk with Tsinghua in a merger provided that Taiwanese government restrictions were lifted.

Although Taiwan does not allow Chinese companies to take shares in companies on the island, there’s a great deal of self interest in both countries cooperating.

For example, many Taiwanese semiconductor firms have factories in mainland China.

Apple posts results lower than expectations

apple-dalek-2Apple spinners were doing their best to paint a rosy future for its operations after turning in results which were lower than many analysts expected.

It is worthwhile pointing out that analysts have been predicting trouble ahead for Apple as its days of mega-growth appear to be over so they had low expectations.

On paper the figures looked great, but China sales dipped from the fiscal third quarter, when Apple notched $13.2 billion in revenue there.

The decline is important as many analysts believe China is poised to replace the United States as Apple’s biggest market – only this suggests that it is losing its grip.

Apple, the world’s largest company by market value, said it sold about 48.05 million iPhones worldwide in its fiscal fourth quarter ended 26 September, slightly below analysts’ average forecast of 48.72 million, according to a poll by Fortune magazine.

For the current quarter, which will include a full three months of sales of the new iPhone 6s and 6s Plus models, Apple forecast revenue between $75.5 billion and $77.5 billion. The company’s generally conservative forecast was in line with what Wall Street thought.

Morningstar analyst Brian Colello said the forecast was slightly below expectations but investors were pricing in a worse outcome.

Investors and analysts are more interested in what happens in the Christmas quarter. There is always a spike in sales when Apple fanboys automatically replace their gear. The Christmas rush is a time when Apple should make a lot more money.

Shares in Apple raised when investors believed that things were not as bad as they thought they were for the fruity cargo cult. Then they fell again when they realised they were still just as bad. It could have been worse. Some analysists were predicting 20 percent falls in shares.

Indian cloud service market worth close to $1 billion

cloudsPublic cloud services revenues in the sub-continent are set to generate $731 million by the end of this year, according to a report from market research outfit Gartner.

That’s an increase of $176 million from 2014 revenue, and the growth is being fuelled by sectors including infrastructure as a service (IaaS), cloud management and security services and software as a service (SaaS).

Gartner believes that by 2019 revenues from India will total $1.9 billion.

Sid Nag, a research director at the firm, said that the rapid growth of IaaS and SaaS shows that Indian enterprises are moving away from creating their own on premises infrastructure and shifting from the traditional software licensing model.

Gartner thinks that emerging markets including China and India will show real GDP growth from now through to 2017. But Brazil, Russia and Turkey will be exceptions because of currency fluctuations.

China leaps ahead on internet of things

ChinaA market research company has predicted that services revenues for the internet of things (IoT) in China will grow more than five times over the next five years.

ABI Research estimates service revenues will grow to more than $41 billion by 2020 – and China is the fastest growing of any country.

Dan Shey, VP at ABI, said that the smart metre segment is the major factor in the growth of China’s IoT numbers.

He said: “It leads all other segments in both connections and revenues. In fact, by 2020, smart metre connections will exceed the next highest market segments in total connections by nearly 10 to one.”

Shey said other major segments in the Chinese market include home security, automation, telematics, video surveillance, home appliances, aftermarket telematics and home monitoring.

The last will be important for China because there will be close to 340 million people aged 55 and older by 2020.

Data analytics will underline the most IoT revenues in the country because of the volume of smart metre connections, Shey said.