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Rumor: Grey Market Vendors Await MTK Smartphone Chips

Southern Metropolitan News, 7/11/11

The head of a handset integration firm in the Huaqiangbei area of Shenzhen said his company would not know whether it could produce smartphones until H2 2011, when Taiwanese fabless semiconductor company MediaTek (MTK) is expected to release low-cost smartphone and pseudo-smartphone chipsets. Handset vendors are also waiting to see how Chinese handset companies like OPPO, K-Touch, and Gionee will fare in promoting their smartphones. If they succeed, and domestic customers prove receptive to Chinese-made smartphones, then many smaller handset makers will be willing to make their own forays into MTK-based smartphones. If not, then small handset makers will likely keep making feature phones.

The source said that there are more than 1,000 "handset integrators" in the Huaqiangbei area, only 300 or so of whom are licensed. Although the remaining 700-odd are unlicensed, the source said, this figure is down to nearly half the number of unlicensed handset makers three or four years ago.

Editor's Note: Handset integration is the final stage in the mobile phone manufacturing chain, integrating handset body design, solution design, contract manufacturing, and sales and marketing. Pseudo-smartphone chipsets refers to solutions that allow manufacturers to produce feature phones that allow users to download and install their own apps, mimicking smartphone functionality.

Keywords: K-Touch handset smartphone wireless Gionee MediaTek Oppo handset production black market contract manufacturer

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