Abstract

In the period 2008-2012 accumulated worldwide investment in WiMAX network deployment is expected to exceed US$22.5 billion. Currently there are already more than 330 telecoms engaged in WiMAX technology testing or commercial operations. This means that more than half of the world's telecom operators are involved in WiMAX. Taiwanese companies have built upon their past contributions to the ICT industry and are playing an important role in the WiMAX industry. Taiwanese makers have coordinated their efforts in terminal access device R&D with international telecom equipment vendors, and have completed interoperability between these devices and base stations. They are thus able to provide global telecom operators with competitive CPE products. Furthermore, they are also aggressively engaged in the R&D of small-sized base stations, hoping to complement international telecom equipment vendors. The establishment of two WFDCLs (WiMAX Forum Designated Certification Labs) in Taiwan and the launch of the six Taiwanese WiMAX operators' networks in 2009 will accelerate product certification and commercialization for Taiwanese companies, so that their products will be adopted by telecom operators worldwide. Taiwan has come to play an important strategic role in the global WiMAX industry.

Taiwanese WiMAX Equipment Makers' Shipment Statistics

Stimulated by the Executive Yuan's M-Taiwan program, which is carried out by the IDB (Industrial Development Bureau), and the WiMAX Acceleration Project, carried out by the DoIT (Department of Industrial Technology), Taiwanese companies have made aggressive investments in WiMAX technology and product R&D. As a result, Taiwanese companies have already gained development advantages in the WiMAX industry supply chain. In 2008, Taiwanese WiMAX CPE shipment volume reached 914,000 units, accounting for approximately 30% of total global shipments. Shipment value amounted to US$146.5 million. In 2009, Taiwanese WiMAX CPE shipment volume is forecasted to top 1.4 million units, growing over 40% in comparison with 2008.

Figure 1: Taiwanese WiMAX CPE Shipment Volume, 1Q 2006 – 4Q 2009

Source: M-Taiwan Project, compiled by MIC, March 2009

Current Product Development of Taiwanese WiMAX Equipment Makers

Looking at the WiMAX CPE shipments by technology, the demand for 802.16d products remained relatively stable throughout 2008, with the full-year shipment volume accounting for approximately 39% in the overall shipments. Meanwhile, the full-year shipment volume of 802.16e products represented a share of about 61%.

 In application products, product differentiation will gradually increase. Residential CPE, besides data transmission functions, in the future will also actively support VoIP (Voice over Internet Protocol). Regarding wireless modules, besides providing mini card/half mini card, many different interfaces will be supported, making it possible to use them in handheld or consumer electronics products. It can therefore be expected that the scope of products supporting WiMAX will become broader in the future, and product mobility will increase significantly.

 As currently the main WiMAX CPE shipment destinations are mostly remote regions with sparse populations, the WiMAX carriers, after setting up service centers, will have to spend at least US$100 per case from dealing with the complaint call to the subsequent problem solving. In order to reduce operating costs, WiMAX carriers require that CPE vendors provide products with remote control, data management and update capabilities. Furthermore, the remote control technology is required to comply with the OMA (Open Mobile Alliance) DM (Device Management) standard. Taiwanese equipment makers have been aggressively seeking collaboration with partners equipped with said technology so as to satisfy the carriers' requirements.

As for WiMAX notebook PCs, starting in 2008 Asus, Acer, and MSI have made considerable investments in related R&D and showcased their respective products. Asus also demonstrated a WiMAX-enabled Eee PC model at year-end 2008. Meanwhile, companies including HTC, Asus, Benq, Inventec, Tecom, and Wistron NeWeb have engaged in the development of WiMAX mobile phones. HTC has begun shipments of a dual-mode GSM/WiMAX phone - HTC MAX 4G - to Russian WiMAX carrier Scartel. In the future, Taiwanese WiMAX products are expected to become more diverse and migrate from the nomadic scenario to full mobility, providing total solutions to fulfill the carriers' demand.

In the WiMAX CPE chipset segment, currently the main suppliers are still international companies such as Intel, Sequans, and Beceem. Taiwanese chipset suppliers have made aggressive moves in this segment, too. Companies including MediaTek and MDV have been engaged in the R&D of WiMAX chipsets. By year-end 2008 Taiwanese chipset suppliers had begun sampling their chipsets to Taiwanese equipment makers.

 Table 1: Taiwanese Makers' WiMAX Equipment Development

Source: M-Taiwan Project, compiled by MIC, March 2009

Taiwanese Equipment Makers' Shipment Outlook

The countries having seen aggressive WiMAX network deployment in 2008 included Russia, India, Japan, and Malaysia. Further progress of network deployment in 2009 in these countries is projected to play a crucial role in Taiwanese WiMAX CPE makers' shipment performance. There had already been a limited amount of shipments from the Taiwanese makers to major Russian WiMAX carrier Scartel towards the end of 2008. Meanwhile in India, the prospect of WiMAX market in India in 2009 remains muddled due to a number of reasons. To begin with, the WiMAX tenders are carried out separately in different telecom circles and related procedures are complicated, making it a burdensome task for interested parties. Moreover, the values of WiMAX tenders in India are relatively low in general, leaving limited room for profits. Companies seeking to tap the Indian market will therefore suffer from considerable cost pressures. In addition, the schedule spectrum auction has been postponed indefinitely. Despite these negative factors, WiMAX network deployment has been seeing continuous progress in India. Therefore, the Indian market still poses a lucrative business opportunity for the Taiwanese equipment makers in 2009.

In Malaysia, local WiMAX carrier Packet One Networks, to which some Taiwanese makers had began shipments in 2008, was slated to expand its services in March 2009. Meanwhile in Japan, UQ Communications began offering trial services in February 2009, attracting 20,000 candidates to sign up for the recruitment of 5,000 trial users. UQ Communications has been in talk with Taiwanese makers over WiMAX CPE procurement, too.

As WiMAX CPE demand will not see noticeable growth until the second quarter of 2009 when network deployment begins to take off in various countries, it is expected that the Taiwanese WiMAX CPE makers' shipments will benefit from the demand surge starting in the second half of the year. It is forecasted that, in comparison with 2008, Taiwanese WiMAX CPE shipment volume will see further growth in full-year 2009.