Spreadtrum Counts on Taiwan's Chipmakers to Win 3G Battle In China

Taipei, Oct. 3, 2011 (CENS)--Spreadtrum Communications Inc. of mainland China has contracted Taiwan Semiconductor Manufacturing Co. (TSMC) and Advanced Semiconductor Engineering Inc. (ASE) to make its baseband chips designed on 40nm process rule amid white-hot competition among the mainland's 3G chip vendors.

Spreadtrum has commanded a 56% share of the mainland market for the wireless chips specifically designed for mobile phones that are built on the TD-SCDMA (time-division synchronous code division multiple access) 3G format, which is spearheaded by China Mobile Co., Ltd.

The chip vendor recently completed a 40nm chip design, which it claimed consumes only two thirds of the electrical power that a 65nm chip does and brings down the cost of TD-SCDMA phone close to that of the 2.7G EDGE handset.

Spreadtrum has designated TSMC to make the chips and ASE to package the chips for it in conjunction with China Mobile's plan to promote TD-SCDMA handsets during the 2012 Chinese New Year holidays, which will begin on Jan. 23.

The vendor will begin pilot production of its chips for the 4G TD-LTE (time division long term evolution) phones at the end of this year also at TSMC and ASE.

Industry executives expect Spreadtrum to retain the championship in the mainland's market for the TD-based chips given that it has shied away competition against Taiwan's MedaTek Inc. for a slice on WCDMA (wideband code division multiple access) market, where competition is keener among chip vendors than on TD-SCDMA market. In addition to MediaTek, competitors in the mainland's WCDMA market include MStar Semiconductor Inc., Qualcomm Inc. and ST-Ericsson Inc.

The mainland now has around 100 million subscribers to 3G telecommunications service, which is mostly provided by China Telecom on CDMA2000 network, China Unicom on WCDMA network and China Mobile on TD-SCDMA network.