TAIPEI - Shipments of telecommunications equipment and related products by Taiwanese suppliers are expected to grow two-fold next year, said institutional investors yesterday, citing the recently concluded operating license auction for the forthcoming fourth-generation (4G) network and increased cross-strait collaborations in the fledgling technology as factors.
According to these investors, telecoms carriers on both sides of the strait are expected to generate enormous demand in equipment required to set up forthcoming 4G networks, with shipments of customer-premises equipment such as modems and set-top boxes anticipated to grow two-fold to reach 10 million units, representing NT$20 billion (S$84.4 million) in revenue across the sector, said institutional investors.
Institutional investors listed makers of mobile broadband dongles, routers, and other related connectivity products including Gemtek, Arcadyan, Unizyx, Sercomm Co. and MTI among companies poised to capitalise on the expected surge in demand. Among these companies, institutional investors stated that Arcadyan, Gemtek, and a subsidiary of Unizyx have been confirmed as major suppliers to Huawei, a major mainland telecoms conglomerate, with each expected to ship millions of units.
Incidentally, a similar boom was predicted last year by investors on the basis of concurrent efforts to migrate toward next-generation network technology in the US, Japan and China markets; however, actual demand was curtailed by global economic gloom, with the lack of large-scale procurements resulting in less-than-expected shipping volumes by suppliers.
Market analysts expect conditions to improve this year for Taiwanese suppliers, with telecoms carriers on both sides of the strait anticipated to make considerable orders as soon as the end of November, with procurements poised to peak next year.
According to institutional investors, the boom in procurements is expected to take place in three phases, beginning with small-cell radio access nodes and Wi-Fi hotspot equipment, followed by cloud computing platforms and other software services, with the final surge in demand represented by chip design, electronic commerce and gaming.