Broadcom Emerging As Tier-1 Baseband Supplier

According to a new Strategy Analytics report, cellular baseband revenues are not yet significant for Broadcom, and thus, the company may have to continue its aggressive acquisition strategy in order to build a product range and customer base strong enough to compete with Qualcomm, Infineon and ST-Ericsson.

Broadcom is emerging as a strong baseband supplier with both EDGE and 3G design-wins at top handset vendors Nokia and Samsung. Strategy Analytics notes that Nokia and Samsung together command approximately 60 percent of the handset market, a share of which would certainly help Broadcom's ambitions to become a tier-1 baseband supplier. This, along with company's recent legal victory over Qualcomm, suggests that Broadcom is well-placed to increase its market share.

Sravan Kundojjala, Analyst commented "Strategy Analytics believes that Broadcom quickly needs to convert its aggressive mobile R&D spend into revenue and the company may need to go for further acquisition to build scale. Broadcom's competitors ST-Ericsson and Infineon both chose the acquisition route to build scale."

Stuart Robinson, Director of the company's Handset Component Technologies service added, "Strategy Analytics believes that Nokia wants Broadcom to survive and prosper as part of the handset giant's multi-sourcing strategy. Broadcom now has an opportunity to become a tier 1 baseband supplier and the ball is firmly in Broadcom's court to deliver on that opportunity."

Posted to the site on 19th May 2009