Intel allies with Chinese white-box handset makers

Intel allies with Chinese white-box handset makers

Staff Reporter

2013-10-18

US chipmaker Intel has upped its stake in the Chinese “white-box” or unbranded handset sector, establishing support teams in China to assist related companies to design, define and market their products, reports the technology news website of Chinese web portal Sina. Although the chipmaker failed to grab a leading position in the rapidly-growing portable handset market, it has pledged to catch up by working with the firms in Shenzhen in southern China’s Guangdong province.White-box handset manufacturers are playing an important role in the development of the global handset market. According to market research firm eMedia Asia, the companies delivered over 50 million shipments last year and the figure has not showed any sign of slowing, reaching 80-100 million over the first half of this year and 25 million alone in the last quarter.

However, their margins have shrunk significantly due to rapid growth and lack of product differentiation in recent years, with some of their products’ margins down to only a few yuan. Intel will now provide solutions to these Chinese companies which are to include systems on a chip, circuit board and memory. The US multinational semiconductor maker has also established a professional team of 100 plus people in China to offer assistance to the local white-box handset makers, and it has earned the trust of 14 white-box firms such as Ramos and Teclast Electronics.

Stephanie Hallford, Intel’s director of Asia-Pacific Mobility Brand Marketing based in Beijing, was impressed by these Chinese producers’ speed and flexibility. In the past, the development of an Intel’s new products would take at least eight to twelve months but Chinese companies have reduced it to six months or even two to three months, she said.

White-box maker Ramos, meanwhile, has exhibited its strength in flexibility during the joint development of a tablet with Intel. After it decided to use another type of screen, it managed to adapt and launch the tablet into the market in no time at all, the report said.

Some analysts have claimed that white-box companies only focus on short-term profits gained from low-price models, however Intel thinks otherwise and remains optimistic. Chinese PC maker Lenovo was a lesser-known company which only sold ten thousand computers annually back in 1994, it has grown into the world’s second largest personal computer vendor by sales last year, the report said.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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