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Jan. 15, 2009

Overall, the market for mobile base stations and their associated microchips is slowing down at a constant pace. Research firm In-Stat said in its latest wireless industry research today that, as a result, weaker sales are expected for base station vendors.

“Base station semiconductor revenue will continue to decline an average of more than 12 percent a year from now until 2012,” In-Stat said.

Some markets are nearing saturation while most major wireless carriers are already done upgrading networks for 3G connectivity.

Additionally, there’s the focus on making existing base stations perform better by using new kinds of remotely adjustable mobile antennas.

In-Stat analyst Allen Nogee said “the worsening global recession that has been with us since mid-October 2008 will also have a great negative impact.

Although most people aren’t likely to get rid of their mobile phones, they may replace them less often, and greatly reduce services they don’t find value in or that they simply cannot afford.”

Revenue from W-CDMA may still continue to grow, but overall base station microchips are in a steep declining market, Nogee found.

Interestingly, IMS Research says the Bluetooth chip market is actually on the rise (!) Average selling prices will fall about 40 percent through 2013 as volumes increase for low-end phones, analyst Chris Shreck said.

That’s actually good news for major hardware makers like Broadcom and CSR, as long-term sales of upcoming high-speed Bluetooth microchips will probably make up the difference.

However, it may be more work for smaller challengers to keep up, Shreck added.

"As a great mobile phone feature today, Bluetooth is surprisingly not ubiquitous, but it’s certainly headed in that direction," noted Shreck.

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Source: In-Stat Research.