NEW DELHI: Taiwanese chipmaker MediaTek expects demand for smartphones that support LTE fourth-generation technology to rise significantly in India in 2015-2016 on the back of mass rollouts of 4G services by Reliance Jio Infocomm and Bharti Airtel. The company expects 10% of its 40 million projected chipset shipments to be LTE-enabled.
“We have set ourselves up for LTE this year. Next financial year (starting April 2016) will be significantly big for us in the LTE segment,” Finbarr Moynihan, general manager, corporate sales-international, told ET.
Of its total chipset shipments, more than 10% will be to India, which is the company’s second largest market after China. Globally, the company is aiming to ship around 450 million chipsets with 150 million being LTE chipsets. Last year, it shipped 350 million chipsets, including 40 million LTE-enabled.
The $100 smartphone (Rs 6,400) category will drive the growth for 4G smartphones in India. The current range of 4G smartphones start just above $100.
At present, Bharti Airtel and Aircel offer 4G services in some areas. Mukesh Ambani-owned Reliance Jio, which has 4G airwaves countrywide, is set to launch low-priced, yet high-speed, data services on mobile phones that support LTE around December. Jio expects India to be flooded with 4G handsets costing less than Rs 4,000 by the year end.
Moynihan said chip prices will further come down due to evolution in the Chinese domestic market, which has seen almost 10% to more than 85% 4G smartphones coverage in the past one year, driving huge volume and reducing the price for LTE devices dramatically. Increasing competition among Mediatek, Qualcomm, Intel and others is also driving down the price of chips, and so of handsets.
Vendors are now building LTE smartphones with entry-level features, he said.
In order to drive the LTE ecosystem, MediaTek last year opened its second R&D center in Bengaluru and it plans to invest $200 million there. The unit is involved in the development of LTE chipsets and modem software. Besides, its Noida R&D unit is involved in global and domestic Internet of Things (IoT) and LTE field trials and testing.
In a year, the headcount in the Bengaluru unit has reached 200, which will go up to 500 in the coming years. “Major investment will go into these facilities. There’s a large talent pool in India which we will tap,” Moynihan said.
The company will also provide hardware and application support to device makers wanting to locally manufacture their products. The chipset maker is working with Micromax and Intex to provide modules for wearables such as smart bands and Android Wear-powered smartwatches.