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Top 10 cell-phone manufacturers face challenging 2010

Leading contract manufacturers of mobile phones are in for a tough 2010 following a year that upended their longstanding business models and dealt them unprecedented losses, according to a new report from iSuppli Corp. Cell phone shipments for the Top 10

Original Development Manufacturers (ODM) and Electronic Manufacturing Services (EMS) providers are expected to rise by 3.4 percent to 204.2 million units in 2010, up from 197.5 million in 2009, said Jeffrey Wu, senior analyst for EMS & ODM at iSuppli. However, viewed from the perspective of an industry accustomed to double-digit growth, the slight increase is no cause for celebration. “The relatively flat growth anticipated in

2010 by the top contract manufacturers for wireless handsets is unimpressive when juxtaposed against the steep 30 percent plunge recorded by the group last year,” Wu said. At that time shipment levels fell from

280.9 million units in 2008, according to iSuppli. Demonstrating the difficulties for wireless handset contract manufacturers, shipments effectively halved in 2009 for some major players. Foxconn and Flextronics saw sales fall by 51% and 46% respectively while Elcoteq suffered a 62% decline.

The persisting challenges for the wireless

handset contract manufacturers represent a carryover of the upheavals in 2009, when a fall in the global wireless handset market forced key strategic shifts throughout the industry supply chain, Wu said. Responding to reduced demand, many

mobile handset firms adjusted their overall manufacturing and outsourcing strategies, in the process impacting ODMs and EMS providers alike. As such, prospects remain gloomy in 2010 for the group, Wu noted. Among OEMs using the services of the

contract manufacturers - outsourcing strategies are being adjusted in the face of the recession, and OEMs remain cautious about reengaging contract manufacturers in case the market does not recover as quickly as expected. Nonetheless, the overall wireless handset

market will bounce back this year, not only growing 12.8 percent to 1.5 billion units but also expanding at a Compound Annual Growth Rate of 6.8 percent from 2009 to 2014 - suggesting that recovery could be around the corner even for the Top 10. One example of the severe blow absorbed

by contract manufacturers is exemplified in the 2009 decision by Nokia Corp. to bring in- house previously outsourced orders. iSuppli

World’s smallest 32-bit ARM microcontroller

NXP Semiconductors has announced sampling of the world’s smallest general- market 32-bit microcontroller, the LPC1102, based on the Cortex-M0 processor. Covering a PCB area of just 5mm2 it is being targeted at very high volume applications requiring an ultra- miniature board footprint. As the newest member of the LPC1100

microcontroller family, the addition of the LPC1102 has been designed to offer low power, high performance and increased value, while adding the new dimension of miniaturisation. The LPC1102, with 32KB of Flash and 8KB of RAM on-chip, is available in Wafer Level Chip Scale Packaging (WL-CSP) with dimensions of 2.17 mm2 x 2.32 mm2, thickness of 0.6 mm, and pitch of 0.5 mm. “More and more of our customers are

limited by PCB space as they design products that are racing toward continual miniaturization, while also being expected to deliver more features, performance, as well as longer battery life,” said Geoff Lees, vice president and general manager, microcontroller product line, NXP

Semiconductors. “The LPC1102 with its 2 x 2 mm footprint is the solution.” “The very rapid roll-out and ongoing

innovation by NXP is remarkable and demonstrates the strength and versatility of the ARM Cortex-M0 processor,” said Richard York, director of product marketing, Processor Division, ARM. “Clearly NXP is reaping the benefits as shown by its increasing product portfolio of innovative and successful new ARM processor-based products.” Key product features include a 4-

channel 10-bit ADC, one UART, one SPI, two 32-bit and two 16-bit timers, and one 24-bit system timer. SWD debugging and programming with four breakpoints and two watchpoints are also included. A total of eleven I/O functions also double as general purpose input and output GPIO for maximum flexibility. Offering very low power consumption with active mode current as low as 130uA/MHz, the LPC1102 features an internal IRC oscillator, accurate to ±1 percent over the industrial temperature and voltage range. It can also be clocked with an external source.

estimates that Nokia’s overhaul of its old business model translated into revenue losses among contract manufacturers of up to $5 billion. Sharing similar concerns about internal capacity utilisation, other OEMs contemplating a ramp-up in contract manufacturing services then either reduced the size of their outsourcing programs or halted outsourcing considerations altogether. In addition to the pullback from these

companies, the market-share losses of Motorola Inc. and Sony Ericsson - two major Tier 1 OEMs that relied on contract manufacturers heavily - rippled through the chain, impacting the manufacturing partners of the two giants down the line. Wu said that while expanding into

manufacturing for the smart-phone segment allowed big-name contract manufacturers to obtain new orders from Tier 2 OEMs, those gains could not offset the larger losses that slipped away from the pullback of bigger customers such as Nokia and Sony Ericsson. “Ultimately, it is only when robust

growth is attained in the wireless handset market and confidence restored among firms that contract manufacturers can expect to revitalize their pipeline,” Wu said.

RS Components integrates EDP with ARM mbed programme

RS Components has signed a partnership with ARM to strengthen its Embedded Development Platform (EDP) product line by incorporating microprocessors featured in ARM’s new mbed programme. The enhancement sees the introduction of an mbed module that provides a fast and simple prototype and test route for new designs. RS EDP enables the rapid prototyping and proof-of-concept of embedded systems. It comprises reusable, reconfigurable Personality and Application Modules, developed in-house to provide a variety of processing and I/O functions. Following the partnership with ARM, RS will offer an mbed module for EDP allowing engineers to move, build and test their mbed designs quickly and easily in a hardware environment. RS is planning to introduce further new modules for EDP and will use the platform as a key element in a major initiative to partner with universities and offer them cost-effective and powerful teaching aids. “EDP offers designers a fast way to

develop electronic products,” said Mark Cundle, Technical Marketing Manager, RS

Components. “Its flexibility and configurability offers an almost unlimited palette of possibilities for engineers to quickly develop very sophisticated concepts.” One of the major strengths of EDP is that

it allows engineers to experiment with processors from competitive vendors on a common platform. This means the time and effort saved in building a prototype can be used developing an application. With a growing portfolio of Personality and Application Modules – all of which interoperate seamlessly on the EDP baseboard – engineers finally have a rapid prototyping platform that meets their needs. The EDP baseboard and modules have

been developed by RS to provide greater reliability, affordability and flexibility and each PCB meets stringent signal integrity specifications to ensure reliable operation. The components used are all well established and manufactured by leading vendors including Infineon, NXP, Microchip and ST Microelectronics. Each module conforms to the EDP standard and can be fitted in any position, in any combination, in the two- or four-slotted EDP baseboards.

6 April 2010

Components in Electronics

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