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What is In Taiwan's Huge Hardware Closet?

Apr 17 2014, 2:51am CDT | by , in News | Technology News

Wearable Devices: What's In Taiwan's Huge Hardware Closet?
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What is In Taiwan's Huge Hardware Closet?

I’ve made a record number of dead-end queries this month to find out who’s making wearable devices in Taiwan. Maybe the global tech hardware hub isn’t doing much with the fast-emerging consumer electronics sector that covers bracelets, glasses and watches sporting mini touchscreen computers. Or maybe it is but no one’s telling. The patchy results of my research point to both. First, big domestic brands such as Acer, Asustek and HTC will arrive late and take only small market shares, so there’s not a lot to say. The other trend: Parts suppliers and contract assemblers will get orders, if they don’t have them already, from overseas and keep them secret due to client confidentiality.

Acer said this week it has announced nothing. Asustek is working with a partner on something for release later this year, spokesman David Chang says without adding what or how many. Taiwan’s best own-brand prospect is HTC, which already makes a range of smartphones – closer than PCs to wearables in design terms. Like Asustek, it’s promising a long wait followed by who knows what. “HTC Chairwoman Cher Wang has stated that HTC intends to introduce a wearable device by this year’s Christmas shopping season,” the company says in a written comment this week. “While we know there is excitement for HTC to provide more details, this is all the detail we can provide at this time.”

Google has led wearables since last year with its Google Glass, specs bearing a tiny voice-activated computer ideal for, say, taking photos while bicycling. Apple is reported to be developing an iWatch for release this year. Shipments of wearables across brands will reach 9.2 million units in 2014 on the way to 112 million units in 2018, market research firm IDC says in a research report summary. Consumers will want mostly “complex accessories” such as Jawbone’s UP bracelet and the Nike+ FuelBand. Samsung’s Galaxy Gear and the Sony SmartWatch “will also take a giant step forward,” IDC says. No Taiwanese developers made the IDC shortlist.

Taiwan may keep its cloak on for now because it lacks the software packages, R&D and data collection – consider maps accumulated by Google and Apple – needed for hot wearable devices. Asustek depends on open software such as Google Android, finding the soft side otherwise too mushy for its expertise. Acer and Asustek are focusing now on building Google Chromebooks, which are next-of-kin to their own core products.

Taiwan’s flagship firms will probably make a few wearables just to say those are in their closets of other stuff that together says hey, I’m a real high tech firm. “Everybody’s going to do the watch, and everybody’s going to do the glasses,” forecasts John Brebeck, senior advisor with business consultancy Quantum International in Taipei.

Taiwan will excel in wearables by following its tradition of making consumer electronics for foreign developers. Taiwan Semiconductor Manufacturing Corp., the world’s largest contract chipmaker, last year predicted a surge in wearables, which would obviously boost orders. Himax Technologies of Taiwan does liquid crystal on silicon for the Google Glass. The government-backed Institute for Information Industry picks Hon Hai Precision, builder of anything electronic, and Quanta Computer as likely assemblers of wearable devices. “They’ve done a lot of contract work for some time now already,” notes Tracy Tsai, a research director with tech market analysis firm Gartner in Taipei.

Taiwan’s suppliers and assemblers should expect a plush wardrobe of orders over the next four years and jump in early because of its historic high tech strength, the institute says. It forecast this week the wearable device market will be worth $20.6 billion by 2018. “We get the sense that once the market for these devices catches on as the concepts draw closer to what people want, the ODM and OEM contracts will suddenly pick up sharply,” says Wai Ho Leong, senior regional economist with Barclays in Singapore. (ends)

 

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