Growing Acceptance of LTE Technology Creates a Flourishing Chipset Market

by: Zacks Investment Research

Long Term Evolution [LTE] technology is ahead in the race of the most sought after next-generation [4G] wireless network standard in the market. The 4G wireless networks are aiming to cope with substantial demand for high-speed wireless data services and mobile video. The growing acceptance of LTE technology has prompted the mobile handset makers to develop phones that will be compatible with this network. Qualcomm Inc. (NASDAQ:QCOM) one of the key developers of Orthogonal Frequency Division Multiple Access [OFDMA] based chipsets, recently introduced a new family of multi-mode chips that can support 3G HSPA and LTE technologies at the same time.

Nokia Corp. (NYSE:NOK), the largest mobile phone maker of the world, is expected to launch LTE-based mobile handsets by 2011. The company has entered into an agreement with Infineon Technologies AG (IFX) to develop transceiver chips for Nokia's 4G modems that use LTE technology. Rumors are rife within the broadband industry of an expected deal between the iPhone maker Apple Inc. (NASDAQ:AAPL) and Verizon Wireless (NYSE:VZ) to introduce a new LTE-compatible iPhone.

Industry sources also predicted that the first LTE handsets may arrive in the market by the second half of 2010, but these next-generation smart-phones may be mass-marketed by early 2012. NTT DoCoMo (NYSE:DCM) will launch LTE handsets in 2011 compatible with its current 3G network, enabling the customers to access services even if they are outside an LTE coverage area. LG Electronics and Samsung Electronics on the other hand have already given a demonstration of LTE-based modems. LTE is expected to achieve download transmission speeds of 100 Mbps and offers several advantages over other wireless techniques.