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Litigation shows maturity of broadband cellular modem market

Posted: 01 Mar 2011 ?? ?Print Version ?Bookmark and Share

Keywords:broadband? cellular? modems? USB?

The market for broadband cellular modems is showing signs of maturity as China suppliers Huawei and ZTE dominate the arena, according to ABI Research, citing the commoditization of the USB segment as an example of the trend.

Jeff Orr, senior practice director, ABI Research, says "One can tell a maturing market by the displacement of new product innovation by litigation." He explains "This was certainly the case in the mobile broadband modem market as vendors engaged legal teams to enforce patent and IPR ownership. In December, for instance, Novatel Wireless filed a patent infringement lawsuit against Franklin Wireless and ZTE."

Another case cited by ABI Research was Option NV's asking the European Community to investigate modem dumping by Chinese suppliers in EU member states. Huawei agreed to buy Option's RF business in Germany and license its connection management software, resulting in the request being dropped.

ABI also reports that USB-format modems continue to dominate the market with nearly 125 million shipments forecast for 2013; but shipments of embedded modem modules slowed in 2010 compared to the previous year. Some vendors had entertained high hopes that 3G modem-equipped netbook sales through mobile network operators would kick-start embedded modem markets, but they were doomed to disappointment: embedded 3G modems in netbook computers just didn't gain traction with consumers. This, says Orr, was primarily because MNOs were not perceived as a leading channel for buying computers. Both Huawei and ZTE have started making embedded modem modules now, but they are not significant players there yet.

If there is hope for the embedded modem module market, it may lie with media tablets. Apple makes its own embedded modem module for the iPad, and, says Orr, "The intense interest in media tablet devices has increased hopes that embedded modules will have a higher or more significant attach rate than for other system types."

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