The coronavirus outbreak in China has widespread impacts on the ICT supply chain. Although many makers are supposed to resume production in China next week or in mid-February if no further complications occur, they cannot tell how normal their operations will be. Notebook ODMs estimate their utilization rates will be 50-70%, depending on the numbers of workers able or willing to return to work and material supply conditions. Companies in other sectors face the similar uncertianties and China-based panel makers, including BOE, CSOT and Tianma, who have fabs in Wuhan - the epicenter of the outbreak - could fare worse. For the mobile device market, the first year for the 5G era got off to a really bad start. Demand for 5G smartphones is likely to bt hit by the outbreak, which in turn will dampen sales of mobile DRAM.Notebook ODMs to see coronavirus hit production: Taiwan-based notebook ODMs, which operate their plants mainly in China, have estimated their production utilization rates will range from 50% to 70% after resuming operation following the extended Lunar New Year break, as employees' return and supply of components and materials are being disrupted due to the coronavirus outbreak.LCD fabs in Wuhan may suffer material shortages: LCD fabs run by BOE Technology, China Star Optoelectronics Technology (CSOT) and Tianma Microelectronics in Wuhan - the epicenter of the coronavirus outbreak - may suffer a shortage of upstream raw materials due to mounting transport curbs in China as a means to contain the epidemic, according to industry sources.Mobile DRAM demand uncertainty emerges: Mobile DRAM demand for smartphones is likely to disappoint in the first half of 2020, as the coronavirus outbreak may hit sales of new 5G-compatible phones, according to market sources.

Fintech startup business Aifian in 2019 launched its AI Chia Chia, an artificial intellignece-based app functioning as a broker for personal credit information, and has partnered with DoDoHome, a large car parking service provider in Taiwan, for initial commercial use, according to company founder and CEO Ocean Liu.Using AI and chat robot technology, AI Chia Chia collects users' personal credit information via conversation for a few minutes, Liu said. Then, the app can use AI-based algorithms to undertake cloud-based analysis of such information to profile personal credit rating, which is expected to be helpful for users applying for small-amount credit loans, Liu noted.Aifian targets car parking service providers, airline companies and e-commerce operators as partners for use of AI Chia Chia, for they focus on payments by credit cards, Liu indicated, adding that Aifian aims to tap overseas markets.So far, there are nearly 122,000 users of AI Chia Chia, according to Aifian's website.Notebook- and smartphone-based use of AI Chia ChiaPhoto: Aifian

Global tablet shipments totaled 43.23 million units in the fourth quarter of 2019. Shipments from China's white-box players weakened in the quarter due to their need to digest inventory, while brand vendors mostly saw increased shipments thanks to seasonal momentum, according to Digitimes Research's latest tablet report.As the tablet market enters the traditional slow season and China's coronavirus outbreak has extended the Lunar New Year holidays there by 1-2 weeks, global tablet shipments are expected to arrive at only 28.56 million units, a new low, estimates Digitimes Research.Apple was the largest tablet vendor worldwide in the fourth quarter of 2019 thanks to mass shipments of its 10.2-inch 7th generation iPad. Samsung Electronics was in second place, followed by Amazon in third, Huawei in fourth and Microsoft in fifth. Lenovo fell out of the top-5 in the fourth quarter of 2019.Amazon will drop to fourth place in the first quarter of 2020 due to a major decline in shipments, giving the third place to Huawei. Microsoft will remain fifth.Shipments of tablets with 10-inch and above displays accounted for 70% of the global volumes in the fourth quarter of 2019, while those with 8.x-inch displays also enjoyed a rise in share to over 17%. The share of 10-inch and above models will continue to rise to nearly 75% in the first quarter of 2020, while 7-inch devices' share will drop to 5.7%, down from 10.7% in the previous quarter due to Amazon's sharp shipment decline. The 8-inch form factor will take over the 7-inch one to become the mainstream size for inexpensive tablets.Amazon's tablet shipment drop in the fourth quarter 2019 affected the shipment share of tablets with GFF touchscreen technology, allowing the percentage of those with in-cell technology to pick up. Amazon's expected sharp shipment decline in the first quarter of 2020 will significantly benefit the shipment share of in-cell-based tablets.Of Taiwan's tablet shipments, over 50% will be contributed by Foxconn Technology Group (Hon Hai Precision Industry) in the first quarter of 2020, a new high since the second quarter of 2018 because of orders for iPad Pro (2020). China-based BYD has entered Apple's table supply chain in 2020 and will take away a part of entry-level iPad orders from Taiwan makers. Since BYD is still new, orders it has received will not significantly affect Apple's other existing partners in the first quarter of 2020.Global tablet shipment share by vendor, 1Q19-1Q20 (%)Source: Digitimes Research, February 2020

The coronavirus outbreak is definitely having short-term impacts on the supply chain in China. The memory sector was heading for recovery before the outbreak, with prices on the rise. Now memory prices are likely to rise at a slower pace as clients in China are more reluctant to fill their stocks. For Taiwanese ASIC vendors, shipments in first-quarter 2020 may be affected by the outbreak, but their clients in China have assured them that overall orders will remain significant. In the notebook maket, global shipments are expected to drop in the first quarter of 2020, according to Digitimes Research.Memory prices to rise at slower pace: Memory chip prices are likely to rise at a slower pace in February, as buyers in China are holding a wait-and-see approach, according to industry observers.Taiwan ASIC makers see little impact on China orders despite outbreak: Taiwan-based ASIC solution suppliers have to delay postpone shipments to Chinese clients in the meantime amid the coronavirus outbreak, but their longer-term orders from China will remain unaffected, as clients there will continue to reduce reliance on US suppliers of vital IC components, according to industry sources.Digitimes Research: Global notebook shipments to decline in 1Q20: Global notebook shipments were weaker-than-expected in the fourth quarter of 2019 due to Intel's ongoing CPU shortages and major brands stopping stocking extra inventory in the wake of easing US-China trade tensions. However, annual shipments in 2019 still grew 4.1% on year, according to Digitimes Research's notebook tracker.

Global notebook shipments were weaker-than-expected in the fourth quarter of 2019 due to Intel's ongoing CPU shortages and major brands stopping stocking extra inventory in the wake of easing US-China trade tensions. However, annual shipments in 2019 still grew 4.1% on year, according to Digitimes Research's notebook tracker.Seasonality, continuous shortages of Intel CPUs and the fact that the replacement trend of Windows 10 models in the enterprise segment has reached an end will result in global notebook shipments slipping by a double-digit percentage sequentially and a drop on year in the first quarter of 2020, estimates Digitimes Research.Leading brand Hewlett-Packard (HP) is expected to suffer from a dramatic shipment decline in the first quarter of 2020 because of an internal business reshuffling, unclear strategy for its new products, high channel inventory and tight CPU supply.Second-place Dell will also see a slip in first-quarter shipments because of seasonality. The proportion of Dell's outsourcing to Taiwan-based ODM is also expected to rise slightly in the quarter. As most enterprises have already completed substituting their old PCs, demand from the enterprise segment in the first quarter may be weaker than that of the consumer one.Asustek Computer is expected to remain the fourth-largest brands worldwide in the first quarter, but the company has continued to be seriously undermined by Intel's CPU shortages as the company has not been keen on adopting AMD's solutions.ODM Compal Electronics will see its share in Taiwan's overall notebook shipments rise in the first quarter thanks to increased orders for enterprise notebooks from HP. However, Inventec's share will slip due to losing HP's orders.The analysis does not take into consideration of the impact from China's coronavirus outbreak. Currently, Taiwan ODMs' plants in China and most of the country's logistic systems are in suspension and are unlikely to resume operation until February 10. With over 90% of notebooks manufactured in China, global notebook shipments may dip another 10-20% from the current estimation.

China-based handset makers shipped a total of 194 million smartphones worldwide in the fourth quarter of 2019, up 0.6% on quarter but down 4% on year, Digitimes Research has found.Smartphone shipments from Chinese vendors will continue to fall on a yearly basis in the first quarter of 2020 as the local economy and job market in China will remain weak and the replacement demand for 5G models has yet to emerge. Their overseas shipments will also be trending downward amid unfavorable market conditions.It will be particularly difficult for Chinese handset vendors to ramp up their shipments to retail channels in China in the first quarter due to higher inventory levels that channel operators built up in the previous two quarters.While managing to maintain its status as the top handset vendor in China, Huawei saw an annual decline in overseas shipments in the fourth quarter of 2019 after losing Google's GMS (Google Mobile Services) support.Overall shipments from three other top-four vendors - Xiaomi, Oppo and Vivo - posted both sequential and yearly growths in the fourth quarter thanks to robust overseas shipments.

Smartphone AP shipments in China reached a total of 197 million units in the fourth quarter of 2019, down 5.9% on year and 7.7% sequentially with volume for the whole year arriving at 776 million units, down 3% on year. As smartphone brands were cautious about their AP inventory levels, their order pull-in in fourth-quarter 2019 preparing for the Lunar New Year shopping was not very strong, according to Digitimes Research's latest report about smartphone AP shipments in China.Shipments in the first quarter of 2020 are estimated to drop to 146 million units due to China's weakening economy and not yet fully completed 5G infrastructure as well as a lack of a killer application and government subsidies, Digitimes Research's numbers show. The coronavirus outbreak is further dampening demand.Since consumers are anticipating cheaper 5G smartphones in the second half of 2020, significant replacement trend has not yet emerged.Qualcomm, MediaTek and Hisilicon are now shipping both 4G and 5G APs, which will significantly increase shipments of APs made via 7nm/8nm processes and raised their shipment proportion to 36.7% in the first quarter of 2020.Hisilicon is expected to suffer from a dramatic shipment decline in the first quarter of 2020 as Huawei, its key client, has high smartphone inventory level as a result of the smartphone brand's keen order pull-ins in the second half of 2019 to achieve annual target of 240 million units.Qualcomm and MediaTek are both expected to see rising shipment shares in the quarter, but MediaTek is expected to gain advantages in the 5G/4G AP competition against Qualcomm thanks to its APs' high price/performance ratios.To ease off its disadvantages, Qualcomm has recently slashed the price of its Snapdragon 765 5G AP, but the price cut is unlikely to start benefiting Qualcomm's shipments until the second quarter.

Huawei is the top smartphone vendor in China. But its sales have been under much pressure, first from the US trade ban, and now the coronavirus outbreak that has promised to dampen 5G phone replacement demand. Huawei is set to see major impacts. But construction of 5G infrastructures continues despite the outbreak. IC distructors expect the order momentum for chips and components used in 5G base stations to last for at least 2-3 years. And even Huawei's supply chain partners have asked optical components suppliers to deliver shipments as soon as they resume production next week.Huawei facing extra pressure on smartphone sales: Huawei is facing added pressure on its smartphone sales in 2020 as rising handset inventory levels in China's channels are being compounded by the coronavirus outbreak, according to sources at Taiwan's handset supply chain.Chip demand for 5G infrastructures remains significant: Taiwan-based IC distributors WPG Holdings and WT Microelectronics, despite the coronavirus outbreak in China, continue to see significant demand for chips and components used in 5G base stations and infrastructures, and such momentum is expected to last at least 2-3 years, according to industry sources.Optical devices makers asked to step up shipments for China 5G base stations: The locakdown of Wuhan, the epicenter of coronavirus outbreak and China's production hub for optical communications components, may dent the construction of 5G base stations in the country, but Taiwan's optical semiconductor devices makers have been asked by their Chinese clients in the supply chain of Huawei to deliver shipments soon after they resume operations on February 10, according to industry sources.

Smartphone shipments to the China market are expected to fall over 10% on year in the first quarter of 2020 affected by seasonality, insufficient supply of 5G models, high inventory levels in the channels and the ongoing coronavirus outbreak, according to Digitimes Research.Sales of smartphones in China were weak in the fourth quarter of 2019 as macro-economic conditions were shaky amid the bruising trade dispute with the US, sales of 5G models were slackened due to their high pricing, and telecom operators were not offering meaningful subsidies for the purchases of 5G models.Overall smartphone shipments to the China market slid 1.5% on quarter and 7.2% on year in the fourth quarter of 2019, Digitimes Research has found.Huawei, Vivo, Oppo, Apple and Xiaomi were the top-five brands in the order in China in the fourth quarter, with their combined market share reaching 95.9%, down 0.2pp from a quarter earlier.Apple saw its iPhone shipments increase 40% sequentially in China in the fourth quarter, replacing Xiaomi as the fourth-ranked player in the market. Huawei also posted a sequential 40% shipment growth in the quarter, while shipments from Vivo, Oppo and Xiaomi continued to wane.

Many Taiwan-based IT firms are feeling the heat from the coronavirus outbreak that is delaying their production from returning normal following Lunar New Year. But TSMC and UMC have revealed that their fabs in China have been running as usual. Despite the foundry houses' reassuring revelations, many Taiwanese IC designers have turned cautious about their first-quarter 2020 performances, with some already lowering their sales guidance. For the displays industry, the virus-imposed lockdown of Wuhan may have serious consequences, as the Chinese city is home to several major LCD and OLED panel fabs of China-based makers.TSMC, UMC say production in China remains normal: Taiwan Semiconductor Manufacturing Company (TSMC) and United Microelectronics (UMC) have both said that production at their fabs in China stays on track and has not been affected by the coronavirus outbreak.Taiwan IC design houses turn cautious amid coronavirus outbreak: Taiwan-based IC design houses have turned cautious about customer orders particularly orders for the China market due to the coronavirus outbreak, with some already revising downward their sales guidance for the first quarter by 5-10%, according to industry sources.Coronavirus outbreak likely to complicate global panel supply: The lockdown of Wuhan due to the coronavirus outbreak could impact global panel shipments as the Chinese city is one of the major production bases for a number of China-based panel makers.