Qualcomm's top-notch product in 2015, the Snapdragon 810, has been rumored to have defects and see unstable mass production with some media even speculating that volume production for the application processor (AP) would not start until the second quarter of 2015. However, judging from LG's and Xiaomi's scheduled launches of their Snapdragon 810-based new products, as well as information gathered by Digitimes Research, the Snapdragon 810 has already entered mass production.The AP may have some defects but they have not stopped vendors from adopting it into their products. Compared to some other more serious problems that may affect Qualcomm's loing-term competitiveness, the Snapdragon issue is minor.The Snapdragon 810 is Qualcomm's first design adopting the ARM 64-bit big.LITTLE architecture into its high-end platform. With a 20nm manufacturing process, the AP's performance is expected to have a dramatic improvement from previous top-of-the-line solutions.Since the AP only uses ARM's standard architecture, the CPU part will lack uniqueness compared to other solutions and since competing APs using the same architecture are already available in the market, some market watchers are also skeptical about the Snapdragon's competitiveness.Digitimes Research believes Qualcomm, which has never adopted big.LITTLE architecture in its products prior to the Snapdragon 810, may be in disadvantages competing against Samsung Electronics over software optimization.Samsung's 64-bit big.LITTLE Exynos architecture has already entered the second generation. It has rich experience in the 20nm manufacturing process, and it plans to enter a 14nm manufacturing process in 2015. The Korean vendor, who has amassed a lot of experience in software/hardware integration for the big.LITTLE architecture, is expected to pose a great threat to its US-based competitor.Compared to Samsung's 20nm products, Qualcomm's device still has some integration advantages, but against China-based Hisilicon's 16nm or Samsung's 14nm integrated products, its advantages are much less obvious.Samsung's plan to integrate its APs with baseband chips in 2015 has prompted Qualcomm to enhance the Snapdragon 810's pairing baseband chip's specification from LTE to Cat.9, aiming to strengthen the AP's competiveness to prevent its competitors from catching up too quickly.As for the Snapdragon 810's issues, Qualcomm's clients are more concerned about the immaturity of the platform's base software, and the hardware issues are not too much of a problem for them.MediaTek's high-end AP the MT6595 in 2014 had an issue over DDR SDRAM's port physical layer (PHY), causing the AP's power consumption during idling to be over 30% higher than during standard operation and creating excessive heat. However, the product continues its mass production schedule as originally scheduled and Qualcomm is likely to follow suit. But problems with Qualcomm's AP are unlikely to be as bad as those of MediaTek.Digitimes Research believes the AP's defects should have been fixed by the time the next batch of devices are shipped.LG and Xiaomi were the earliest users of the Snapdragon 810. LG's products will enter mass production and hit store shelves by the end of January. Xiaomi's mass production schedule is a bit later than LG's, but the volume will be a lot more, showing Qualcomm's Snapdragon 810, despite defects, still are accepted by clients.

Global tablet shipments are estimated to drop 11.8% on year to reach 244 million units in 2015 as demand for high-end and entry-level tablets has both become saturated, while large-size smartphones and inexpensive notebooks are gradually taking demand away from the device, according to Digitimes Research's latest Special Report about the tablet industry.The 7-inch tablet segment is expected to see its shipment share drop from 51.3% in 2014 to 44.3% in 2015. Both the iPad mini series and 7-inch Wi-Fi-based entry-level Android tablets will see declining demand in 2015 and among the Android-based tablets, white-box models will see a worse drop than devices from brand vendors.As for other tablet sizes, the 10-inch and above segment is estimated to enjoy an on-year shipment growth of 20% in 2015 as vendors start seeking opportunities from the enterprise and specific industrial applications.Digitimes Research's Special Report on the global tablet industry estimates that iOS and Android will both see their shipment shares decline in 2015. Although Apple's 12.85-inch iPad will boost iOS' share in 2015, the growth will not be sufficient to offset the declines of the iPad and iPad mini.iOS-based tablet shipments are estimated to reach only 49.9 million units.Windows-based tablets will see a close to 50% on-year shipment growth in 2015 thanks to increasing shipments for high-end Intel Core M-based 2-in-1 devices, branded inexpensive tablets and high-price/performance-ratio white-box models.Digitimes Research believes that although Intel's mobile business has started devoting more efforts to smartphones, acquiring a firm position in the tablet industry is still the priority of the company and with help from products such as SoFIA and Core M series, Intel-based tablet shipments are expected to grow 50% on year to reach 40 million units in 2015.

Epistar has invested NT$825 million (US$25.94 million) to merge with TSMC Solid State Lighting (SSL), helping to enhance Epistar's capability in the lighting industry. Before the decision was made, many companies such as SemiLEDs and Advanced Optoelectronic Technology (AOT) had also been talking to TSMC SSL about merger.Digitimes Research believes the merger should benefit Epistar in strengthening its silicon substrate LED technologies to improve its competitiveness in the global market in the future.TSMC SSL only has five production machine sets, a limited contribution to Epistar's overall capacity, but TSMC SSL's manufacturing process technology will become a complement for Epistar, which mainly manufactures LED chips via sapphire substrates, since these machines are able to conduct middle-level packaging with technologies that cover upstream epitaxial manufacturing process for silicon substrate LEDs as well as supporting midstream's Phosphor on Die (PoD) and Epoxy Molding Compound (EMS) technologies.With Japan's Toshiba Semiconductor having significantly raised its silicon substrate LED capacity and Korea-based Samsung and LG aggressively developing 8-inch silicon substrate LED products using their existing advantages in semiconductor technologies to save costs, Epistar's merger with TSMC SSL is expected to greatly strengthen its silicon substrate LED technologies.Digitimes Research believes silicon substrate LED chips currently still have many issues such as weak yield rates and poor lattice constants and therefore the industry will still focus mainly on supplying sapphire substrate LED chips over the next several years. However, Epistar - as the leader of the global LED industry - will still need to have a diversified development of technologies, allowing it to defend against competition from competitors' silicon substrate technology and patents in the future.Before the merger, TSMC SSL had a talk to the Foxconn Group's subsidiary AOT about merger during the second half of 2014, but their talks ended with no result.Digitimes Research believes the failure was because AOT only has a capital of around NT$1.45 billion (TSMC SSL's net value was around NT$2 billion) and its business focus on mass production of LED packaging devices, which instead of merging TSMC SSL, the company should be able to achieve lower LED die costs by purchasing from outside suppliers as there is a sufficient global supply. Since the investment will only create limited value to AOT, the two's merger was not realized.

The production value of Taiwan's IC design industry reached NT$541.9 billion (US$16.98 billion) in 2014, representing an on-year growth of 14.8%, higher than the 11.7% growth recorded a year earlier, according to Digitimes Research.Shipments of smartphone solutions gained a boost in the third quarter of 2014, buoyed by the shift from 3G to 4G standards in China and smartphone replacement demand in emerging markets, including Africa, India and Russia.Shipments of TV chips by Novatek Microelectronics and Realtek Semiconductor posted strong gains in the third quarter and sales of STB chips were also brisk due to peak-season effects. Despite flat performance of related PC chips, the production value of the IC design industry rose 5.3% on quarter and 15% on year to NT$14.47 billion in the third quarter of 2014.Buoyed by demand for IC parts from the smartphone sectors in emerging markets and an easing of 8-inch wafer production capacity at wafer foundry houses, the production value of the industry climbed 12.1% on year to NT$140.9 billion in the fourth quarter although the amount was down 2.6% from the previous quarter, said Digitimes Research.

Following developments to push Ultra HD TVs in the market vendors have begun to promote curved units as well and aim to push the technology throughout 2015-2016. However, due to higher panel costs, limited market prospects and higher retail pricing, shipments during the time period will be limited, with only about 2.8-3 million curved LCD TV panels shipped in 2015, according to Digitimes Research.Panel pricing for curved units with similar specs to flat TV panels is still relatively more expensive. Currently, 55- and 65-inch curved LCD TV panels have 30% higher costs than flat TV panels, but overall are still cheaper than OLED TV panels.Due to high OLED material costs, in 2015 curved OLED TV sales are unlikely to break 800,000 as a result. However, as OLED TV panel costs drop consumers could see curved OLED TVs be the most widely accepted choice of curved TVs as early as 2018. OLED TVs do not require backlighting, unlike LCD TVs, and will have advantages in achieving curved, stylish features.Meanwhile, Digitimes Research also estimates that curved LCD TV shipments will exceed quantum dot LCD TV shipments in 2015.

Panasonic is showcasing an Ultra HD Blu-ray Disc player (BDP) prototype at CES 2014 and is the only exhibitor with such a device at the show. Digitimes Research believes Ultra HD BDPs will wait at least until the end of 2015 before hitting store shelves, but demand may pick up in 2016.Panasonic's staff at CES told Digitimes Research that the Ultra HD BDP supports content in Ultra HD resolution, 60Hz refresh rate and 10bit grayscale technology and is encoded via HEVC (H.265) codec. As for the storage media, the Ultra HD Blu-ray disc (BD) will have two formats: dual-layers (66GB) and 3-layers (100GB). Currently, Full HD BD has two formats: single-layer (25GB) and dual-layers (50GB).Compared to the pace of announcing BD support for the 3D format soon after arrival of 3D TVs, the Blu-ray Disc Association's (BDA) move to support Ultra HD content has been rather slow.The Panasonic staff confirmed that BDA will announce Ultra HD BD starndards in the second quarter, but the company has not yet had a firm schedule for Ultra-HD BDP's mass production and could launch the device at the end of 2015.With Ultra HD TVs' production approaching maturity, the birth of 60Hz SoC solutions in 2015 with the integration of HDMI 2.0 and HEVC, will prompt inexpensive Ultra HD TVs to appear in the market. The only obstacle to the Ultra HD TV market is the content.Digitimes Research believes more Ultra HD content should be available after the establishment of the Ultra HD BD standards since many digital movies are being filmed using Ultra HD resolution and movies filmed using traditional film can also be digitalized to Ultra HD quality.

December average retail price for 7W LED light bulbs (equivalent to 40W incandescent ones) in the China market decreased by 8.7% on month to CNY35.7 (US$5.8), while that for 9W models (equivalent to 60W incandescent ones) decreased by 9.1% to CNY37.1, according to Digitimes Research.Average retail prices for 40W- and 60W-equivalent LED light bulbs in the Japan market in December stood at JPY1,698 (US$14.0) and JPY3,265 respectively, with the former rising by 2.6% on month and the latter by 3.9%, Digitimes Research indicated.December average retail prices for 40W- and 60W-equivalent LED light bulbs in other markets were: KRW11,402 (US$10.2, up 0.3% on month) and KRW14,361 (down 0.3%) in South Korea; US$17.9 (down 3.8%) and US$19.6 (down 4.4%) in the US; EUR9.5 (US$11.6, up 1.1%) and EUR14.1 (down 2.1%) in Europe.LG Electronics 40W-equivalent LED light bulbs for sale in the Europe market and Philips 60W-equivalent models in the South Korea market had the highest average lumen-price ratios of 81.6lm/US$ and 96.2lm/US$ respectively in December. In terms of luminous efficiency, Toshiba 40W- and 60-equivalent LED light bulbs available in the Japan market had the highest average levels of 81.1lm/W and 104.1lm/W respectively.

Observing major LCD TV brand vendors' strategies for 2015, Google's Android TV has become the official platform for Sony's and Sharp's smart TVs, but vendors such as Samsung Electronics, LG Electronics and Panasonic are still resisting Android, and bent on using their in-house developed platforms to carve out their own territories in the market.During their pre-show press conferences for CES 2015, Sony and Sharp have respectively noted that Android TV will be fully adopted into their mid-range and high-end product lines in 2015, a strong advance for Google as its previous-generation Google TV platform was only available in Sony and LG Electronics' entry-level TVs.Their move also indicates that the two Japan-based TV vendors, whose market shares have been declining in the past few years, have formed a strategic alliance over their smart TV platform's development, which is expected to help strengthen the Android TV camp.Other major TV brand vendors have mostly announced their own next-generation smart TV platforms during CES 2015 such as Samsung Electronics' Tizen, LG's WebOS 2.0 and Panasonic's Firefox.With its smartphone business having difficulties breaking from the Android control, Samsung has decided to adopt its in-house developed Tizen platform into all its smart TVs for 2015, hoping to establish an ecosystem strong enough to compete with Android.LG will upgrade WebOS to version 2.0 and continue to promote the platform's easy-to-control characteristics. LG is also looking to expand WebOS' applications and is eyeing products such as digital signage and hotel's TV systems as its next targets.Panasonic announced its partnership with Firefox in 2014 and has revealed that it will put Firefox OS into its TV product lines for 2015. Digitimes Research believes Firefox OS may not help Panasonic much in its bid to expand in the TV market, but it means Panasonic is not ready to give in to Google yet.

Despite the fact that Russia's IT market has been greatly impacted by the fast depreciation of the country's currency, Digitimes Research expects demand for LTE tablets from Russia to continue growing in 2015 due to the rise of its regional brand vendors and strong consumer demand for high price/performance-ratio products.During recent visits to firms in China's supply chain, Digitimes Research discovered that China's white-box makers have been accelerating their shipments of LTE-based tablets to Russia's regional brand vendors for replacement of 3G models.Such shipments are expected to help the white-box players avoid competition from vendors of inexpensive tablets with phone functions and achieve better profits, as well as more market space for development.Demand for phone-enabled tablets started emerging in Russia in 2011. Although the country's LTE communication service users only account for 1.5% of overall users, the country was still one of the top-10 LTE markets worldwide in 2013.J'son & Partner research firm previously estimated that Russia had about 14% of its tablet shipments in the first quarter of 2014 being LTE-based models and sales for LTE-based tablets are estimated to have reached 1.7 million units in 2014, accounting for over 20% of Russia's overall tablet sales.Digitimes Research expects LTE-ready models to account for 30% of Russia's overall tablet shipments in 2015.

To find new outlets for its GPU business, Nvidia has started licensing its GPU architecture to other application processor (AP) designers. Kepler was the first GPU platform Nvidia offered for licensing and its latest-generation Maxwell will also become available for licensing later.Digitimes Research believes Nvidia is looking to rely on the licensing business and its GPU patents to penetrate into the mobile GPU market where ARM and Qualcomm combine for an almost 70% share.Although Nvidia started its GPU architecture licensing business in June 2013, the company so far has not yet obtained any orders because Kepler's size occupies a large portion of APs' space, causing a rather weak performance per area. In addition to size, potential clients have been deterred by a lack of flexibility in determining where the GPU can be placed.Nvidia's upcoming Maxwell has a performance per area about 160% better than Kepler and has a higher flexibility in the location of the GPU, allowing clients to easily achieve their desired performance/cost balances. Therefore, Digitimes Research believes Nvidia's GPU licensing business may not actually start contributing revenues until the Maxwell architecture's release.Meanwhile, Nvidia has filed lawsuits against Samsung Electronics and Qualcomm for infringing its GPU patents. Nvidia has over 7,000 GPU patents and is suing the two firms for patents related to some basic technologies such as object texture, lighting, shading, GPGPU, vertex operator. Samsung Electronics is being sued for using ARM's Mali GPU architecture.The patent lawsuits are a part of Nvidia's patent licensing plan. And if Nvidia prevails in the patent war, clients should be more willingly to use Nvidia's GPUs.