The single-layer multi-touch applications, mass production of which has been enabled by touch IC designer Goodix' technology, requires only a single layer of ITO film to support 5- to 10-point touch. Previously, the technology worked well only on small-size touch panels, but Goodix has made improvements to enable mass production of the technology on 7- to 8-inch touch panels.Goodix's medium-size panel clients include China-based makers O-film and Top Touch and their products are mainly shipped to Lenovo. The two touch panel makers will also stand a chance of enterin the supply chain of Intel's Windows-based white-box tablets.The technology has been considered the best solution for mid-range and entry-level smartphones because it can reduce the use of ITO films down from two to one and still features touch capabilities similar to those of traditional GFF technology. Since the second half of 2012, when the technology entered mass production, single-layer multi-touch panels have seen growing penetrating in China's smartphone market.However, the single-layer multi-touch technology's high-precision sensors still require the kind of photolithography tools that is usually needed to handle ITO film. For thin-flim touch makers, switching to the single-layer multi-touch technology would mean extra equipment costs. But for glass-based solution suppliers, they already own such photolithography tools, and would find it easier and cheaper to adopt sigle-layer multi-touch technology.Several LCD panel makers also use the technology to mass produce on-cell embedded touch panels, tapping the mid-range and entry-level smartphone touch panel market. The technology has given a breakthrough to glass-type touch panel player who were losing out in the market.Currently, the price of a GFF-based 5-inch touch panel is about US$6 at the lowest, while a single-layer multi-touch equvilanet is about US$5, according to estimates by Digitimes Research.For the production of single-layer multi-touch panels, the thin film-type is technically efficient, while the glass-type has a higher yield rate. The thin film-type currently accounts for the majority of single-layer multi-touch panel shipments, with a 70% share against the glass type's 30% in China's smartphone touch panel market.With the single-layer multi-touch technology expading its reach to larger-size panels, the mainstream sizes of related touch panels have already risen to 5- to 5.5-inch, amid China telecom carriers' move to cancel subsidies for 4.5-inch smartphones.As the market demands for cheaper tablets, Goodix has since first-quarter 2014 started cooperating with touch panel makers to push the single-layer multi-touch technology into the 7- to 8-inch tablet market. Lenovo, which has been aggressively expanding in emerging markets, was the earliest adopter of such touch panels, which come from O-film and Top Touch.China-based BYD, which is aggressively seeking tablet ODM orders from first-tier vendors as well as Intel, and which is seeking to establish a firm foothold in the tablet market, may also adopt the technology to reduce costs.

Global tablet shipments reached only 58.56 million units in the first quarter of 2014, down almost 30% sequentially, but up 4.6% on year despite Samsung Electronics trying to boost both its high-end and entry-level tablet shipments and Lenovo pushing shipments to meet its fiscal 2013 targets. Seasonality, Apple seeing weaker sales, and the tablet market growing mature were also factors that affected shipment performance, according to Digitimes Research.Shipments of iPads suffered both on-year and sequential drops to reach 15.85 million units in the first quarter. Non-iPad tablet shipments were 22.31 million units, down 20% sequentially, but up over 30% on year thanks to strong demand for Samsung, Lenovo and Asustek's Windows-based models. White-box tablet shipments reached only 20.4 million units due to seasonality and labor shortages during the Lunar New Year holidays.Apple and Samsung remained the top-two vendors in the first quarter, but the two players' market share gap was less than 6pp. Lenovo was the third-largest vendor, followed closely by Asustek Computer in fourth. Amazon and Google dropped to number seven and ten.Taiwan ODMs shipped 22.15 million tablets together in the first quarter, accounting for less than 60% of global shipments. The largest maker, Foxconn Electronics (Hon Hai Precision Industry), and second-largest Pegatron Technology both suffered significant shipment drops due to lower-than-expected demand for iPad. Quanta saw increased shipments in the quarter because of Asustek's T100 tablet, and returned to being the third-largest maker in Taiwan. Compal Electronics' shipments suffered a sharp decline because Amazon's Kindle Fire range is approaching the end of its lifecycle, while Acer is turning to cooperate with China-based makers, Digitimes Research's figures showed.

Microsoft's operating system business has been seeing internal conflicts and external threats in areas such as technology development, partner relations and operating model. Without a clear long-term strategy, the software giant will need to gradually improve these issues soon, according to Digitimes Research. In terms of technology development, demand for the new desktop Windows operating system has been weak since Microsoft has placed its focus on strengthening Windows 8's touchscreen control, causing an inconvenience for users who are used to mice and keyboards. Windows RT 8.1 is currently having issues over weak performance and lack of applications, while Windows Phone is seeing problems in application compatibility. As for the partner relations, PC brand vendors are gradually accepting Google's Chrome OS and even trying to provide dual-OS solutions. Microsoft's Surface tablets also created a conflict of interest with its tablet vendor partners. With Windows-based smartphones continuing to fall behind Android-based models, most smartphone vendors have placed less attention on Windows Phone and started dropping support after the software giant's acquisition of Nokia. In terms of operating model, Android has always been free, while Apple also started offering OS X for free with the release of 10.9, but Microsoft continues to charge licensing fees which its putting pressure on its operations. To gain competitiveness, Microsoft announced in April free licensing for smart devices with a 9-inch and below display. Such a strategy is expected to help Microsoft regain some momentum in the smart device competition, Digitimes Research analyzed.

System on chip (SoC) solutions for Ultra HD TVs are expected to become more mature in 2015 as Ultra HD content, transmissions and display technology develop, according to Digitimes Research.Ultra HD TV SoCs have seen limited development as related technologies have yet to increase from Full HD to Ultra HD, but as market demand for such technologies increases Ultra HD TV SoCs will as well, particularly from 2015 when Ultra HD TVs are expected to see a significant increase in demand, added Digitimes Research.

BOE and China Star Optoelectronics Technology (CSOT) focused on large-size panel technology at FPD China 2014, according to Digitimes Research.The makers displayed their latest Ultra HD TV panels in addition to other large-size LCDs.Tianma Microelectronics meanwhile emphasized displaying small- to medium-size panels.Digitimes Research believes profitability in the TV panel segment is becoming increasingly difficult as the TV market matures, thus panel makers in China are focusing on high-end technologies such as Ultra HD.

Qualcomm has received recognition from brand vendors for its mobile application processors (APs) based on its in-house developed architecture. However, its competitors have started to pick up their pace in releasing new products, and the CPU cores have become less important in SoC products. Amid such developments in the industry, Qualcomm has been forced to rethink its in-house AP development.Qualcomm has been using its asynchronous Symmetrical Multi-Processing (aSMP) technology to build multi-core processors. With the technology, each core can function independently, providing reasonable performance and power consumption without the need for substantial integration of processor cores. It has helped Qualcomm products stay popular in the market.However, ARM has also integrated a similar technology into its processor design and has been improving its structures rapidly. Qualcomm's in-house R&D is now hardly able to keep up with the pace. As a result, in addition to mid-range and entry-level product lines, Qualcomm has also decided to start adopting ARM's native structure design for its high-end products, Digitimes Research explains.

Optimizing its experience of shipping LCD driver ICs for HD displays used in iPads, Korea-based Silicon Works is expected to ramp up its shipments of display driver ICs for Ultra HD TV applications in 2014, according to Digitimes Research.Silicon Works has entered the supply chains for iPad and MacBook through LG Display (LGD), with shipments of its LCD driver ICs for tablet applications reaching over 40% to its overall sales at the highest.However, sales of Silicon Works' LCD driver business declined 14.8% on year to KRW322.65 billion (US$309.45 million) in 2013 due to a lack of new iPads and MacBooks in the first half of the year.Although sales of Silicon Works' LCD driver ICs did bottom out in the second half of 2013, its revenues have not yet rebounded to over KRW100 billion a quarter as it posted in each of the last three quarters of 2012.In comparison, Silicon Works' revenues in 2012 were lagging behind Taiwan-based rivals Novatek Microelectronics, Himax Technologies, Raydium Semiconductor and ILi Technology (Ilitek) but ahead of Orise Technology. In 2013, Silicon Works' ranking dropped to the last position among the six vendors, but still with its operating margin higher than that of Ilitek's or Orise's.In 2014, Silicon Works is also expected to integrate its time controller ICs and power management ICs with LCD driver parts to further expand its sales. It has also begun shipping its LED driver ICs to LG Innotek and also delivering car-use ICs to clients for validation.In addition to Silicon Works, most other Korea-based display driver IC vendors, including Lucid Display Technology (LDT), Clover Hitech and Technology Leaders and Innovators (TLI) also suffered a setback in sales in 2013.LDT and Clover Hitech have seen shipping their display driver ICs to Samsung Display, but their shipments to Samsung Display have been less than those shipped by Silicon Works to LGD, resulting in a widened gap between the first- and second-tier driver IC suppliers in Korea, Digitimes Research commented.

Chi Mei Communication Systems (CMCS) saw a significant increase in handset shipments in first-quarter 2014, because of Nokia's joint design manufacturing (JDM) orders for feature phones, while Compal Communications also achieved sequential shipment growth. Only Arima Communications suffered a slight drop.Overall handset ODM shipments from Taiwan makers grew sequentially.HTC's own-brand handset shipments continued to drop in the first quarter since its mainstream handsets had already been on the market for quite a while and demand for its new mid-range models launched at the end of fourth-quarter 2013 and first-quarter 2014 was weaker than expected.With ODMs' shipment growth almost offseting the drop in own-brand shipment s, Taiwan's overall handset shipments in the first quarter declined only 1.6% on quarter, but on an annual basis, they rose 40%, figures collected by Digitimes Research show.As for smartphones alone, Taiwan's ODM shipments declined in the first quarter due to seasonality. Moreover, HTC's new own-brand flagship model was not unveiled until the end of the first quarter. As a result, Taiwan's smartphone shipments decreased 16.8% sequentially in the first quarter.

Sales of Windows-based tablets in Japan have been rising as vendors have been aggressively releasing Windows 8.1-based 8-inch models since October 2013. In February 2014, 15.7% of Japan's tablet sales were contributed by Windows-based models, up significantly from a year ago and also larger than the Windows tablet's share of 2% in the worldwide tablet market, according to figures from Japan-based BCN.With Windows tablets gaining market share, Japan's tablet market is expected to see a more balanced development, but competition between iOS, Android and Windows will remain keen in 2014, Digitimes Research believes.In 2013, Apple still dominated Japan's tablet market, followed by Asustek Computer (Android). Microsoft, Amazon and Sony were the third to fifth largest vendors. While Amazon and Sony have been in Japan's tablet market for a while, Microsoft's surge to the third position shows that demand for its Surface tablets have been rising strong in Japan.Microsoft's second-generation Surface tablets are enjoying strong sales in Japan, but four out of its nine versions (two for the consumer market and two for the enterprise market) have been suffering from shortages in the country due to the software giant's misjudgment on related demand.The shortages also caused Microsoft to miss out on business opportunities from Japan's year-end shopping season in 2013.

Metal mesh technology has entered mass production at some China-based touch panel makers, such as O-film, since the second half of 2013. It helped O-film become the largest notebook touch panel supplier in the world in the fourth quarter of 2013, thanks to its pricing advantages. Lenovo was one of the early adopters of metal mesh touch panels for its notebooks.Following its sucess in the notebook market, O-film is looking to expand into the 8- to 10-inch medium-size segment in 2014. But Digitimes Research believes the metal mesh sector will have to step up efforts defending its stronghold at the 13- to 15.6-inch segment against traditional GFF applications starting from the second quarter of 2014, as ITO films' pricing has been dropping and resistance issues have also been improving.ITO film's high resistance has prevented GFF touch panels from entering the 13-inch and above segment, while costs of OGS touch panels are too high.The major drawback of metal mesh touch panels is that users are able to see the internal touch sensor on screen, but such an issue is not much of a problem for larger-size applications and therefore the technology has been considered the most suitable solution for large-size applications, such as touchscreen notebooks and all-in-one PCs.China-based makers, such as O-film, started mass producing related touch panels in the second half of 2013 and have been gradually expanding their shares in the notebook touch panel market. However, Taiwan players, such as TPK, which originally expected demand for OGS-based notebook touch panels to pick up, have suffered losses and reduced the related capacity to minimize the damage.Having resolved the problem with touch sensor visibility of metal mesh technology, O-film is looking to expand into the 8- to 10-inch tablet touch panel market in 2014 and enter Samsung Electronics' supply chain. However, initially, O-film will mainly supply touch panels for Intel-based white-box tablets.Meanwhile, Japan-based Fujifilm has been reducing the price of its metal mesh touch sensors, which are shipped mainly to touch panel makers, such as Taiwan-based Young Fast and China-based Eely, for their production catering to first-tier vendors including NEC and Dell. In the future, the Japan-based maker may become a strong competitor of O-film vying for Samsung's orders.ITO film makers, such as Japan-based Nitto Denko, have cut their ITO film prices down from an average of CNY300 per square meter originally to only CNY200 recently, with films' resistance values having also been reduced from 150-200Ohm/square to 100Ohm/square. The improvements have enabled ITO films specifically for 13- to 15.6-inch notebook touch panels and the films are already available in the market.Although GFF technology is still unable to match metal mesh technology in the 13- to 15.6-inch large-size touch panel segment in terms of material costs, limited metal mesh-based touch panel supplies and GFF technology's high yield rate thanks to its relatively mature manufacturing process may turn some downstream vendors to adopt GFF technology instead.For the medium-size segment, where ITO films' resistance is almost not an issue, GFF technology has advantages over metal mesh technology in terms of material costs, hindering metal mesh's expansion into the medium-size segment.