Suntech Power Holdings, a China-based solar module giant, said on March 11, 2013, that it has signed a forbearance agreement with the holders of more than 60% of the firm's 3% convertible notes. The forbearance agreement between Suntech and the note holders means the holders agreed to wait until May 15, 2013 to exercise their rights if Suntech does not make payments by March 15, 2013, the due date of the notes.The market has been buzzing about the likelihood of a default by Suntech. According to the New York Times, as Suntech is close to running out of cash, the firm may be taken over partly or entirely by Wuxi Guolian, a holding company owned by the municipal government of Wuxi, China, where Suntech is situated.China-based Suntech was once the largest solar producer in the world. According to a report by Solarbuzz, a market research institute, in 2010, the top two solar cell producers were Suntech and JA Solar, another China-based firm.Suntech was founded in 2001 by Shi Zhengrong, who is an Australian citizen. At the height of the firm's operation, the shares were worth around US$16 billion in late 2007, according to a report by Australia-based media, the Sydney Morning Herald. The report added that Suntech shares have been falling significantly and is currently worth around US$121 million.In the second quarter of 2011, the firm saw solar module shipments increase by 48% on year despite falling quarterly revenues and a huge net loss of US$259.5 million. By October 2011, Suntech issued a statement denying the rumors regarding bankruptcy, and in November 2011, the firm reported third-quarter net loss of US$116.4 million, a significant decrease compared to the second quarter.Despite the rumors, Suntech remained the top solar firm by module shipment volume in 2011, according to a report by IMS Research. Suntech was the first solar firm to ship over 2GW of solar modules in 2011, said IMS Research.Faced with problems such as the US anti-dumping and anti-subsidy punitive tariff and a fraud case, 2012 was a tumultuous year for the solar giant. In a press release in May 2012, Suntech said "gross profit and gross margin in the first quarter of 2012 were impacted by a provision for preliminary US countervailing and anti-dumping duties of US$19.2 million, or 4.7% of revenues." The firm reported net loss of US$133 million for the first quarter of 2012. By the end of the first quarter of 2012, the firm's debt ratio reached around 81.65% compared to 65% in the end of first-quarter 2011.Suntech soon faced another problem. The firm's subsidiary, Global Solar Fund (GSF), has been charged by courts in Italy for illegally constructing solar PV system installations to obtain subsidies. In fact, in July 2012, Suntech announced that a third-party investor of GSF may have provided fake German bonds up to EUR560 million (US$728 million) to Suntech as collateral related to security interest and the firm may have been the victim of fraud. Suntech has reached a settlement agreement on this case with the third-party investor and is currently owning a 88.15% stake in GSF, according to a company press release issued on March 7, 2013.The turmoil of the firm does not stop there. On November 15, 2012, Suntech announced plans to reduce production at its plant in Arizona, US. By March 12, 2013, the firm announced plans to close the plant by April 3, 2013. Suntech stated that the punitive tariff on China-made solar cells by the US government is one of the reasons for the firm to close the Arizona plant as solar cells are a key ingredient in making solar panels. Suntech is subject to a 35.97% punitive tariff, relatively low compared to other China-based firms that face a tariff rate of 249.96%.According to the New York Times article, Suntech stopped releasing financial results in 2012 after the announcement of the fraud case.Suntech has been facing high debt ratio in recent years. In fact, this is also the case for LDK, another solar giant in China. Both firms once ruled the global solar market. In recent years, the global solar market has been hit by turbulence such as the trade war and the rapid falls of product prices. Being heavily subsidized by the government, China-based solar firms have been criticized by competitors. China government has been using the same tactics on other industries such as display and LED. Through heavy subsidization, China is able to nurture the infant industries. But because of the heavy subsidies, firms expand too much and too quickly in numbers and capacity. The massive expansion usually results in falling product prices and a string of bankruptcies starting with small-size firms. In fact, there are many small- and medium-size solar firms in China that rely on OEM orders from tier-one firms like Suntech and LDK. The effect of the possible fall of Suntech is much greater than it appears.
Looking at the "phablet" - the hybrid of, or a bridge between, a phone and tablet - I can't help but think of the colossal military-walkie-talkie-looking first-generation cell phone.The Homo erectus of cell phones was so big that it could hardly fit into your pocket. Well, it was never meant to perhaps; for the huge device was something you would want to brandish around. It was a symbol of one's social status and wealth at a time when few could afford to own a cell phone.But then the form factor of cell phones started shrinking - as if following Moore's Law - to the point where small was the paradigm of the mobile device market. Not anymore now; the arrival of the phablet has signaled a paradigm shift - swinging back towards the large-end of the spectrum.How are we going to adjust ourselves to this paradigm shift? An inch thinner for a "walkie talkie" might not mean much, but the present mobile device market is being defined by tiny fractions of an inch.So how are consumers going to decide what phablet sizes they need? Maybe we should have "phasion" designers work out a "phace" size chart, allowing users to determine what sizes fit their faces. After all, a quarter of an inch too large may not look good on a small face. Of course, the phablet is much less about making calls than surfing the Internet and enjoying multimedia. But you would still want to look chic when you do make a phone call with a phablet, wouldn't you?
It may be an unthinkable scenario in the past, but the fact that China-based white-box ARM chipmakers are gradually winning their way into the first-tier market, has started to change the ecosystem we used to know of the IT market.Price seems to have become the only guaranteed factor to attract consumer demand in the IT market as brand vendors such as Amazon and Google have all been trying to launch mobile devices that are the cheapest of them all.For brand vendors with strong content libraries, selling hardware cheap would not greatly impact their income, but for pure brand vendors such as Asustek Computer and Acer, it would mean a serious profit drop. As a result, seeking cheaper components has become the only way pure brand vendors can break through their predicament.Hewlett-Packard (HP) recently launched its Slate 7 tablet using a processor from China-based white-box chipmaker Rockchip, while Asustek, Acer and Lenovo also plan to follow along and release tablet models using white-box ARM processors to compete in the entry-level market.With prices only half those of first-tier chipmakers and having computing performances only slightly off the first-tier chips, white-box ARM processors' advantages will only expand in the future, pushing more brand vendors to turn to purchase processors from white-box players, while prompting first-tier chipmakers to develop cheaper chips to compete.
Flexible OLED displays, which are bendable and extremely light and thin screens, are starting to be researched and developed more in depth. These paper-like devices are expected to be very energy-efficient and applied to many uses, making them one of the main focuses in the display industry for developing ultra-mobile devices in the future.Since the introduction of YOUM, a flexible OLED display made by Samsung Mobile Display (SMD), at the 2013 CES in Las Vegas, Nevada, many analysts believe flexible OLED displays will first appear in smartphones made by Samsung Electronics in 2013 while others feel that date is still too premature. According to Digitimes Research, it is highly unlikely that OLED flexible displays will be readily available for the mass public in 2013, and that SMD will need until at least the middle of 2014 before it greatly improves mass production of the technology as well as lower its costs.Samsung faces many challenges in producing the technology, including finding the right components are incorporated and ensuring their ability to withstand constant bending.The biggest difference between devices that would use OLED flexible displays and ones that do not lies with the substrate material. Market observers believe that plastic substrates (which are transparent, have low costs and can be bent and rolled) will be the main substrate choice for panel makers in order to achieve those advantages. However, fabricating a flexible OLED display is very challenging. According to reports, Samsung is still using LTPS for its plastic based panels, and the production process for LTPS is too hot for the plastic substrate, causing it to melt. This means that Samsung still has a lot of work ahead, especially if it wants to make flexible displays that bend in more places than just at the corners and slightly in the middle.There has also been very little news in terms of the development of other components that are needed for use in flexible displays. Having spoken with various supply chain resources, it has come to my attention that supply chains, whether they are semiconductor, backplane or substrate material providers, are struggling to create components that can withstand constant bending, flapping or whatever movement users can think to use with their devices. As of now, even if one component maker has a breakthrough in developing proper technology for the displays such as the substrate, it does not mean that other component makers will be able to do the same. These aspects, on top of the fact that component makers also face huge investments in pursuing further R&D to develop the technology, mean that flexible displays will most likely need more time before they arrive on the market, and that panel makers will have to work more and invest more in their supply chains in order to meet increasing demand as well as control costs.Flexible displays hold a lot of potential in the market, but consumers are going to have to be even more flexible in terms of expecting when the technology will be readily available.
Well, I don't live next door to nuclear power plants, but I live close enough to two. If they go wrong, I will definitely have to flee.I did some measurements on Google Map. The First Nuclear Power Plant (Nuke 1, as it is usually called) in the northern tip of Taiwan is about 50km from my house - which is located in downtown Taipei City (the capital of Taiwan that houses around three million people) and only about 1km from the Presidential Palace. A car ride from the plant to my home takes only one hour and nine minutes.The distance from my house to the Second Nuclear Power Plant (Nuke 2) is actually closer, only around 45km. Nuke 1 and nuke 2 are close to each other. This means, I am living in the range of 50km away from two nuclear power plants lying along the coast of New Taipei City, which has a population of six million.According to an article in the New York Times, the US Embassy recommended US citizens living within 50 miles (80km) of the Fukushima nuclear power plant evacuate on March 17, 2011, amid threats of a meltdown. That means, I live within the recommended evacuation zone if something as drastic as what happened to the Fukushima plant happens to any one of the two nuclear power plants near my city.And the Taiwan government and the state-run Taiwan Power Company (Taipower), which owns and operates all three existing nuclear power plants in Taiwan and is building another, which may be a littler farther from my house, but still close enough to send us all in the area worrying about its safety, and many calling for termination of the project.According to Taipower, the current nuclear power plants account for around 20% of Taiwan's total electricity generated. And if the three nuclear power plants get decommissioned and the construction of the fourth plant gets halted, the electricity price in Taiwan will have to increase by 40%. According to a recent article by Taiwan-based Business Today, Taipower has not been consistent about the reasons why the construction of Nuke 4 has to continued, and actually the company has changed its argument many times. Also, the figures Taipower has presented to the Ministry of Economic Affairs - the governing authority of electricity - have been changed frequently. In addition, the report added, ever since Japan shut down its 54 reactors after the March 11 earthquake (with nuclear power accounting for more than 30% of total power generated in Japan), the electricity price only increased by 17%. So how is it that Taiwan will suffer a 40% increase in electricity price when nuclear power only has a 20% share? Taipower's figures are doubly questionable because the country has yet to use the electricity from Nuke 4.Taipower's argument is that nuclear is the cheapest energy source in Taiwan. Compared to figures provided by other countries such as South Korea and China, Taiwan seems to have the cheapest nuclear power, and you cannot but wonder why nuclear energy is cheap in Taiwan, or whether Taipower's figures are biased. The skepticism is supported by the Business Today report, which claims that Taipower has been underestimating the costs of disposing nuclear waste and decommissioning. According to Taipower, the cost of producing electricity using nuclear power is NT$0.69/kWh (US$0.02/kWh). But a 2007 report by International Energy Agency (IEA), the cost of nuclear electricity from new power plants ranges from US$30-57/kWh, depending on the investments. The figures provided by Taipower are hard to believe because Taiwan imports the required equipment and components, not to mention the materials. It is nearly impossible for Taiwan to have the cheapest nuclear electricity cost compared to other countries.And the dispute over Nuke 4 is not just about nuclear safety in general but also about alleged corruption and lack of quality plaguing this specific project. In the past 16 years of construction (yes, the plant has been under construction since 1997), Nuke 4 reportedly has experienced seven cases of flooding and several fires. Also, the project has been broken into several sub-projects with contractors for each of them having little coordination between them. There have been allegations that some of the work has been illegally outsourced.The government should focus on campaigns to raise awareness of energy conservation and make the country a safe place to live in instead of constantly threatening citizens into supporting Nuke 4 with talks of imminent power shortages and increases in electricity prices. The government should help citizens to understand that as a nation that lacks energy resources, energy is very valuable. If we can rely less on imported materials to create energy, we should do so, and at the same time develop sustainable ways to maintain our quality of life.The area affected by the Chernobyl meltdown is around three times the size of the entire island of Taiwan. And that was just the blast of one nuclear power plant. Taiwan cannot afford to have any radiation leak. What if there is an earthquake - which is very common here - that stops the cooling systems of the four nuclear reactors in Nuke 1 and Nuke 2? The debate about Nuke 4 and nuclear power at large is less about how much electricity we need than how it will affect the next generations.A massive anti-nuclear protest in Taipei on March 9, 2013Photo: Jackie Chang, Digitimes, March 2013
On March 9, 2013, more than 100,000 people across Taiwan took to the streets protesting against the government's plan to continue a controversial project to build the country's fourth nuclear power plant (Nuke 4) and prolong its reliance on nuclear power. Green Party Taiwan, one of the participating organizations, demanded the government terminate the Nuke 4 project, immediately decommission the existing three nuclear power plants, remove all low-level radioactive wastes from the remote Orchid Island, and work out an energy policy to achieve the target of "zero growth of energy demand."Many of the protesters were young people and mothers with their children. Compared to many other protests that have taken place in Taiwan, this latest one was very different in that it was much less political. The government would usually label any protests as politically-motivated, but the anti-Nuke 4 protest was supported by groups of people much different from the ones in political demonstrations. A lot of young individuals made their own slogans and signs. Many celebrities also showed up to support the protest and to raise the awareness of how dangerous nuclear power plants can be. Some held signs with the Taiwanese slang "he-li-shi" - it means it will kill you, with the word "he" sounding like the Chinese character for nuclear. Some signs said "put nuclear waste in the president's residence." According to polls done by various media establishments in Taiwan, more than 50% of people surveyed want to abolish the use of nuclear power. One of the polls done by Business Today showed that 50% of people surveyed support the abolishment of nuclear power even if it means increases in electricity prices.March 11, 2013 marks the second anniversary of the earthquake-tsunami induced disaster at a nuclear power plant in Fukushima, Japan. The disaster shocked the world and especially Taiwan because Japan and Taiwan are geographically similar. According to US-based Fox News, the earthquake "blew out" the cooling systems of two nuclear reactors in Japan's Fukushima plant, meaning the two reactors did not have cooling mechanisms which were used to prevent radiation leaks. As one of the countries on the earthquake belt (also known as the Ring of Fire), Taiwan experiences earthquakes on a daily basis. With two nuclear power plants situated in the northern part of Taiwan and one in the southern county of Pingtung, it is amazing that Taiwan is still fully intact.The banner on the right says: "Stop constructing Nuke 4 for the next generation."Photo: Jackie Chang, Digitimes, March 2013
Newlans COO Divi Gupta and his small entourage recently stopped by the Digitimes office to talk up the company's reconfigurable CMOS analog designs targeting ultra-broadband handsets and chat about band fragmentation, which Qualcomm recently called "the biggest obstacle to designing global LTE devices."When it comes to mobile handsets, it's all about power and space. One challenge that LTE handset makers face is that different markets, or even different carriers within with same market, will be making use of more than 40 cellular radio bands worldwide to deliver their respective LTE services (compared to less than 10 for 3G). So while semiconductor designers are integrating more and more functions into smaller and cheaper chips, the handset makers are faced with the choice of using larger, more expensive, RF front-end modules (FEMs) to support the various LTE bands, or be forced to implement different FEMs in different markets, which in addition to the supply chain management issues, suggests a whole new level of customer support issues for world travelers.Gupta said he expects that by 2015 most major players will go with the choice of offering a global FEM in their LTE devices, with the module probably featuring multiple duplexers and two LTE power amplifiers (PA), as well as various other components bringing the part count to more than 20. Newlans' solution, in comparison, will have two parts (a programmable duplexer and wideband PA) that would be tunable to cover any band in the 700MHz-2700Mhz range. Gupta claimed the Newlans solution would reduce BOM costs by more than US$1 and reduce the FEM area by one-third. In addition, the power consumption would be in the range of 5mW.The company expects to have a prototype this summer and a working sample in the first half of 2014.If Newlans can deliver on its promise there is definitely customer interest but in the meanwhile other players in the market are addressing the same issue. On February 21, Qualcomm introduced its Qualcomm RF360 Front End Solution, which is designed to support all seven cellular modes (LTE-FDD, LTE-TDD, WCDMA, EV-DO, CDMA 1x, TD-SCDMA and GSM/EDGE). According to the company's press release the RF 360 has a dynamic antenna matching tuner, an integrated power amplifier-antenna switch, and a 3D-RF packaging solution incorporating key front end components. Qualcomm says its solution will reduce the RF front end footprint inside of a smartphone by up to 50%, while reducing complexity and development costs.Divi Gupta, COO NewlansPhoto: Michael McManus
Some market observers speculate TVs are increasingly becoming a thing of the past, as the use of devices such as tablets, smartphones computers and even Full HD projectors are becoming more integrated into consumers' everyday TV content viewing habits.The use of mobile devices to view TV programs or movies in mature economies such as the US has become an inseparable part of peoples' lives, and consumers there are even likely to view content with multiple devices, research firm Collective found in a recent study among US-based consumers. People seem to be on the go more than ever within the US and are seeking platforms that will give them an option to view their desired content wherever and whenever. But does this mean such consumers are willing to give up their larger-size viewing formats such as TVs?Global TV shipments are only expected to grow over 5% on year during 2013, down drastically from over 41% growth on year back in 2010, while tablet shipments may reach as high as 180 million units during the year, noted Digitimes Research. The TV growth is expected to come largely from emerging markets such as China, while tablet growth is expected to occur globally.The attitude from TV vendors, however, seems to be more optimistic, and the vendors feel there is a lot of potential for developing high-resolution smart TVs in mature economies. According to research firm IHS, more than one of every four TV sets shipped worldwide in 2012 was a smart TV, with the rapid sales growth of these Internet-connected sets paving the way for them to account for more than half of the market by 2015. These statistics seem to indicate that growth in the smart TV segment within mature economies at large will come from consumers who are looking to obtain the features they have on their mobile devices and view them on larger-screen formats. But will the TVs with such smart value-added features be enough? It seems there will have to be another factor pushing TV sales throughout 2013 and beyond - increased resolution.TV vendors are going to be heavily reliant on panel makers in the future to provide cutting-edge technology such as OLED and Ultra HD (4K or 3,840 by 2,160) panels that are affordably priced in order to draw consumers back to their living room viewing formats, as the ultra-high resolution viewing formats will be the TV's only other selling point aside from their increasingly larger sizes. Unfortunately though the panel makers are not expected to be able to drop the costs of those technologies similar to those of LCD for at least a couple of years, which will produce high costs for the TV vendors and thus most likely cause less-than-better TV sales throughout 2013. The TV vendors hope the panel makers can expedite the process for lowering technology costs, but this is an expensive burden the panel makers face and therefore TV vendors may not want to put all their eggs into one basket.TV vendors should start looking at how Sharp and Foxconn Electronics have begun forming alliances in order to keep down costs, stay competitive and have ample supply chain resources. The two companies also released their TV products in conjunction with some telecom providers in order to make up for lower prices, which have proven successful for them in that they were able to generate revenues.Additionally, and this may be a long shot, TV vendors may want to also consider whether they can use paper-thin flexible displays that have bendable features for their units in order to give consumers more portable options for the TVs. The screens themselves could act as solely a platform for viewing direct content via a portable set-top box (STB) that connects via a wireless Internet connection or could act as a screen in which the content is transmitted from consumers' portable devices, allowing the consumers to place their TVs in their desired place. If such possibilities are not considered, those weary TV market observers may be onto something and TV vendors may see unprecedented declines in sales in the future.
Although some upstream supply chain players do not think notebook ODMs should join the entry-level tablet competition because of profitability concerns, it seems a neccessary step that ODM must take in order to stay competitive in the PC market.For the ODMs, landing entry-level orders means a lot more than just revenues and profits; it is an important move to maintain their relationships with the brand partners.Since good relationships mean clients will continue releasing orders in the future, most ODMs are aggressively trying to get involved in the brand vendors' new projects. If the cooperation goes well, the ODMs will also receive orders for new products from the clients.The entry-level tablet orders can also help promote the ODMs' non-manufacturing business, such as Quanta Computer's cloud computing platform and Wistron's after-sales service.As more brand vendors will enter the entry-level tablet market in the future, the benefits from the slim-profit business will only grow stronger and send ODMs making even more aggressive moves.
Since Intel has opened up its fabs to other fabless IC firms, the Silicon Valley giant will pose a threat to TSMC at some point when it comes to high-volume orders, including future chip orders from Apple.TSMC will no longer be the sole supplier of Altera-designed chips. The FPGA vendor has announced plans to use Intel's 14nm FinFET process technology for the manufacture of its next-generation, high-performance product series.There is no doubt about Intel's manufacturing leadership, said Digitimes Research analyst Nobunaga Chai, when asked to comment on the just-announced partnership between Altera and Intel. Intel remains ahead of TSMC by 1-2 generations in technology, Chai added.Using Intel's 14m FinFET process will bring Altera's next-generation products more competitiveness against their counterparts provided by Xilinx, in terms of performance, Chai believes.However, making FPGAs is a lot different from producing application processors for mobile devices, Chai noted. The architecture of a FPGA does yield a high throughput while that of an AP doesn't, Chai continued. In other words, grabbing future chip orders from Altera should not be associated with a greater chance for Intel to land foundry orders for Apple's mobile devices, Chai said.From the lessons of cooperation with Samsung Electronics, Apple should find a number of reasons not to work with an IDM especially when the architecture it provides deliver better performance and power savings than that provided by the foundry partner, Chai pointed out. Nevertheless, another scenario is that Apple transitions its iPhones and iPads away from the ARM SoCs if Intel is able to provide more competitive solutions for mobile devices, Chai said.Intel can also utilize and extend further its relationship with memory chipmaker Micron Technology so that it stands a better chance of grabbing future chip orders from Apple, Chai suggested. The capability of manufacturing a single-chip integrated logic and memory device through 3D chip-stacking technology will be a competitive edge for Intel to win an Apple contract, Chai said.But for now, Chai reiterated his earlier prediction that TSMC is Apple's most-likely partner given that the pure-play foundry's manufacturing efficiency, flexibility and full support to co-work with.Chai said previously that TSMC with its 20nm SoC process would most likely secure its first chip orders from Apple, and the foundry's 16nm FinFET process would play a key role in Apple's "breakthrough" product.technology.
