Taiwan-based handset ODMs and brand vendors are expected to see their combined handset shipments grow over 40% on quarter and also on year to a total of 23.4 million units in the second quarter of 2014, according to Digitimes Research.ODMs, including Arima Communications, Chi Mei Communication Systems (CMCS) and Compal Communications will see their shipments grow 20-35% sequentially each thanks to smartphone orders from Sony Mobile Communications and feature phone orders from Nokia, Digitimes Research said.Brand vendor HTC is expected to double its shipments in the second quarter as compared to the previous quarter, buoyed by strong sales of its new flagship model the HTC One (M8) and the mid-range Desire 816.Overall smartphone shipments from Taiwan makers are likely to grow over 40% sequentially in the second quarter.Additionally, Asustek Computer is expected to ship 650,000 units of its Zenfone smartphones in the second quarter of 2014, making it the fifth largest local handset shipper in Taiwan. But it remains to be seen whether Asustek can maintain its shipment momentum, Digitimes Research commented.

Taiwan panel makers' shipments of large-size (9-inch and above) TFT LCD panels are expected to reach 64.95 million units in the second quarter of 2014, up 4.4% on quarter but down on year, according to Digitimes Research.Taiwan's shipments of TV panels in particular were down in the first quarter due to the off season as well as to China-based TV vendors decreasing reserves. Taiwan makers also reduced 32-inch LCD TV panel production. Heading into the second quarter, however, the makers are seeing demand rise due to China's May 1 holiday period, with Innolux expected to see a 50% sequential rise in Ultra HD TV panels.Digitimes Research said Taiwan makers' on-year decline in the second quarter is expected to come as their shipments of LCD monitor and notebook panels decline.In terms of on-quarter performance in the second quarter, Taiwan makers' shipments of TV, monitor, notebook and tablet applications are expected to rise 8.9%, 3.8%, 1.3% and 5.9% respectively, added Digitimes Research.

Taiwan-based ODMs Ability Enterprise, Altek, Asia Optical and Foxconn Electronics will ship 2.703 million digital cameras in total in the second quarter of 2014, increasing 14.2% on quarter but decreasing 53.5% on year, according to Digitimes Research.Ability Enterprise will account for 73% of the shipments, Altek for 24.3%, Asia Optical for 2% and Foxconn for 0.7%, Digitimes Research indicates in its latetest Taiwan DSC quarterly report.Nikon will be the largest client accounting for 50.7% of the shipments, followed by Casio with 11.2%, Fujifilm with 10.8%, Sony with 10.8%, Samsung Electronics with 9.8%, Panasonic with 2.8% and Olympus with 0.7%.

Taiwan and worldwide notebook shipments dropped 13.8% and 14.2% sequentially, and 6.8% and 5.5% on year, respectively in the first quarter of 2014, according to Digitimes Research's latest figures. The sequential drops were mainly due to seasonality.Although the on-year declines were the slowest compared to those in the past five quarters, whether the notebook market has already started recovering remains to be seen.Hewlett-Packard (HP), Asustek Computer, Apple and Lenovo all achieved on-year growths in their first-quarter notebook shipments with the first three seeing growths of more than 10%, according to the latest quarterly notebook report by Digitimes Research.Acer, Samsung Electronics and Sony suffered on-year shipment declines higher than the market average in the first quarter. Acer has been restructuring its business, while Samsung and Sony have shifted their focuses away from the notebook market.The top-5 notebook ODMs' combined shipment performance was weaker than that of the overall industry. Foxconn Electronics (Hon Hai Precision Industry), which landed orders for HP's educational procurement products, became the largest notebook supplier of HP in the first quarter with shipments growing over 100% to reach two million units.

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.