A number of handset-design companies in China have been forced to either suspend or trim down their operations due to slack business resulting from keen competition, according to industry sources.
TechFaith Wireless Communication Technology has reportedly reduced its workforce from 1,300 to 300, and Shanghai Simcom, a subsidiary of SIM Technology, has trimmed down the size of its TD-SCDMA unit, the sources indicated.
TechFaith has actually cut off its GSM unit following the massive layoffs and has switched its focus mainly to the development of 3G handsets, the sources noted.
Gilbert Lee, CEO of TechFaith, while confirming that the company has laid off a part of its workforce, said that the extent of layoffs is not as large as has reported, and also insisted that the action was part of cost-down measures.
In addition to 3G models, TechFaith has also entered the development of Windows Mobile-based smartphones, MID (Mobile Internet Device) products and 3.5G data cards, according to market sources.
The availability of low-cost handset platforms from Taiwan-based MediaTek has caused a proliferation of small-scale handset-design companies in China, which have little differentiation in product designs, pointed out the market sources.
Source:DIGITIMES
