Taipei, London: MediaTek Inc. released software tools to help make home appliances and garage doors controllable through Apple Inc.’s iPhones as the chipmaker taps the burgeoning market for internet-connected homes.
Development kits for Apple’s HomeKit platform will help electronics makers integrate MediaTek processors into their smart appliances, the Taiwanese company said in a statement Wednesday.
MediaTek, which competes with Qualcomm Inc. to supply the chips that power smartphones, is facing declining sales amid a weakening mobile device market and stiffer competition. MediaTek’s plans for broadening its revenue base include a bid for Taiwanese chip designer Richtek Technology Corp. and investments in companies such as People Power Co. that focus on the so-called internet of Things.
“The biggest opportunity is still the mobile business, but mobile will ultimately become stagnant,” Jeffrey Ju, vice president of MediaTek’s wireless communication group, said in an interview in London. “In this industry, we think about the internet of things — whether it’s smart home, wearables — for semiconductors, that’s next.”
Once the world’s largest maker of DVD chips, MediaTek displaced Qualcomm to land orders to supply chips for Amazon.com Inc.’s Fire TV box, which will be released next week.
Apple unveiled HomeKit last year as a platform for iPhones and iPads to connect with accessories in the home, allowing hardware and app developers to turn those mobile devices into controllers of tea kettles, thermostats and even window shades. More than 29 billion devices will be connected to the internet by 2020 for a total market size of $1.7 trillion, according to researcher IDC.
“It’s not really about the devices it’s about getting the system to work,” Chief Marketing Officer Johan Lodenius said in a separate interview. “We have to make it easier to use. It has to be very intuitive.”
Meanwhile, the company is betting on support from local smartphone makers to help it stand up to Qualcomm Inc. in the Indian market, where handset sales are expected to grow at three or four times the rate of the rest of the world over the next few years.
MediaTek has been supporting smaller Indian phone makers, such as Micromax Informatics Ltd, that have grown up around the smartphone boom in the country, offering older technology for cheaper phones and helping those companies develop more advanced models as they’ve grown.
“Probably 50 per cent or more of the Indian handset market is now Indian brands,” Finbarr Moynihan, general manager of international sales at MediaTek, said at an event in London Wednesday. “We can cover all their needs.”
While smartphone sales in India accelerate, deliveries in the rest of the world, including China are stagnating. The Indian market could see shipments increase by 15 per cent in the next few years as the global market grows by 5 per cent, Moynihan said. San Diego-based Qualcomm is increasing its local investment, and this week said it will put $150 million into start-ups in India. Earlier this month, MediaTek said its staff in India will double to 400 by the end of this year and reach 700 by the end of 2016.
The next high-growth markets could be in Africa, where Hsinchu, Taiwan-based MediaTek is taking a similar tack, targeting local brands that compete successfully alongside companies like Samsung Electronics Co.
“These brands are so well known in the local markets, local brands, African brands are becoming stronger and growing,” Moynihan said.
To contact the reporter on this story: Amy Thomson in London at athomson6@bloomberg.net To contact the editors responsible for this story: Kenneth Wong at kwong11@bloomberg.net Kim McLaughlin, Robert Fenner
