LONDON (WiMAX Day). Earlier this week, Motorola announced that it would expand its already strong relationship with chip manufacturer Texas Instruments in the development of the first mobile WiMAX handsets from Motorola, focussed on “802.16e mobile WiMAX functionality supporting voice, video and data for low-power mobile applications.”

A joint press release issued by the companies stated that Texas Instruments will support “Motorola’s mobile WiMAX initiative, including development of a customised Motorola WiMAX solution, and providing digital design elements, high-performance analogue components, RF solutions, and manufacturing process and fabrication expertise.” It was further noted that Texas Instruments solutions would support the production of new mobile devices that Motorola plans to launch in 2008.

Significant competition
Motorola shipped 217 million mobile telephones last year, giving it a total overall market share of 21 percent of the one billion phones shipped in 2006. While Motorola trails behind Nokia in market share, the company may be in a position to garner a significant portion of the WiMAX handset market.

Nokia, the leading mobile handset manufacturer with 34 percent market share, has only recently entered into the WiMAX arena, also as a partner in the Sprint ecosystem. However Nokia reportedly has been slow on development of WiMAX intelligence, and may very well need to make some acquisitions to speed its development.

Most analysts agree that because Samsung developed WiMAX handsets early, and was instrumental in the launch of WiBro last year, it may be in a position to lead the market. Samsung has also committed $320 million to R&D for WiMAX products.

There still may be other competitors in the mobile WiMAX market. With six percent of the mobile handset market in 2006, LG Electronics is hoping to get in early on WiMAX as well. Sony Ericsson, with a seven percent market share, is one major player that has not made any announcement of producing handsets for mobile WiMAX.

Chipset delays
Part of the supply quandary for mobile WiMAX handsets is the availability of 802.16e WiMAX chipsets. Until manufacturers can start producing this silicon en masse, there will be a dirth of handsets on the market until 2009.

Both Samsung and LG are producing their own chips for WiBro and reportedly will do the same for WiMAX. Intel and LG are working together on WiBro/WiMAX chips, as is Nortel with LG, and an Intel/Nokia partnership was announced two years ago. The California chip designer TeleCIS Wireless has reported strategic alliances with Samsung as well, and last year Motorola Ventures invested in the French chip-maker Sequans.

Yet all of this activity does not necessarily mean the manufacturers are anywhere near fulfilling the demand for WiMAX silicon.

Market potential
The announcement from Motorola indicates its commitment to supply handsets for mobile WiMAX in the next year, yet it is not clear how many of these handsets Motorola might be able to deliver, and moreover, how many of them Motorola will supply outside of America, where it has a principal supply agreement with Sprint Nextel.

Estimates for the supply of mobile WiMAX handsets vary, however many agree that 32 million shipped units by 2011 is a fair estimate, and one that was cited by Kitae Lee, President of Samsung’s Telecommunication Network Business.

Sadly, the mobile handset industry moves painfully slow, and according to an analyst at JP Morgan, delays in new handset deliveries generally run 18-24 months behind schedule. Some observers have noted that handsets for mobile WiMAX may suffer the same year-on-year shipment delays that stymied the delivery of 3G handsets, whilst others argue that WiMAX technology is far less complicated and more easy to engineer.

Regardless of manufacturer delays, and notwithstanding the limitations in chipset supply, if the “start-up” handset manufacturer Apple meets its stated goal of shipping 10 million (non-WiMAX) iPhones by 2008 and more than 60 million by end of the decade, one would hope that the top three mobile handset manufacturers could together ship at least that amount for mobile WiMAX by 2010.