Broadcom Gains Ground In The GPS Chip Market

Infineon countered with its new Xposys GPS chip, which is rated at an industry-leading sensitivity of –165 dBm. Built in 65 nm, Xposys offers a smaller solution size than the BCM4750 and even lower power consumption: just 11 mW when tracking at one sample per second. Apple, however, was concerned that Xposys had not been deployed in the field. Once again, it chose the proven solution, this time from Broadcom. Apple also chose Broadcom for the GPS chip in the iPad.

Apple’s choices drive tremendous volume. We forecast that Apple will build about 35 million iPhone 4s this year (including some that will ship in 2011) and 5 million cellular iPads. (The non-cellular version does not have GPS.)

We also estimate Broadcom’s share of the GPS chip market will jump from just 6% in 2009 to 24% this year and 35% in 2011, making it the leading vendor of GPS chips at that time (see the figure). Broadcom could gain further share if Apple adds GPS to the new iPod Touch in September.

With the loss of its biggest (by far) customer, Infineon will see its GPS market share drop from 17% in 2009 to an estimated 2% in 2011, assuming it does not add any big new customers before then. With many handset makers shifting to integrated devices that combine GPS with Bluetooth and other functions, such large design wins are quickly disappearing.

Broadcom Does It Again
Broadcom’s track record with new technologies is simply amazing. The company entered the Ethernet market in 1999, introduced the industry’s first Gigabit Ethernet chip in 2000, and quickly became the number-one supplier of Ethernet chips. Broadcom deployed the industry’s first 802.11g chip in 2002 and went on to become the leading Wi-Fi chip supplier. More recently, the company became the leading supplier of DSL chips in 2008 and the leading supplier of switch-fabric chips in 2009. It is also the leader in mobile Wi-Fi and in Bluetooth combo chips.

Broadcom succeeds by introducing leading-edge technology at a steady pace. It also focuses on top customers, such as TomTom in PNDs and Apple in smart phones, working relentlessly to win their business. This recipe for success seems simple, but if it were, other companies would be following in Broadcom’s footsteps.

LINLEY GWENNAP is the founder and principal analyst of the Linley Group and coauthor of A Guide to Mobile Connectivity Chips and A Guide to Mobile Processors.