PMC-Sierra targets mainland

Communications semiconductor-maker PMC-Sierra, weighed down by sluggish demand worldwide, is looking to get a big boost from China as it supplies chips to the mainland's top networking gear manufacturers.

Doug Brownridge, PMC-Sierra's vice-president of corporate marketing, said the company was keen on driving sales beyond its main North America-based clients Cisco Systems, Lucent Technologies and Nortel Networks to fast-growing Chinese companies ZTE and Huawei Technologies.

'With our focus on advanced networking and communications technologies, we expect to engage both ZTE and Huawei in strategic supply deals that will help them grow their business in the mainland and in other markets around the world,' he said.

Research firm Gartner sees the timing as right to cash in on China's booming telecommunications and electronics industries. Gartner senior analyst Dorothy Lai said component suppliers with proven products should now take advantage of growing demand from Chinese manufacturers.

According to Gartner unit Dataquest, the market for optical transmission gear in the mainland grew 27.3 per cent last year. This helped the overall Asia-Pacific market for these optical systems, which power the high-speed data capabilities of metropolitan-area communications networks, to increase 18.8 per cent last year compared with significantly lower equipment demand from North America and Western Europe.

The worldwide optical transmission gear market is forecast to achieve US$32.6 billion in sales this year, up from US$30.3 billion last year. Next year, the market is expected to reach US$36 billion.

Dataquest senior analyst Peter Kjeldsen said: 'The Chinese market is the obvious attraction right now. But because it is so obvious an opportunity, many players will try to address this market, so the competition will heat up.'