US giant's rejection of China's standard leaves door open for other chipmakers
A lengthy trade crisis over China's wireless local area network (WLAN) encryption standard may benefit the information technology rivals of Intel and other firms adversely affected by the mainland policy, industry experts say.
Analysts at research firm Gartner said Intel's recent decision not to comply with the mainland's WLAN Authentication and Privacy Infrastructure (Wapi) encryption system had provided an opening for chipmakers such as Taiwan's Via Technologies and United States-based Advanced Micro Devices (AMD) and Transmeta to seize some market share in China from the semiconductor giant.
'If the Chinese government insists on forcing the Wapi standard and Intel cannot follow, we believe that Intel will face tough competition from those microprocessor vendors,' Gartner Hong Kong principal analyst Dorothy Lai said.
The Wapi encryption standard is supposed to resolve inherent security problems with high-speed internet access using Wi-fi technology. Intel's Centrino chip system has been integrated into many notebook computers to enable Wi-fi connection. Wapi is not compatible with the international WLAN standards that Centrino supports.
Annie Cheung, Gartner Hong Kong principal analyst for computer hardware and systems, estimated that more than 1.7 million notebook computers were sold in China last year, which made up 36.8 per cent of the total Asia-Pacific notebook market. In the quarter to December last year, about 50 per cent of notebooks sold in China were Centrino-equipped.
Ms Lai said: 'If PC makers need to go back to using two chips - one for processing and another for WLAN function - for their notebook computers, there is a chance for mobile processor makers such as AMD, Transmeta and Via to gain market share in this area.