Asustek Computer Inc’s (華碩) equity investment in a local networking equipment maker could provide the netbook computer pioneer a stepping stone to produce consumer networking devices, analysts said, although the company said the investment was purely financial.
Speculation abounded late last week about the real intentions behind Asustek’s equity investment in D-Link Corp (友訊) after the company had reportedly accrued a 4.27 percent stake late last year.
At first glance, the two companies bear no resemblance because Neihu-based Asustek’s core business is making computer motherboards, laptops, computer peripherals and handheld devices, while Hsinchu-based D-Link specializes in networking and communications, producing network hardware for consumers and small to medium-sized businesses.
However, because companies such as Sony Corp, Microsoft Corp and Acer Inc (宏碁) have envisioned a world of full connectivity between various electronic devices, “it is not difficult to see a possible collaboration between Asustek and D-Link in the near future as the two companies work on the technical details to connect all digital devices,” John Cheng (鄭若望), an analyst at International Data Corp’s Taipei branch, told the Taipei Times by telephone on Friday.
In 2005, when Asustek acquired shares of Askey Computer Corp (亞旭), a wireless local-area-network (LAN) equipment maker, analysts said the deal would be Asustek’s first foray into networking equipment and wireless communications.
Last month, Asustek chairman Jonney Shih (施崇棠) said during the Computex trade show that his grand plan was to create a complete “digital home,” where TVs, mobile handsets, navigation systems and personal computers could “talk” to each other and deliver all forms of digital content.
“The ability of devices to talk to each other is the whole concept behind wireless LAN,” Cheng said. “Plugging wireless adapters or switch routers into TVs, game consoles or stereo equipment will allow them to connect via radio frequency, and switch routers are exactly the type of business D-Link is in.”
D-Link has become a household name in WiFi or wireless LAN products worldwide.
Its main competitors include Cisco Systems Inc of the US and Huawei Technologies Co (華為) of China.
In recent years, in the face of fierce competition in supplying networking devices to telecoms operators, the company has gradually increased its focus on retail consumers in collaboration with PC vendors.
“D-Link’s products have accounted for roughly 22 percent in global markets. This part, if [Asustek] wants to move to the network communications industry, I think it should be one point for consideration,” Topology Research Institute (拓墣產業研究所) analyst Kelly Hsieh (謝雨珊) told the local cable TV station USTV on Friday.
Another analyst, however, thinks the odds for a potential partnership between the two companies are low.
“Asustek already does a very good job of enabling 802.11n WiFi and Bluetooth on its computers. I really cannot come up with ideas for potential strategic partnership between the two,” Helen Chiang (江芳韻), a PC and peripherals research manager at IDC, said on Friday by telephone.
The D-Link share purchase took place at the end of last year, with Asustek saying it had earlier disclosed the deal to the public and that it was never a secret from investors.
In a stock exchange filing on Friday, Asustek said the company and its venture capital unit, Asustek Holdings Ltd (華誠創投), had bought D-Link shares on the open market “during the fourth quarter of last year” on consideration of “short-term efficiency of capital utilization.”
“The D-Link holding is purely for investment purchases. It has no other objectives,” Nick Wu (吳長榮), deputy director at Asustek’s finance and accounting division, said by telephone.
Wu said there has been no trading in D-Link shares since then and the company had no intention to buy more D-Link shares.
Asustek also holds United Microelectronics Corp (聯電) shares in its stock portfolio, Wu said.
The company has held the world’s second-biggest contract chipmaker’s shares for at least 10 years, also for financial purpose, he said.
Asustek shares have risen 26.9 percent so far this year and closed at NT$46.7 on Friday, while those of D-Link have increased 22 percent to NT$28, Taiwan Stock Exchange data showed.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday obtained the government’s approval to inject an additional US$7.5 billion into its US subsidiary, the Department of Investment Review said in a statement. The department approved TSMC’s application of investing in TSMC Arizona Corp, which is engaged in the manufacturing, sales, testing and design of IC and other semiconductor devices, it said. The latest capital injection follows a US$5 billion investment for TSMC Arizona approved in June. The chipmaker has broken ground on two advanced fabs in Arizona with aggregated investments approved by the department totaling US$24 billion thus far. According to TSMC, the first Arizona
The lethal hack of Hezbollah’s Asian-branded pagers and walkie-talkies has sparked an intense search for the devices’ path, revealing a murky market for older technologies where buyers might have few assurances about what they are getting. While supply chains and distribution channels for higher-margin and newer products are tightly managed, that is not the case for older electronics from Asia where counterfeiting, surplus inventories and complex contract manufacturing deals can sometimes make it impossible to identify the source of a product, analysts and consultants say. The response from the companies at the center of the booby-trapped gadgets that killed 37
FRIENDLY TAKEOVER: While Qualcomm Inc’s proposal to buy some or all of Intel raises the prospect of other competitors, Broadcom Inc is staying on the sidelines Qualcomm Inc has approached Intel Corp to discuss a potential acquisition of the struggling chipmaker, people with knowledge of the matter said, raising the prospect of one of the biggest-ever merger and acquisition deals. California-based Qualcomm proposed a friendly takeover for Intel in recent days, said the sources, who asked not to be identified discussing confidential information. The proposal is for all of the chipmaker, although Qualcomm has not ruled out buying some parts of Intel and selling off others. It is uncertain whether the initial approach would lead to an agreement and any deal is likely to come under close antitrust scrutiny
SECURITY CONCERNS: The proposed ban on Chinese autonomous vehicle software and hardware would go into effect with the 2027 and 2030 model years respectively The US Department of Commerce today is expected to propose prohibiting Chinese software and hardware in connected and autonomous vehicles on US roads due to national security concerns, two sources said. US President Joe Biden’s administration has raised concerns about the collection of data by Chinese companies on US drivers and infrastructure as well as the potential foreign manipulation of vehicles connected to the Internet and navigation systems. The proposed regulation would ban the import and sale of vehicles from China with key communications or automated driving system software or hardware, said the two sources, who declined to be identified because the