Consolidation is ahead for the wireless semiconductor sector, according to the chief executive of chip maker Broadcom Corp. (BRCM), with many companies likely to face either a financial or technological squeeze.
Scott McGregor, speaking at an investor conference, said the high cost and difficulty of developing new processors for smartphones and tablet computers will cause many chip makers to exit the market.
He said companies fall into one of four categories–those that have the money and technology to create products, those that have the technical capability but don’t have the cash, those that have a lot of money but not a lot of technology, and startups or companies without much scale. McGregor said he believes there are only about a handful of companies that can offer a complete product to customers.
“Some people are going to give up, some people will sell out and some people will continue to push forward,” he said.