Ericsson and STMicro Joint Venture looks Positive

Posted by Kallan Dahn Wednesday, August 20, 2008

It looks like there is about to be a new wireless focused chip manufacturer on the block soon. Ericsson and STMircro have come to an agreement to merge their business into one entity. Ericsson has primarily been focused on software, while STMicro has focused on chip production. The new entity will compete directly with companies like Qualcomm, and Texas Instrument. This new joint venture will supply all major handset manufacturers in the world, except Motorola. This newly formed company will supply chips for 3G as well as hotly anticipated 4G products such as LTE. This should help Ericsson significantly by aligning a strategic relationship with a chip manufacturer. In turn, we should see a rather large increase in the expected shipment of software in subsequent quarters provided the newly formed company has all the hiccups worked out before showtime.

{Reuters}









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