Fabless semiconductor company Broadcom is looking to phase-out its Wi-Fi chip-making business, according to industry sources who spoke with Taiwanese trade publication DigiTimes. Broadcom is currently Apple’s top supplier of Wi-Fi chips used in Macs, iPhones, iPads and iPods so it looks like the Cupertino firm might be forced to find a new supplier soon.
Broadcom designs its own products but contracts out actual silicon production to Taiwan Semiconductor Manufacturing Company Limited (TSMC), which also builds Apple-designed application processors for iOS devices.
Broadcom is said to be scaling back production of Wi-Fi chips as a result of workforce and product streamlining following its acquisition by Arago Technologies.
“Broadcom has moved to significantly reduce resources allocated to its Wi-Fi chip business, which yields relatively low gross margins compared to other product lines due to fierce price competition in the market for mass-market applications such as notebooks, tablets, TVs and smartphones,” reads the report.
Though the firm has already halved the workforce at its Taipei plant, MediaTek, Realtek Semiconductor and RDA Microelectronics have already received a pull-in of short lead-time orders from Broadcom’s customers in the Wi-Fi chip sector.
Photo top of post courtesy of iFixit.