STMicro ramps up Wi-Fi phone chip

STMicroelectronics is mass producing its first wireless LAN chip for cellular phones, a component for an emerging technology expected to take hold.

STMicroelectronics NV has begun mass production of its first cellular-phone wireless LAN chip, a new component expected to become standard as wireless network coverage becomes more pervasive.

The company said its STLC4370 chip, based on 802.11g technology, provides power-efficient, high-speed wireless performance. The chip's compact design lets it fit into devices of different shapes and types, including the candy bar-style, compact PDAs and fold-open keyboard designs, STMicro said.

The chip has been included in the design of several recently launched Wi-Fi cellular handsets, but STMicroelectronics did not specify the manufacturers. The chip costs US$10 in quantities of 100,000 units, the company said.

In the first quarter of this year, STMicro will release two more chips in the same family using the 802.11b/g and 802.11a/b/g specifications. Second-generation versions of the chip will go into production around the end of second quarter, and those will be smaller, said Edoardo Merli, STMicro deputy general manager for the wireless LAN business unit.

Hurdles for wireless LAN chips in phones have been battery life and chips' cost and size.

Chip and device manufacturers are heavily focused on wireless LAN chips for cellular phones, said Ellen Daley, a Forrester Research analyst. Devices such as the BlackBerry 7270 from Research in Motion and Motorola's CN620 are dual-mode, meaning they can handle both cellular and Wi-Fi signals.

Dual-mode devices are in demand by companies surveyed by Forrester, Daley said. They hope the technology can save on cellular phone bills by using VoIP (voice over Internet Protocol) over wireless LAN, she said.

But technological barriers remain, as VoIP over wireless LAN is still in its early stages and coverage from Wi-Fi networks is far from ubiquitous, she said. Telecomunication providers are cautiously pondering whether to support dual-mode devices that could also potentially cannibalize their revenue, she said.

"We are anticipating that market to really heat up a lot more in 2007," Daley said.

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