Broadcom reportedly plans to call it quits from the chip market for TVs and Blu-ray players due to low gross margins and return on equity (ROE) generated from the product lines – a move which is likely to benefit Taiwan-based IC design houses MediaTek and MStar Semiconductor, according to industry sources in Taiwan.

Since Broadcom has been bundling the sale of its TV and Blu-ray chips, MediaTek will benefit most from Broadcon's possible move as the local handset solution vendor also produces chips for TVs and Blu-ray players, the sources noted.

MStar may benefit less than MediaTek if Broadcom withdraws from the TV and Blu-ray chip markets as the company currently focuses mainly on solutions for handsets, TVs and set-top boxes (STBs).

Broadcom is also one of the top vendors for STB chips globally, and it remains to be seen if the company will also withdraw from the STB chip market, the sources said.