Due to falling shipments of MediaTek handset chips in the fourth quarter of 2007, chip makers have been conservative about demand for handsets in the China market. However, industry sources recently noted that Nokia expects demand for handsets in the China market to increase about 15% this year, and that handset makers have not faced any inventory problems.

While heavy snowfall in late January did postpone handset demand partially, it also made consumers realize the importance of handsets, which should help contribute to increased shipments, China handset makers pointed out.

Demand for handsets in China totaled 250 million units in 2007, the sources indicated, making China's handset market the second largest in size after the US market.

IC design houses such as MediaTek, Elan Microelectronics, Richtek Technology, Global Media Technology, and Pixart Imaging would benefit from growing demand for handsets in the China market.

Meanwhile China's white-box handset makers are also determined to increase exports, and an increasing number of makers are already enjoying strong sales performance in Southeast Asia.