The mobile handset outsourcing landscape

This document describes the handset industry players – component vendors, contract manufacturers, original design manufacturers, OEMs – and explores the shifting roles and relationships between them. Focus is given to ODMs and brands of mobile devices, with particular attention to design models between them. A relationship map represents the industry’s outsourcing structure, seeking to identify trends and patterns between successful firms’ performances and their partners. Handset designs originate largely from OEMs and ODMs, but innovative firms also gravitate towards certain design flow models. The commoditization of mature technologies and basic reference designs further allows new entrants to develop products with relative ease, creating complementary assets as prized core competencies: OEMs developing key design and feature innovations in-house are found to enjoy stronger brand value, better global sales, and higher profits. ODMs taking their own design lead also rank higher in shipment volumes than those mainly manufacturing client designs.