CSR says its market share growing

PARIS (Reuters) - British-based Bluetooth specialist CSR Plc (CSR.L) said on Monday it continued to maintain or grow its unit market share despite rivals making inroads into its market and saw music players as the next big growth opportunity.

"We are in all likelihood holding or gaining unit market share. I don't think there is any evidence that we are losing market share. We are probably gaining market share in every sector," CSR Chief Executive John Scarisbrick said at the Reuters Global Technology, Media and Telecoms Summit in Paris.

CSR shares jumped as much as 3.35 percent on the news. They ended the day 2 percent higher at 791 pence.

Rivals, notably U.S.-based chip designer Broadcom (BRCM.O), have been making inroads into CSR's niche market, prompting fears its historically high market share in the Bluetooth space could decline.

CSR, the market leader in chips and devices using Bluetooth -- the short-range wireless link that transfers data between mobiles, computers and accessories -- said its niche market was far from maturing, with the technology finding its way into devices beyond its core markets of mobile phones and headsets.

Scarisbrick said MP3 players were likely to be the next big boom area for Bluetooth adoption in 2007, with growth here set to follow the "ballistic" trend seen in mobiles.

"MP3 players will be a significant part of the growth this year and beyond. It will be substantial. It is happening this year in terms of millions of units, it will continue to grow over three, four, five years," he said.

CSR, a supplier of Bluetooth chips for Samsung(005930.KS) music players, declined to comment when asked if MP3 market leader Apple's (AAPL.O) iPod was planning to incorporate Bluetooth and if CSR would be a supplier.

Scarisbrick said Bluetooth adoption had a long way to go even in mobile phones, with attach rates of Bluetooth chips only set to rise to 40-50 percent in phones in 2007.

"It will likely rise well above that in five years," he said.

CSR expects satellite navigation in mobile phones will be another "killer application" in coming years as chipsets become cheaper and less power-hungry.

"I think GPS (global positioning system) will climb really steeply because it's actually a bargain," said Scarisbrick.

CSR earlier this year bought GPS specialists Sweden's NordNav and Cambridge Positioning Systems for $75 million. It says it can deliver GPS for a little more than a $1 extra.

GPS chips are currently used in high-end phones, and Scarisbrick said the adoption had been held back until now by a design derived from portable navigation systems for cars, where power consumption was not an issue.

"The technology is there now. Before it's in the hands of consumers, it will be 2008, and it will be significant in 2009," he said, adding that he expected adoption would rise quickly.

"You could see it (GPS) getting half the Bluetooth attach rate in 2009," he said.

The chief executive of Dutch car navigation device maker TomTom (TOM2.AS), Harold Goddijn, told Reuters last month that it was actively looking at the handset business.

Goddijn said mobile phones would not replace dedicated car navigation devices because the user experience was different, but added GPS-enabled phones could be useful for pedestrians or when combined with real-time traffic information.

(Additional reporting by Niclas Mika