Boston, MA - December 6, 2005 -- RF Micro Devices, the leading cellular handset power amplifier vendor, recently revealed to Strategy Analytics details of its plan to combat the marginalization of the Power Amplifier (PA), as described in the Strategy Analytics report, "Quest for Profitability Leads RF Micro Devices Away from GaAs." With 44 percent of the PA market, RF Micro Devices, proposes following a bold path to analog integration that will lead to a single chip comprising complete front end radios with filters, PAs, switches, power management and transceivers.

Even with the introduction of more complex, front end power amplifier modules, prices have continued to drop, leaving PA vendors to struggle to improve margins and maintain profits. In contrast, advances in mixed signal integrated circuits have made the baseband the heart and the most profitable part of the handset, with transceivers running second.

"The RF Micro Devices argument makes sense, betting that separating most of the digital and analog functions into two different chips will allow separate process and design optimization for each," notes Chris Taylor, Director of the Strategy Analytics RF & Wireless Components service. "In contrast, the baseband and transceiver companies are relying on their experience in bulk CMOS to offer integrated solutions that combine both digital and analog functions, although this involves performance trade-offs."

"We applaud the breadth and coherence outlined by RF Micro Devices in its plan to make its strategic roadmap a reality," comments Stephen Entwistle, Vice President, Strategic Technologies Practice. "This strategy has the potential to force weaker players out of the market, which will have a positive impact on profit margins for those strong enough to lead."