In something of a shock admission, ZTE's VP for wireless technology & strategy, Donglin Shen, admitted that his company has well developed plans to produce its own chipsets for LTE – the 4G standard.
ZTE has designed its own ICs before but this represents something of a major leap.
The company is a major customer of Qualcomm – using the latter's cellular chipsets extensively in its wide range of mobile handsets and USB modems.
In fact, Qualcomm should be able to start commercial shipments of its LTE chips next month (December 2009). Mr Shen estimates that it will only take his company a few months to create ZTE's first LTE product using Qualcomm's products.
That product will be an LTE adapter for portable computers which almost certainly will take the form of an internal PCI Express modem. The power drain would be too high if ZTE went straight to a USB dongle.
Significantly, Shen gave no indication of how soon he expect ZTE to have its own LTE chips.
This move will effectively put ZTE directly head to head with Qualcomm over LTE chipsets. Mr Shen made it very clear that he didn't expect the development to damage the company's realtionship with Qualcomm.
There's no suggestion, for example, that ZTE might make its own LTE chipsets available to other suppliers of 4G dongles and handsets. Mr Shen indicated that he didn't expect ZTE to supply its first LTE handset until at least 12 months after it delivers its first 4G modem. That would place it somewhere in the region of Q1 2011.