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Broadcom's Solution for Nintendo

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Leading chipmaker Broadcom Corporation recently declared the inclusion of its latest wireless connectivity platform in Nintendo’s Wii U gaming portal. The new gaming process is created particularly for integrating Wi-Fi, Bluetooth and Near Field Communications (NFC) process.

The company in association with Nintendo has designed advanced 5 GHz Wi-Fi techniques which will be primarily used for controlling low-latency video and supporting audio transmission among the Wii U console and its controller. Broadcom's NFC system will provide an advanced, integrated and secured gaming platform for GamePad. Moreover, with the help of the Bluetooth 4.0 services, the latest gaming system can be used with various legacy games and legacy peripherals. The integration of Wi-Fi, Bluetooth and NFC in the new Wii U gaming process will usher in a new age for video game.

Broadcom’s customized solutions would surely mitigate the increasing demand in the industry and also help Nintendo improve its entire wireless gaming services, thus enhancing its business.

Management expressed its optimism on the association by stating that Nintendo’s continuous efforts in providing the best in class gaming services has helped it secure a substantial market share in the industry. The company is looking forward to extending its coverage in consumer electronics industry and further strengthening Nintendo’s position through providing the latest wireless techniques.

Broadcom is well placed in the fast-growing wired and wireless communications markets, with cutting-edge solutions for a growing number of connected users, who are demanding more content and bandwidth. The market for wireless connectivity devices is expected to grow, driven by increasing demand of smartphones, tablets, netbooks and digital TVs.

The company currently faces ominous competition from a number of major players of the industry like QUALCOMM Incorporated (QCOM - Free Report) and Skyworks Solutions Inc. (SWKS - Free Report) . QUALCOMM’s operating unit, Qualcomm Technologies, Inc. (QTI) recently completed the acquisition of EPOS Development, Ltd. (EPOS). In order to retain its position in the global market, it is imperative that Broadcom continues to make various momentous undertakings and develop new products, keeping in mind the betterment of the organization in both the long and short run.

For Broadcom the current Zacks Consensus Estimate for the fourth quarter of 2012 is 49 cents, reflecting a year-over-year growth of 8.1%. Estimates for 2012 and 2013 are $1.97 and $2.04, representing annual growth of 7.2% and 3.6%, respectively. We currently maintain a ‘Hold’ recommendation on Broadcom. The stock carries a Zacks #3 Rank, translating into a short-term (1-3 months) ‘Hold’ rating.

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