TAIPEI/BEIJING, April 14 (Reuters) - Dell DELL.O, the world's No.2 PC brand, plans to enter the lucrative but crowded smartphone market by the year-end with an initial rollout in China as it looks for new revenue sources, two analysts said on Tuesday.
The analysts, speaking on condition of anonymity because Dell has not confirmed the plan, said Dell is working on handsets with Chi Mei Communications, an unlisted subsidiary of Taiwan electronics giant Hon Hai (2317.TW), while China-based software designer Red Office is designing the phones' operating system.
Spokesmen from Hon Hai's office in Taiwan and Dell offices in China and Singapore had no comment, but a Red Office spokeswoman confirmed her company was developing an operating system for a smartphone for Dell.
The two analysts said they verified the news with officials at Chi Mei, which already counts Dell as a client.
They could not provide details on what mobile carrier in China would offer the phones. But they said the roll-out would occur first in that country, the world's largest cellular market by subscribers, followed by the United States and Europe.
Dell's move comes as many of its peers, including Acer (2353.TW) and Asustek (2357.TW), enter the increasingly competitive smartphone market, going head to head with established brands such as Apple (AAPL.O), Nokia NOK1V.HE, HTC (2498.TW) and Research in Motion RIM.TO, maker of the BlackBerry.
Smartphones are feature-packed phones that combine many computer functions with traditional handsets in what some are calling a convergence between the two products. (Reporting by Kelvin Soh and Michael Wei; Editing by Doug Young and Lincoln Feast)