MILPITAS, Calif. (Reuters) – The rapid proliferation of multimedia and Web-ready consumer devices such as smartphones is underpinning a gradual uptick in corporate spending and spurring growth for specialty chipmakers, the top executive at industry player LSI Corp said.

The company, which competes with the likes of Marvell Technology Group Ltd to make chips for computer servers and storage devices, wants to continue to hitch a ride on that wave of consumer devices by providing chips for network and data infrastructure, said Chief Executive Abhi Talwalkar.

“There’s richer content flowing through networks,” he said in an interview at LSI’s offices in Silicon Valley.

“Just the push of richer PDAs (handheld devices), and the growing mix of PDAs as a percentage of overall mobile subscribers — that in itself is driving tremendous requirements,” he added, referring to both network infrastructure and data storage for Internet-centric devices.

Analysts say the “smartphone” segments are poised for more growth. Competition from the likes of Apple Inc’s iPhone, Research in Motion’s BlackBerry and Palm Inc’s Pre have turned a once nascent market into a thriving business with billions of dollars in sales.

The growing demands of video communication and Internet-centric portable devices have increasingly spurred demand for more servers, communications equipment and storage in past years, and the trend is set to continue, he said.

Talwalkar declined to predict when industry revenues will return to pre-recession levels.

In 2008, LSI’s revenue exceeded $2.67 billion in a market worth $11 billion to $12 billion. Analysts expect LSI to rack up just under $2.21 billion in revenue in 2009, according to Thomson Reuters I/B/E/S.

“We’re penetrating 20, maybe 22 percent in our market,” Talwalkar said. “We’ve got plenty of room to grow across all our categories in storage and networking.”

He also said that while the technology sector has seen a spate of recent acquisitions, LSI does not plan to make any more in the near future.

“After nine acquisitions and two divestitures in the last four years, we’re in the best position the company’s been in years,” he said.

(Reporting by Ian Sherr; Editing by Richard Chang)

(Originally published December 3, 2009, on the wire at Reuters News, here.)