First-tier Taiwan-based vendors and makers have appropriated in-house or affiliated smartphone R&D resources to develop tablet PCs, which may reduce competitiveness in the smartphone market, according to industry sources.

The vendors include Acer and Asustek Computer while makers are mainly Foxconn Electronics, Inventec, Compal Electronics, Quanta Computer, Pegatron Technology and Qisda, the sources noted.

The appropriation is because the global tablet PC market seems to have large growth potential while the global smartphone market has intensive competition despite fast growing demand, the sources indicated.

Demand for tablets PCs is projected at in 2011, but it is uncertain whether tablets will see steady growth or just turn out to be another short-term fad, the sources pointed out. Even if demand for tablet PCs grows steadily, Apple may grab a large portion of the market, leaving the small remainder to share among many vendors, the sources analyzed.

In addition to the risk, players are likely to miss potential smartphone orders due to reduced R&D capacity, the sources pointed out.