That changed in 2006. Today, the company known worldwide as HTC designs its own smartphones and tablet PCs, chipping away at the market shares of giants such as Apple and Nokia. , more than double the number in 2009.

Now, after years of keeping a low profile, other firms in Taiwan have realized from watching the likes of HTC and Taiwan's branding pioneer, Acer, that they can use the expertise accumulated from contract work to design and sell their own products, under their own brands.

Newer entrants include the huge contract PC maker Quanta Computer, which has started to sell its own notebooks and smartphones, and Micro-Star International, which will .

Their efforts to move up the value chain are providing end users with new supplier choices for their PCs, smartphones and peripherals, at prices often lower than those from established foreign rivals. Local firms are already known for keeping costs down through cheap labor, the use of factories in China, and quick, flexible means of sourcing components.

"When you're an up-and-coming brand, you compete on price," said John Brebeck, head of Taiwan research with Yuanta Investment Consulting. "Taiwan's edge has always been that they take costs out of the manufacturing process. But we also have really good engineers here."