Qualcomm, MediaTek and Spreadtrum will remain the top-3 handset IC suppliers in 2017, with Qualcomm dominating the high-end market, and MediaTek and Spreadtrum sharing the mid-range and low-end segments, according to market sources.
MediaTek's late availability of mobile chips that come with a Cat 10 modem has negatively affected the company's performance since the second half of 2016. The company has also seen its gross margin fall to as low as 35% from nearly 50%, as the company is being engaged in fierce price competition in the smartphone-SoC market.
Nevertheless, with its competitive 10nm Helio X30-series, the Taiwan-based firm is expected to make a comeback in the smartphone-chip market in the second half of 2017, the sources said. Meanwhile, upcoming cost-competitive products will help the company improve its cost structure.
MediaTek is looking to roll out a new mobile chip series built using TSMC's 12nm process technology later in 2017, the sources indicated. The upcoming solution is expected to bring MediaTek a highly competitive performance/cost advantage, the sources said.
Starting the first half of 2017, Qualcomm has grabbed orders from MediaTek's existing customers including Oppo, Vivo, Xiaomi and Meizu, the sources noted. Oppo, Vivo and Xiaomi have all adopted Qualcomm's Snapdragon 835 chips for their high-end models.
Meanwhile, Meizu, which used to supply over 90% of its smartphones with MediaTek solutions, has shifted part of the orders to Qualcomm, the sources said.
Qualcomm with its Snapdragon 6- and 4-series chips has also expanded its presence in China's mid-range and entry-level segments, the sources identified. Nevertheless, as Qualcomm offers fewer discounts than what its China-based rivals offer, whether the US firm will be able to further expand its market presence in the mid- and low-end segment remains to be seen.
Spreadtrum remains competitive in the entry-level smartphone SoC market with its cost-effective platforms but is still less competitive than MediaTek in the mid-range segment. It is anticipated that the 2017 market for smartphone chips will still be led by Qualcomm, MediaTek and Spreadtrum, and the three companies will continue to expand their dominance, according to the sources. |