How Qualcomm is Beating MediaTek in Chipset Sales

By Prei Dy, | April 25, 2017

Tables have turned for Qualcomm and MediaTek in the application process industry. (YouTube)

Tables have turned for Qualcomm and MediaTek in the application process industry. (YouTube)

MediaTek has been a thorn in the side for Qualcomm in the smartphone application process industry, posting a market share increase from 14 percent in 2014 to 23 percent in the first half of 2016. But the table is turning now as the Taiwanese chipmaker's shipment growth stalled in the first quarter of this year.

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DigiTimes reported that MediaTek looks unable to surpass its 480 million chipset sales in 2016. It shipped fewer than 100 million smartphone chips in the first quarter of 2017 that ended March, although the second quarter outlook is a little brighter with 110 million to 120 million units.

Meanwhile, in China, Qualcomm shares saw a significant increase of over 30 percent in the first quarter, while MediaTek dropped to as low as 40 percent. Jun Zhang, an analyst at Rosenblatt Securities, said that fast-growing Chinese firms such as OPPO and Vivo helped Qualcomm ship at least 28 million Snapdragon 835 chips into China last quarter, up from the merely 8 million units Qualcomm sold in the year-ago quarter.

Furthermore, Zhang also predicts a 65 percent market share for Qualcomm in China this year after it won several Chinese contracts from Meizu, OPPO, Xiaomi, and Vivo. MediaTek used to supply all these brands.

OPPO and Vivo, for instance, are a big snatch for Qualcomm as both brands account for nearly half (46%) of China's smartphone sales in the last quarter of 2016. The two smartphone makers are also starting to dominate the fast-growing Indian market, grabbing a combined 16 percent share. They are also predicted to ship more than 300 million smartphones this year, accounting for a fifth of global shipments.

OPPO shifted from MediaTek's Helio P10 processor, which powers its F1 Plus, to Qualcomm's Snapdragon 653 for its latest flagship F3 Plus. Vivo's flagship unit, the V5 Plus, is also powered by Qualcomm.

Meanwhile, MediaTek's attempt to compete with Qualcomm in the high-end end of the market through its latest Helio X30 chip is failing, according to Madison.com. According to Jeffrey Ju, MediaTek's co-chief operating officer, despite using the 10-nanometer process technology used in Qualcomm's Snapdragon 835, no more than 10 smartphones are going to install MediaTek's premium chip.

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