Qualcomm chips’ market share is falling in China after US sanctions towards Huawei
Qualcomm’s Snapdragon 888 chip is used in premium Android devices that could cost over $ 1000.
According to a new report, Qualcomm’s market share in the Chinese smartphone chip market declined in 2020 due to US sanctions against Huawei.
As a result, the country’s domestic wireless carriers turned to alternatives like Taiwan’s MediaTek, according to CINNO Research.
Last year, 307 million so-called System on Chips (SOC) for smartphones were shipped in China, a decrease of 20.8% compared to the previous year.
SOC is a type of semiconductor that contains many of the components necessary for a device to operate on a single chip such as a processor. They are an important component for smartphones.
According to CINNO Research, Qualcomm’s shipments in China are down 48.1% year-over-year, with no information on the number of Qualcomm chips shipped. The US giant’s market share in China fell to 25.4% in 2020, down from 37.9% in 2019.
MediaTek No. 1
Taiwan’s MediaTek benefited from this pent-up demand. The chip designer took advantage of the problems of Huawei and Qualcomm and also let large Chinese smartphone manufacturers use his chips.
“As far as we know, the MediaTek share (for) OPPO, Vivo, Xiaomi and Huawei has risen sharply,” CINNO Research told CNBC in a statement by its analysts.
Huawei is China’s largest smartphone maker by market share, followed by Vivo, Oppo and Xiaomi.
Many of these players make phones that are mid-range in price but have high specifications. MediaTek achieved good results here.
The US sanctions against Huawei have also forced other Chinese players to look for alternatives in case they are cut off from Qualcomm.
“Not only is this due to the excellent performance of MediaTek’s mid-end platform, but there is no denying that the US has imposed a series of sanctions on Huawei & Hisilicon that are forcing major manufacturers to become more diversified and stable to strive and reliable sources of supply, “said CINNO Research in a press release.
Xiaomi was recently added to a U.S. blacklist of suspected Chinese military companies, although it is unclear whether this will affect their ability to source certain components.
Winning the 5G market
China is the world’s largest market for 5G smartphones. 5G refers to the next generation of mobile internet, and chipmakers are fighting for a piece of cake.
“After the first year of 5G, let’s take a look at the changes in the Chinese smartphone SOC market. This shows that the market pattern is changing from a single dominant Qualcomm company to a three-party in the 4G era. Patterns changed from Hisilicon, Qualcomm, and MediaTek in 2020, “said CINNO Research.
Last year, Qualcomm launched a new line of 5G smartphone chips, known as the 6 and 4, which could hurt MediaTek’s market share in China.
“Qualcomm, which launches the 6 and 4 series 5G chipset, will help MediaTek participate in the fast-growing 5G smartphone segment in China,” said Neil Shah, partner at Counterpoint Research.