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How MediaTek managed to dethrone Qualcomm in World’s biggest smartphone market

MediaTek managed to dethrone Qualcomm: MediaTek recently topped Qualcomm as the worlds number one chip vendor. A position that Qualcomm has been holding for a long time. While analyst predicts that Qualcomm will reclaim the number one spot, its good we take a look at what really happen (what is happening).

One of the key specs of a smartphone is its System-on-chip (SoC). And for the most part, it accounts for the price of smartphones. It appears that, the better the SoC the more expensive the smartphones and vice versa.

But according to a CINNO research on CNBC, shipments of System-on-chip (SoC) fell by some 20.8 percent to 307 million units in China in 2020. Why is this significant?

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Rumor has it that the U.S. sanctions on Huawei are hurting Qualcomm. Huawei previously used to power some of its devices with chips (SoC) from Qualcomm. When the US ban began, Huawei increased its efforts on its own chipmaking arm HiSilicon and this made the subsidiary the number one smartphone chip provider in China in the first half of 2020.

Introduction of more restrictions by the United States virtually paralyzed HiSilicon and Huawei had to turn to MediaTek for SoC to power its some of its devices. Other Chinese companies such as Vivo, Oppo, and Xiaomi also started migrating to using MediaTek. You know what they say; it’s better to be safe than sorry.

With Xiaomi recently blacklisted by the United States as a brand linked with the Chinese military you can say these Chinese companies saw it coming. With Qualcomm gradually fading out of the picture for Chinese companies, MediaTek started coming into the picture.

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Coupled with the fact that MediaTek also make low cost chipset than Qualcomm, makes it perfect for these Chinese companies. According to PhoneArena, The share of MediaTek chips in the company’s phones has increased by more than three times when compared to the same period last year. 

This (is) not only because (of) the excellent performance of MediaTek’s mid-end platform, but also, it is undeniable that the U.S. has imposed a series of sanctions on Huawei & Hisilicon, forcing major manufacturers to seek more diversified, stable and reliable sources of supply.

CINNO Research.

A report previous from Counterpoint shows another reason why MediaTek could overtook Qualcomm as largest smartphone chip vendor in third quarter of 2020. Although Qualcomm is expected to bounce back and regain the number spot but MediaTek won’t be backing down so easily.

Both MediaTek and Qualcomm announced flagship chips, 5G chips and even newer mid and low entry chip for 2021 smartphones. Don’t forget that Samsung Exynos and Huawei Kirin chips are also in the market. So, this is how MediaTek managed to dethrone Qualcomm and the tech battle continues in 2021.

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