|
The field of mobile phone chips has been in a state of "hot movement" in the past two years: in 2014, foreign chip companies such as Nvidia, Broadcom, and Ericsson successively announced their withdrawal from the mobile phone chip market; in 2015, Qualcomm announced news of declining performance, layoffs and even splitting.
At the same time, Chinese chip manufacturers seem to be in good shape: Marvell is up for grabs, and the buyer is located in China; Tsinghua Unigroup has aggressively acquired Spreadtrum and RDA, and Spreadtrum is showing signs of recovery; Leadcore Technology has also gained a foothold in the 4G chip market; HiSilicon has also become a success story due to the growth in Huawei's mobile phone sales.
In addition, there are "variables" such as Intel, MediaTek, Apple, and Samsung in the market. Do these subtle changes mean the end of Qualcomm's oligopoly? Will Chinese chips rise in this reconstruction of the mobile phone chip landscape?
Will Qualcomm’s oligopoly end?
Qualcomm released its latest financial report and announced a layoff plan, which is expected to exceed 10% of its employees, reaching 4,000. At the same time, the financial report showed that the net profit in the second quarter was US$1.2 billion, a 47% drop from US$2.2 billion in the same period last year. Qualcomm's major shareholder, venture fund Jana Partners LLC, previously called for the company to be split, and the company also seems to be willing to split.
Qualcomm, which has always been the leader in the field of mobile phone chips, is facing a worrying situation this year. In fact, Qualcomm's market share in the field of mobile phone chips has been declining in the past two years. Data from Strategy Analytics shows that in 2013, Qualcomm still dominated the market with a revenue share of 64%; in 2014, the market share dropped to 52%; in the first quarter of 2015, Qualcomm's market share dropped to 47%. The chip industry is always very competitive.
It may be an exaggeration to say that Qualcomm is under attack from all sides, but it is indeed under attack from all sides.
First, MediaTek is catching up. In 2014, MediaTek released its first 4G chip, breaking Qualcomm's monopoly. It also achieved the goal of 30 million 4G chip shipments in 2014. MediaTek General Manager Xie Qingjiang adjusted the sales target of 4G mobile phone chips to 150 million sets at MWC, with a market share of 20%, which is a rapid momentum. In addition, MediaTek was squeezed by Spreadtrum in the low-end market and began to seize Qualcomm's high-end market share, releasing the Helio X and Helio P series.
Secondly, in the high-end mobile phone market, mobile phone manufacturers have begun to use their own chips. The top three mobile phone manufacturers, Apple, Samsung, and Huawei, all have self-developed chips. "Huawei's market share is constantly rising, and Huawei's high-end phones basically use self-developed HiSilicon chips. Huawei's rise means a decrease in Qualcomm's customers. Under the condition of a certain market capacity, this means that Qualcomm's market share is decreasing." Wang Yanhui, Secretary-General of the China Mobile Alliance, told NetEase Technology.
For example, Samsung, a major customer of Qualcomm, adopted its own Exynos 7420 chip instead of Snapdragon 810 in its flagship phones Galaxy S6 and S6 Edge this year, which had a huge impact on Qualcomm. Although the sales of S6 were not as expected, the sales of 18 million units in one quarter were still the best-selling high-end model besides iPhone.
"Another potential impact is Intel," Wang Yanhui analyzed. "Intel has been eyeing Apple. Not long ago, it acquired VMware's CDMA2000 technology, which allows it to provide full-mode baseband chips. It is possible to seize Apple and Samsung, two major customers held by Qualcomm."
Qualcomm's oligopoly seems to be in jeopardy. However, Wang Yanhui believes that Qualcomm's dominance in the high-end market will continue in the next 2-3 years. After all, Qualcomm is still in a leading position in technology. Qualcomm's upcoming Snapdragon 820 will support the Cat.10 standard, while other chip manufacturers are still stuck at the Cat.6 and Cat.9 standards (except Huawei's self-developed and self-supplied HiSilicon Kirin 950, which also supports the Cat.10 standard). MediaTek is still unable to compete with Qualcomm in the high-end market.
In addition, Samsung may continue to use Qualcomm chips next year, which means Qualcomm has regained a major customer. Wang Yanhui revealed to NetEase Technology that Qualcomm will force Samsung to continue using Qualcomm chips in exchange for chip foundry business. "In addition to developing its own chips, Samsung also does chip foundry. Qualcomm hopes to hand over the foundry business to Samsung instead of TSMC, on the condition that Samsung uses Qualcomm chips. After calculations, Samsung believes that foundry business is more profitable. Therefore, mainstream models in 2016 will still use Qualcomm chips."
Therefore, in the next 2-3 years, Qualcomm will still occupy the high-end models of mainstream mobile phone manufacturers; MediaTek will still focus on mainland mobile phone brands; and Spreadtrum will rely on Samsung and second- and third-tier brands.
The rise of Chinese chips: a disruptor in the mid- and low-end markets
As the king of mid-range products, MediaTek is now feeling uneasy.
According to a Strategy Analytics report, Spreadtrum's market share in 3G baseband reached 29.3% in the first quarter of 2015, with shipments of 63 million units, surpassing MediaTek's 60 million units. "Spreadtrum is a disruptor, and its goal is not to make money, but to gain market share. MediaTek will be directly affected," Wang Yanhui said.
Spreadtrum was in the leading position in the 2G era, but missed the best development opportunity in the 3G era because it started too late. However, with the stability and maturity of communication technology in 4G, Spreadtrum gradually caught up. In the field of communications, the golden period of commercial use of mobile communication standards is generally 5-8 years. At present, the golden period of 4G mobile communication applications can be extended to at least 2020, and the life cycle of 28nm process chips supporting 4G commercial use is also 4-5 years, which gives domestic chip manufacturers an opportunity to catch up.
In terms of time, Spreadtrum has ample time to narrow the gap with the world's leading level; in terms of funds, Spreadtrum has the strong support of its parent company Tsinghua Unigroup.
Between 2013 and 2014, Tsinghua Unigroup acquired two chip companies, Spreadtrum and RDA Microelectronics, and vowed to build a world-class enterprise group in the field of semiconductor chips. Therefore, Tsinghua Unigroup gave Spreadtrum huge financial support. Tsinghua Unigroup received a 10 billion investment from the National Integrated Circuit Industry Fund, and Spreadtrum, as a subsidiary, naturally benefited.
"With the support of its parent company Tsinghua Unigroup and the country, Spreadtrum can be said to have no shortage of money." An insider in the chip industry said, "Therefore, Spreadtrum uses money to buy technology and talent, and does not expand the market for the purpose of profit." It is understood that after Spreadtrum expanded its recruitment by 1,000 people in 2014, the total number of employees was more than 4,000.
"The 9 billion RMB investment from Intel in Unisoc recently came in, which greatly alleviated Spreadtrum's financial difficulties and also provided sufficient funds for Spreadtrum to seize the WCDMA and LTE markets in the second half of the year. Spreadtrum will adopt more aggressive market strategies in the future. With Spreadtrum's full return, the price war between Qualcomm and MediaTek will become even more brutal," said Wang Yanhui.
In addition, another Chinese chip manufacturer, Leadcore Technology, is also making plans in the 4G field. Qian Guoliang, general manager of Leadcore Technology, said that Leadcore Technology's 8-core 64-bit chip products for LTE Cat.9/10 communication standards have entered the product layout stage, and the process technology will reach the 14nm level. The news of Datang Telecom Group's acquisition of Marvell is also good news for Leadcore Technology. After all, Marvell has a certain amount of technical accumulation in LTE-FDD and LTE-TDD. Acquiring Marvell's wireless business can make up for its own shortcomings and consolidate its market position.
Data provided by Leadcore Technology shows that in 2015, smartphones equipped with "Chinese chips" are expected to account for 20% of the domestic market share, and the territory of Chinese chips will gradually expand.
Wang Yanhui warned: "The purpose of Chinese chip manufacturers' price war is to seize the market. But if the technical strength does not keep up, the price war regardless of cost is meaningless."
In short, although the market has seen the rise of Chinese chips, the high-end market remains a difficult problem to conquer.
As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity. |
