MediaTek Beats Qualcomm as Top Smartphone Chip Supplier

Article By : John Walko

MediaTek has, for the first time, overtaken Qualcomm as the…

Taiwanese chip group MediaTek has, for the first time, overtaken Qualcomm as the highest volume chipset provider, according to Hong Kong-based market research group Counterpoint.

The number crunchers estimate that over the third quarter of 2020, MediaTek enjoyed a 31% share of chipsets shipped to smartphone makers as the market rebounded in the quarter. For the corresponding period last year, MediaTek had a 26% share. In contrast, Qualcomm’s share dipped by 2% to total 29% for the quarter.

When it comes to 5G devices, however,  Qualcomm still leads the pack, with a share of 39% of devices shipped worldwide in Q3 2020 being powered by the US company’s chipsets. The market researchers posit that 17% of all smartphone sales in the third quarter of this year were 5G-enabled, and expect this impressive growth trajectory to continue so that the figure for the quarter ending this month will come in at one third being 5G capable.

So they suggest there is a chance Qualcomm will regain top position in Q4 2020.

Dale Gai, Research Director, put MediaTek’s improved performance down to increased shipments to makers of smartphones selling at prices between $100 and $250, and increasing sales in emerging markets such as China, India and Latin American of ‘mid-end’ smartphones.

Gai also said Huawei’s problems following its ban by the US administration was a contributing factor, as were major wins  from OEMs like Samsung, Xiaomi and Honor. Indeed , he notes the share of MediaTek chipsets sold to fast-growing phone maker Xiaomi trebled since the equivalent quarter last year.

“Affordable MediaTek chips fabricated by TSMC became the first option for many OEMs to quickly fill the gap left by Huawei’s absence. Huawei had also previously purchased a significant amount of chipsets ahead of the ban.”

However, Counterpoint also stresses Qualcomm posted strong share gains in the high-end segments over the same period last year, which they put down to significant supply issues at HiSilicon, Huawei’s chip operation. Gai added Qualcomm faces increasing competition from MediaTek in the mid-end segment, but “both will continue to compete intensively through aggressive pricing, and mainstream 5G SoC products into 2021.”

Focusing on the outlook for chipset vendors, Ankit Malhotra, Research Analyst at Counterpoint said the immediate target will be to bring 5G devices to the masses, “which will then unlock the potential of consumer 5G use-cases like cloud gaming, which in turn lead to higher demand for higher clocked GPUs and more powerful processors. Qualcomm and MediaTek will continue to contend for that position.”

The Taiwanese group’s recent launch of its Dimensity 700 SoC targeting 5G devices will certainly help in this regard, as will the Dimensity 800, seen as the answer to competing against the latest Snapdragon chip sets from Qualcomm.

Commenting on the increased rivalry between the two main chip set makers, and their growth strategies, Malhotra stressed Qualcomm and MediaTek “both reshuffled their portfolios, and consumer focus has played a key role here. Last year, MediaTek launched a new gaming-based G-series, while Dimensity chipsets have helped in bringing 5G to affordable categories. The world’s cheapest 5G device, the realme V3, is powered by MediaTek.”

Interestingly, despite HiSilicon’s well –publicised issues, it still managed to retain its 12% market share, which in Q3  2020 it shared with Samsung and Apple (see chart). Compared with the same period last year, Samsung’s share fell from 16% while Apple’s increased from 11%.

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