Most of the Chinese smartphone giants are looking to produce more of its own chips. Consequently, MediaTek steps up investment in research and development and brand awareness. It aims to better compete in the field.
Mediatek is a Taiwanese fabless semiconductor. The company provides chips for wireless communications, smartphone, tablet computers, and many more. Besides, MediaTek is now a close competitor to US chip giant Qualcomm.
MediaTek’s smartphone chip business generates about a third of the overall group revenue. The company most of the sales coming from Android phone makers, especially those in China.
The move also comes after it had been hit by a downturn in smartphone chip demand. Thus, it suffered a drop of 0.7% in US dollar annual revenue in 2018.
The trend of smartphone’s brand making its own Chips
Many of smartphone giants in China start to produce its own chips. For instance, Oppo, the second-largest smartphone vendor in China. The brand is currently using both Qualcomm and MediaTek chips for its handsets. However, it has started to develop its own chips.
Oppo move followed Huawei Technology. Huawei is China’s leading smartphone vendor. Huawei currently relies mostly on its self-made Kirin chips to power its smartphones.
Unlike those two brands, Xiaomi has put its focus on AI-based internet-of-things (AIoT) chip development. However, the company states that it focuses on AI-based internet-of-things (AIoT) chip development.
Therefore, through its new R&D investment, MediaTek plans offer more advanced technology to its market.
Besides, MediaTek is also preparing for the 5G network revolution. The company sees it as a chance to take a bigger share of the higher-end market and dispel the notion that it is simply a cheaper alternative to Qualcomm for low-end chips.
MediaTek expects the roll-out of the next-generation network to drive large shipments of its 5G smartphone chips in the first quarter of 2020. Besides, it also wants to help vendors bring down the retail price of 5G phones. It plans to drag the price below 2,000 yuan (US$283) in the second half next year.