Tech News: Qualcomm’s market dips in China after Huawei sanctions: MediaTek gains No.1 Spot.
Qualcomm’s market share in China’s smartphone chip market plummeted in 2020 following US sanctions against Huawei, according to a new report. As a result, domestic mobile players have turned to alternatives like MediaTek of Taiwan, according to CINNO Research.
Last year, 307 million smartphone systems-on-chip (SOC) were shipped to China, down 20.8 percent year-on-year, the report said. SOCs are semiconductors that contain on a single chip a large number of components required to operate a device, such as a processor. They are a crucial component of smartphones. Qualcomm’s shipments to China fell 48.1% year-on-year, CINNO Research said, without releasing details on the number of Qualcomm chips shipped. The US giant’s market share in China dropped to 25.4% in 2020 from 37.9% in 2019.
Part of the reason for Qualcomm’s drop in market share is due to US sanctions against Huawei. The Chinese telecom giant was placed on a US blacklist known as the Entity List in 2019, which bans US companies – including Qualcomm – from export some components to Huawei. Huawei has used some Qualcomm chips in its devices. At the time, Qualcomm said export restrictions had hurt its business.
The US chip maker’s market share in China began to decline in 2020 as Huawei began to focus more and more on its own chip division, HiSilicon. Huawei’s high-end devices use the company’s Kirin chips, designed by Huawei and manufactured by Taiwan’s TSMC.
The change helped make HiSilicon the largest smartphone chip player in China by the first half of 2020.
However, the United States continued to put pressure on Huawei, and in May the Trump administration decided to deny Huawei access to TSMC-made chips. Huawei’s SOC market share has decreased from 37% in the first half of 2020 to 27.2% in the second half of the year.
MediaTek earns first place
MediaTek of Taiwan benefited from this from all that pent-up demand. The chip designer took advantage of this from the troubles of Huawei and Qualcomm, and even the big Chinese smartphone makers have used its chips.
“As far as we know, (for) OPPO, Vivo and Xiaomi and Huawei, MediaTek’s stake has become much larger,” CINNO Research told CNBC in a statement. from its analysts.
Huawei is the largest smartphone maker in China by market share, followed by Vivo, Oppo and Xiaomi. Many of these players make mid-range phones, but with high specs. This is where MediaTek has done well by earning odds. US sanctions against Huawei have also forced other Chinese players to search alternatives in case they were cut from Qualcomm.
“This is not only due to the excellent performance of MediaTek’s mid-range platform, but it is also undeniable that the United States has imposed a series of sanctions on Huawei and Hisilicon, forcing large manufacturers to seek more diversified, stable and reliable sources. supply, “CINNO Research said in a press release.