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The International ARM Race: Rise Of The Chinese SoC

China Turns Up the Heat

ARM’s open-license model has allowed it to become ubiquitous in the mobile market, simultaneously giving lesser-known or brand-new semiconductor companies the opportunity to use its IP to build SoCs of their own. Those chip makers can then use their hardware to compete against the well-known semiconductor giants.

Many of these companies, which don’t yet have pervasive brands, have to compete against the entry-level offerings from larger, more established competitors. This is exactly the kind of strategy Chinese companies use to excel, thanks to the low costs of manufacturing. Now, as some of those vendors cultivate more notable brands, many device manufacturers are starting to choose their wares, and not just because of low prices.

The Chinese semiconductor companies started out at the lower end of the performance spectrum, and have successively raised the bar to hit higher levels. More powerful SoCs command greater premiums and earn higher margins. Naturally, they all want to increase their profits.  

At the same time, since they've been offering aggressive pricing from the beginning, even their quicker processors are still considered affordable compared to the competition. This should allow them to steal market share from the better-known chip companies, even at the high end of the mobile chip market, earning positions in more popular flagship devices, which, in turn, will strengthen their brand.

The Chinese chip makers that seem to be doing the best right now are MediaTek, Rockchip, and Allwinner. Together, they have 75.7 percent of the tablet processor market in China, with Rockchip and Allwinner taking the lead.

MediaTek is doing much better in the phone market in China, with over 50 percent market share, thanks to the integration of its processors with baseband modems. Its main Chinese competition there is Spreadtrum, though that company’s market share is five times smaller.

Qualcomm is the only real challenge to MediaTek in the Chinese smartphone market. But even that juggernaut had to adopt stock Cortex-A5 and -A7 designs in order to become price-competitive. It had a brief advantage in the LTE market by integrating the cellular standard into its SoCs. However, Qualcomm’s market share is declining as more companies integrate baseband modems.

With the Chinese government and manufacturing customers tending to favor Chinese chip makers as well, it's going to become increasingly difficult for an outsider like Qualcomm to compete against these fast-growing Chinese chip makers, especially when they can't even beat them on price.

  • blackmagnum
    God bless, America. If you can't beat them, join them!
    Reply
  • jossrik
    It'll be interesting to see where manufacturing goes in the future, maybe back to EU or even Africa somewhere maybe. Right now it's hard to see things get cheaper than China, but of course, eventually it will happen. I hear Apple is gonna buy China.
    Reply
  • jjjjkkkk
    MediaTek is Taiwanese not Chinese
    remove it from the list
    Reply
  • Draven35
    The company's first commercial foray using this technology came in 1983 with the 16-bit Acorn RISC Machine, or ARM. It ran one of the first true multitasking operating systems in production, RISC OS,

    Except, the first silicon didn't exist until 1985, and the machine running RISC OS didn't exist until 1987.
    Reply
  • blubbey
    God bless, America. If you can't beat them, join them!

    ARM are British though..... (unless I'm missing something which is entirely possible).
    Reply
  • virtualban
    The Chinese may leech off and profit from current available designs, and close-source their 'innovations', but I wonder what will they do when the rest of the world will reverse engineer and use any progress they make without having to answer to the Chinese companies (duh).
    Reply
  • icemunk
    The writer seems to think the RK3288 is a 2015 SOC, however it has been out since April, and many devices are available with it, lots of $200 tablets with 2000X1500 resolution, and a bunch of TV boxes as well for $100. It's an excellent chip, achieving around 40,000 antutu scores. 2015 I'm sure we'll see a brand-new Rockchip, but the RK3288 has been out for some time.
    Reply
  • MediaTek is Taiwanese not Chinese
    remove it from the list

    Since when is Taiwanese not Chinese? Read a book.
    Reply
  • oxiide
    MediaTek is Taiwanese not Chinese
    remove it from the list

    Since when is Taiwanese not Chinese? Read a book.
    Hopefully your books mention that the Republic of China (Taiwan) and the People's Republic of China (mainland China) are two distinct and, for the most part, recognized nations.

    MediaTek is indeed a Taiwanese company, though I'd rather they just specify that in the article rather than being told to remove it over a technicality. It's still relevant to the topic regardless of where they are headquartered.
    Reply
  • amk-aka-Phantom
    Thanks to the author for pointing out the closed-source BS, this makes me hate Mediatek. Others are irrelevant (luckily) so far, don't see their chips in any reasonable devices.
    Reply