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Qualcomm (QCOM) is losing Chinese smartphone processor share to MediaTek and Spreadtrum (SPRD),...

Qualcomm (QCOM) is losing Chinese smartphone processor share to MediaTek and Spreadtrum (SPRD), says TrendForce. Qualcomm's share is believed to have fallen to 33%. For reference, Strategy Analytics put Qualcomm's global baseband chip share at 59%. MediaTek is seen having a 52% Chinese processor share, and Spreadtrum (fresh off preannouncing a blowout Q2) an 11% share; both have been very aggressive with pricing. Qualcomm is trying to strengthen its hand by launching cheap quad-core processors and courting reference design wins. The launch of Chinese 4G services could eventually boost Qualcomm's share. IDC estimates Chinese smartphone sales rose 117% Y/Y in Q1, and made up 36% of global shipments.
Comments (8)
  • thomas.tintin
    , contributor
    Comments (213) | Send Message
     
    There is a logic error here. How could compare the global share to local share and deduce the market share lose? It should compare the Qcom 2012 market share with 2013 market share.
    "Of the estimated 180 million smartphones sold in China this year, 110 million, or over 60%, feature MediaTek chips, compared to 60 million with Qualcomm chips, according to Lu Xiangzheng, president of MediaTek China."
    http://bit.ly/125ovJD
    From here we can see it is MediaTeck is losing market share to SPRD and Qaulcomm remains unchanged.
    28 Jun 2013, 08:03 PM Reply Like
  • getgl
    , contributor
    Comments (612) | Send Message
     
    Thank you Thomas for the clarity of your reply to the article. I didn't see your point when I read it, but the article seemed odd to me for the way it drew it's comparisons. Thanks again for your input.
    29 Jun 2013, 03:03 AM Reply Like
  • mullenjl
    , contributor
    Comments (56) | Send Message
     
    Thanks Thomas.

     

    Also curious, Seeking Alpha provides no source to the article as it normally does (except the quoted sentence from China Times).

     

    Wonder who authored the sloppy/ inaccurate piece sent to 16,721 people?
    29 Jun 2013, 10:30 AM Reply Like
  • SA Editor Eric Jhonsa
    , contributor
    Comments (802) | Send Message
     
    Just to be clear, while TrendForce is saying Qualcomm lost Chinese smartphone processor share, they aren't saying this is because because its estimated 33% share of the Chinese smartphone processor market is less than Strategy Analytics' estimated 59% global baseband share for 2012. Strategy Analytics' figure was simply provided as a point of comparison.

     

    There's nothing inaccurate about the post. And a source link is provided. Click on "TrendForce."
    29 Jun 2013, 12:38 PM Reply Like
  • mullenjl
    , contributor
    Comments (56) | Send Message
     
    Eric, re: QCOM losing share in China smartphone market.
    You wrote-

     

    1) “.. Just to be clear, while TrendForce is saying Qualcomm lost Chinese smartphone processor share, they aren't saying this is because because its estimated 33% share of the Chinese smartphone processor market is less than Strategy Analytics' estimated 59% global baseband share for 2012. Strategy Analytics' figure was simply provided as a point of comparison…”

     

    a) The original emailed article >>>>

     

    QCOM: Qualcomm (QCOM) is losing Chinese smartphone...
    6:27 PM Qualcomm (QCOM) is losing Chinese smartphone processor share to MediaTek and Spreadtrum (SPRD), says TrendForce. Qualcomm's share is believed to have fallen to 33%, well below the 52% global baseband chip share Strategy Analytics believes it had in 2012. MediaTek is seen having a 52% share, and Spreadtrum (fresh off preannouncing a blowout Q2) an 11% share; both have been very aggressive with pricing. Qualcomm is trying to strengthen its hand by launching cheap quad-core processors and courting reference design wins. The launch of Chinese 4G services could eventually boost Qualcomm's share. IDC estimates Chinese smartphone sales rose 117% Y/Y in Q1, and made up 36% of global shipments.

     

    b) The current article appearing in SA has been revised.

     

    "Qualcomm (QCOM) is losing Chinese smartphone processor share to MediaTek and Spreadtrum (SPRD),...

     

    • Friday, June 28, 6:27 PM ET
    Qualcomm (QCOM) is losing Chinese smartphone processor share to MediaTek and Spreadtrum (SPRD), says TrendForce. Qualcomm's share is believed to have fallen to 33%. For reference, Strategy Analytics put Qualcomm's global baseband chip share at 59%. MediaTek is seen having a 52% Chinese processor share, and Spreadtrum (fresh off preannouncing a blowout Q2) an 11% share; both have been very aggressive with pricing. Qualcomm is trying to strengthen its hand by launching cheap quad-core processors and courting reference design wins. The launch of Chinese 4G services could eventually boost Qualcomm's share. IDC estimates Chinese smartphone sales rose 117% Y/Y in Q1, and made up 36% of global shipments. "

     

    c) One can **now** see from the revised article, the comparison has been made clearer…”.. For reference, Strategy Analytics put Qualcomm's global baseband chip share at 59%...” . However, we still don’t know if in fact QCOM’s share in the Chinese smartphone market has actually fallen (or how much if it has) since 2012 figures are not provided.

     

    2) I stated…”… Seeking Alpha provides no source to the article as it normally does (except the quoted sentence from China Times)…”

     

    a) you answered…”… And a source link is provided. Click on "TrendForce…."

     

    I believe TrendForce is the original source from which SA’s article was written, but does not provide the source of SA’s rendition / the SA’s author’s name.

     

    Was it you, Eric?
    30 Jun 2013, 11:47 AM Reply Like
  • SA Editor Eric Jhonsa
    , contributor
    Comments (802) | Send Message
     
    I wrote the original post. I still don't think it suggests Qualcomm's share fell relative to Strategy Analytics' figure, but since some readers apparently misunderstood the intent, it was edited to make the distinction clearer.

     

    "However, we still don’t know if in fact QCOM’s share in the Chinese smartphone market has actually fallen (or how much if it has) since 2012 figures are not provided."

     

    TrendForce didn't give a 2012 figure. If it had, that would've been included in the post. However, they did provide the following lines:

     

    "Mediatek's processors have been used by over 50% of China's branded smartphones since the MT6575 chip was introduced in 2012. Due in large part to factors such as high pricing and the lack of hardware and software compatibility with various Chinese-made devices, Qualcomm's chip usage rate has been gradually declining in China, and shrunk to as low as 33% in 2013 ... In 2013, Spreadtrum's chip usage rate in the Chinese market grew to approximately 11%."

     

    There's also a pie chart breaking down estimated market shares as of June. At the same time, they included the following. 4G adoption definitely gives QCOM a chance to pick up share, provided the government doesnt' stall service launches.

     

    "A way Qualcomm may reverse its struggles in China is by taking advantage of the country’s rapidly growing 4G/LTE developments. The company will have a good chance of emerging as a major LTE market leader should China’s 4G business opportunities appear early next year."
    30 Jun 2013, 12:35 PM Reply Like
  • Sam Liu
    , contributor
    Comments (3864) | Send Message
     
    What is QCOM, doing with respect to Cn chip makers "adopting" its standards?
    30 Jun 2013, 02:28 PM Reply Like
  • mullenjl
    , contributor
    Comments (56) | Send Message
     
    Eric, thanks for your latest response and clarifications.

     

    Trendforce’s article and your follow-up sourcing such continues a series of media blitzes painting QCOM in a negative light ( losing to Intel, Mediatek, Spreadtrum, Broadcom, Nvida, etc, etc). First off, why use Trendforce as a legitimate source (first time I’ve heard of them) since their website mentions no expertise in wireless baseband / AP products?

     

    >>>>>
    TrendForce

     

    "TrendForce is a global provider of market intelligence, in-depth analysis and consulting services. TrendForce consists of 4 major research divisions – DRAMeXchange, WitsView, LEDinside and EnergyTrend which cover research sectors including DRAM, NAND Flash, PC, LCD display, LED, and green energy. Additional information can be found at http://www.trendforce.co"

     

    >>>>>&a...

     

    Second, Trendforce’s cited article states Mediatek had over 50% share in China since 2012, so **if** Qualcomm did lose some share how significant could it have been to warrant…”… Qualcomm may reverse its struggles…”?

     

    Smartphone processor market share in China’s smartphone market (trendforce chart / article)

     

    ……………June 2013……..2012
    Mediatek…....52%......... (over 50% since MT6575 intro in 2012)
    QCOM………33%
    Spreadtrum …11%
    Others……….4%
    Total ………100%

     

    Third, as you must know, getting reliable “whitebox” sales data in China has long been an issues with the analyst community, so how reliable are Trendforce’s stats, especially since they omit 2012 percentages and **all** unit figures?

     

    Fourth, the Chinese smartphone market is expanding rapidly and even perhaps losing a few percentage points of share to China’s domestic companies in a rapidly expanding “pie” hardly qualifies as “struggling”, right?

     

    China built smartphones (CS rpt)
    ………………………………….2011…..2...
    + top Chinese brands………..19.1……69.2…...
    + other/ whitebox………………3.9…...5...
    Total china shipments (m)……23.0….125.8…..258.3

     

    Five, would one expect Qualcomm to immediately take share from entrenched China based companies as 2G subs migrate to 3G and smartphones?

     

    Six, Qualcomm has stated they are actively involved in the Chinese market and Qualcomm’s QRD program has begun to gain traction with 40+ OEMs launching 100+ devices.

     

    Seven, I imagine most of the 16,000 SA folks getting QCOM email alerts don’t follow the company as close as some of us long-timers do, so how is this “sketchy” “news” benefiting them?

     

    Eight, ending on a positive note, your’s and Trendforce’s article did mention…” The company (Qualcomm) will have a good chance of emerging as a major LTE market leader should China’s 4G business opportunities appear early next year."
    30 Jun 2013, 05:30 PM Reply Like
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