Qualcomm reduces the price of Snapdragon 765; Mediatek the big hit
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According to a new report from a renowned analyst, MediaTek may lose several earnings from its 5G chip orders. The reason for this is its main competitor, Qualcomm will have lowered the prices of Snapdragon 765, your new option in the mid-range 5G.
Ming Chi Kuo's report suggests that Qualcomm is reconsidering its prices for the mid-range 5G chipset after the demand for high-end 5G phones did not meet expectations. Also The aggressive pricing policy will extend to its low-end offers in the second half of 2020. Therefore, MediaTek will face strong competition in each category approximately 3 to 6 months ahead of schedule for its Dimensity 5G chipset line.
Qualcomm lowers the price of its Snapdragon 765
As it stands now, MediaTek's pricing strategy is not as lucrative as Qualcomm's. The North American supplier will obtain a gross profit margin of 5G processors between 30% and 35%. The report by analyst Ming Chi Kuo also indicates that after a demand for lower-end 5G phones lower than expected, Qualcomm reduced the price of its Snapdragon 765 5G chipset by approximately 30% to about $ 40. This leaves it as a more affordable alternative to the MediaTek Dimensity 1000L chipset, which is offered for a price of between 60 dollars and 70 dollars (the manufacturing cost is in a range of between $ 45 and $ 50).
The figures clearly indicate that Qualcomm's new pricing strategy weakens the entire MediaTek market of offering 5G processors at affordable prices. At present, MediaTek had received orders of between 20 and 25 million chipsets by several phone manufacturers such as Oppo, Vivo and Xiaomi. These orders are supposed to will begin shipping in February 2020. Nevertheless, the new price may interrupt the large-scale order that MediaTek had received, which is expected to change to Qualcomm.
The high end keeps the price
The high-end Qualcomm Snapdragon 865 with X55 5G modem has not changed its price from $ 120,130. This is because it exceeds the MediaTek Dimensity 1000 SoC in performance. In particular, the performance of the Dimensity 1000L is higher than that of Snapdragon 765. Finally, the report also details that the future Dimensity 800 SoC faces the biggest threat. This low-end 5G chipset was expected to be launched in May 2020 for between 40 and 45 dollars (the manufacturing cost ranges between 30 and 35 dollars).
Qualcomm will continue the aggressive pricing strategy
Therefore, the report indicates that the competition has arrived 3 to 6 months ahead of schedule. It is also expected that Qualcomm follow the aggressive pricing strategy to avoid further decline in overall earnings. This also struck at a time where it was reported that Huawei and Samsung have increased the use of their own processors in their phones, which made Qualcomm affected.
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