14 DAY TRIAL // It looks like Chinese OEMs have decided to shift from a predominant MediaTek-powered smartphone production to devices packed with Qualcomm's chipsets. The decision might have been motivated by the performance of the Snapdragon CPUs and the fact that MediaTek was at the center of many security stories last year.
Fear that MediaTek might include software inside its chipset that could lead to privacy breaches convinced many customers to avoid devices equipped with processors made by the Taiwanese company.
Oppo and Vivo, the largest smartphone makers in China, have largely adopted SoC solutions from Qualcomm in Q4 2016, thus lowering the ratio of MediaTek's chipsets used in their total smartphone production, Digitimes reports.
No less than 50% of the 99.3 million smartphones shipped by Oppo in 2016 were powered by MediaTek CPUs, whereas Vivo's shipments of more than 77 million units included similar solutions from the Taiwanese company, source in the industry claim.
However, due to fierce competition with Qualcomm at the budget-friendly and mid-range tier, MediaTek's gross margin declined by 7.6% during the year.
Now, a third Chinese smartphone maker has decided to lower the ratio of MediaTek solutions included in its products and switch to Qualcomm SoCs.
Meizu, which shipped 22 million smartphones in 2016, has recently signed a partnership with Qualcomm which will allow the Chinese company to expand its lineup of Snapdragon-powered handsets.
The decision made by Meizu was partly forced by the keen competition with Oppo and Vivo, which have already adopted more Qualcomm AP solutions and have been successful.
Currently, 90% of Meizu's smartphones include MediaTek SoC solutions, but beginning Q3 2017, 30% of the phones shipped by the Chinese company are expected to be powered by Qualcomm Snapdragon processors.
The percentage might increase throughout 2018 if Qualcomm maintains the pressure and MediaTek doesn't come up with any “wonder products” that could win back some of its major Chinese clients.