Chinese Firms Cut 84 Billion Chips Orders, US Chip Giants Announce Price Drop

It is well-known that, due to an early start, American chip companies have absolute say in the global chip market, with Qualcomm, Intel, and NVIDIA holding high market positions in the smartphone sector, PC computer sector, and GPU sector, respectively. It can be said that American companies have made a fortune in the chip market.

However, since the entry of Chinese companies like Huawei and Yangtze Memory into the semiconductor industry, the United States has become restless. In order to curb the development of our country's high-tech industry and to protect the interests of American companies, as long as a Chinese company masters the core technology of the chip industry, the United States will use various means to cut this industrial chain clean. Especially the sanctions against Huawei directly reduced HiSilicon to a "decoration", and the Kirin 9000 series of chips also fell into disrepute because TSMC could not undertake the work.

In response, Bill Gates once predicted: not selling chips to China will only prompt Chinese companies to accelerate self-sufficiency in chips. Unexpectedly, Bill Gates' words have come true, and China's chip self-sufficiency rate is continuously increasing. According to public data, in the first 11 months of 2022, the number of imported chips in China decreased by 84 billion compared to the same period, which is equivalent to Chinese companies cutting orders by 250 million chips per day.

Another piece of data is also worth mentioning, that is, in the first half of 2022, the number of chips produced in China reached 190 billion, which is 1 billion per day.

Advertisement

Under such circumstances, American chip companies that mainly export chips began to "panic", and the huge inventory backlog also made American companies anxious. Once the chips that were priced at 200 yuan are now reduced to 20 yuan and no one cares. Despite this, Qualcomm still announced an important decision, that is, to reduce the prices of mid-range and entry-level Snapdragon processors in 2023, including the Snapdragon 600 and Snapdragon 400 series.

It should be noted that Qualcomm has a great influence in the Android camp, and many domestic mobile phone brands use Qualcomm processors. However, since the chip rules were changed, Qualcomm processors have become less popular. On the one hand, in order not to repeat Huawei's mistakes, domestic mobile phone manufacturers such as Xiaomi and OV have begun to develop their own chips to reduce their dependence on American chip companies. On the other hand, MediaTek processors have become the first choice for domestic mobile phone manufacturers. According to data, MediaTek ranked first in the smartphone AP market in the third quarter with a market share of 35%, and has been in the top position of mobile SOC shipment for nine consecutive quarters.

So the question is, can Qualcomm regain the top position in the world by reducing the prices of mid and low-end chips? In fact, the answer is very simple, it cannot. First, MediaTek has already stabilized the mid and low-end chip market, and even if Qualcomm reduces prices, it is difficult to shake MediaTek's position in a short time. Moreover, MediaTek also has the advantage of high cost performance.

Secondly, after Huawei Hisilicon, Unigroup has also begun to emerge, and the processors designed by Unigroup are not bad in terms of chip process and chip performance. According to the official data, Unigroup has surpassed Samsung and is the fourth largest chip company in the world.

It is undeniable that in the high-end chip market, Qualcomm's position is indeed unparalleled. However, in the case of both MediaTek and Unigroup focusing on the mid and low-end chip field, even if Qualcomm is strong, it can only watch helplessly as the mid and low-end market share is "divided".