Taipei, Monday, May 25, 2015 08:29 (GMT+8)
light rain
Taipei
23°C
Digitimes Research: Spreadtrum finding smartphone AP business difficult
Eric Lin, DIGITIMES Research, Taipei [Thursday 19 June 2014]

China-based Spreadtrum's application processor (AP) shipments have been dropping since China Mobile began subsidizing dual-core smartphones, as opposed to single-core models, in June 2013, and the company so far is showing no signs of recovery. Spreadtrum's parent company Tsinghua Unigroup's acquisition of China-based communication chipmaker RDA Microelectronics did not provide much benefit to Spreadtrum's operation and instead caused issues over their merging process and delayed Spreadtrum's product planning due to internal struggles.

Spreadtrum's smartphone AP shipments have been mostly TD-SCDMA chips in the first half of 2014, with processors having more than dual cores accounting for almost 50% of the volume. The company's shipment share of WCDMA chips have also risen slightly.

Spreadtrum's SC7715 and SC7730 APs both have competitive pricing, but are unlikely to start shipping until the second half of the year due to software issues. Although Spreadtrum has said it has plans to release LTE products in 2014, the company may only be able to maintain its revenues through its existing products since Digitimes Research believes the chipmaker is unlikely to release any actual LTE products until 2015.

On the other hand, the lower technological threshold required in the feature phone business, combined with the company's competitive pricing, has driven Spreadtrum's chip shipments to reach over 20 million units per month, about the same level as Taiwan's MediaTek. Because of strong feature phone demand, related chips may suffer from shortages at the end of second quarter.

Since Spreadtrum's product lineups for the mid-range and high-end segments are clearly less competitive compared to its competitors, Digitimes Research believes that if Tsinghua Unigroup is unable to resolve issues over internal management and the acquisition of RDA Microelectronics, the company may quickly lose its competitiveness in the smartphone AP market in the future, especially if Spreadtrum is unable to significantly improve its technology.

This article is an excerpt from a Digitimes Research Quarterly Data Report (China smartphone AP shipments – 2Q 2014). Visit our latest Data reports.

Taiwan server shipment forecast and industry analysis, 2015
Wireless broadband developments in Southeast Asia markets
Analysis of China revised domestic semiconductor industry goals
  • Wireless broadband developments in Southeast Asia markets

    As of 2013, the 10 ASEAN nations had a total of over 700 million mobile subscriptions, with the CAGR from 2003-2013 reaching 24%. This Digitimes Research Special Report analyzes the various mobile broadband markets in ASEAN and looks at the respective trends in 4G LTE development for those markets.

  • 2015 global tablet demand forecast

    This Digitimes Research Special Report provides a 2015 forecast for the global tablet market and analyzes the strategies of key market players such as Google, Apple, Intel, and Microsoft.

  • 2015 China smartphone panel trend forecast

    This Digitimes Research Special Report analyzes the strategies of key China-based major panel makers BOE, Tianma and IVO for attacking the different market segments through technology and pricing, and their relationship to local vendors Huawei, Lenovo, ZTE, Xiaomi and Coolpad.