At the ongoing Computex 2013, a number of China-based companies including Malata, HKC Electronic, Hasee Computer and RightFriend Electronics Technology are showing their tablet products, competing for attention against Taiwan-based vendors such as Acer and Asustek Computer, both of whom have just launched several new tablets models.
The tablet market is growing fast. But as tablets are among devices with a low technology threshold, competition is fierce, particularly in the entry-level segment where many China-based white-box manufacturers offer products highly similar to each other.
Margins for such low-price tablets are naturally low, but this is not deterring brand vendors from competing with white-box makers in the entry-level segment.
Acer, Asustek and Lenovo: All gearing up for the tablet market boom in China
Acer, Asustek and their China-based rival Lenovo have introduced new tablets targeted at the entry-level market segment, with prices low enough to compete with those made by China-based white-box manufacturers.
These brand vendors' presence is very likely to cause a market reshuffle in the second half of 2013, and is also encouraging China's white-box manufacturers to introduce quad-core models ahead of schedule in order to enhance their appeal to consumers and defend their market share.
Asustek has unveiled a 7-inch tablet running Google's Android that will go on sale starting at US$129. Acer has also announced an updated version of its previously-launched budget tablet. Both devices feature a quad-core processor.
Asustek has set a target of shipping 12 million tablets in 2013, while Acer expects its tablet shipments for the year to reach 10 million units.
Earlier in 2013, Lenovo announced a line-up of new Android tablets powered by MediaTek's quad-core processors.
Competition from these brand-name PC brands in the budget tablet market will come as a blow to China-based white-box manufacturers' shipments in the second half of 2013, according to sources at chip suppliers.
The sources disclosed that previous estimates for tablet IC shipments to China's white-box vendors were optimistically put at 100 million units this year, but the volume is now expected to reach only 80-90 million units because shipments will start dropping in September.
In addition, dual-core processors remain the mainstream spec for tablets produced by the white-box players, the sources revealed. The sources estimated that about 70% of the total multi-core tablets shipped by China's white-box makers will feature dual-core chips at the end of the third quarter, while quad-core models account for 30%. About 20% of all tablets shipped by the white-box companies are powered by a single-core processor, the sources added.
Competition in China tablet-IC market heating up
The tablet-IC market in China is dominated by local SoC developers, which mainly adopt the ARM architecture enabling a low-cost and easy-to-design platform. With the entry of MediaTek, competition in the market is set to be fierce in 2013.
Rockchip Technology and Allwinner Technology still own a majority of China's tablet-IC market. The pair has released their quad-core solutions to stay competitive. Rockchip in December 2012 launched its quad-core solutions with attractive prices, which has helped it ship a total of 1.3 million chips for new quad-core tablets.
However, Taiwan-based MediaTek has been ramping up its shipments to white-box tablet manufacturers in China. MediaTek also adopts ARM-based solutions for tablets.
MediaTek knows the China market quite well, already having a dominant share of China's smartphone IC market. Its entry into the tablet segment is sending shockwaves across China's local tablet processor sector.
MediaTek shipments for tablets to jump in 2013
Shipments of MediaTek's system-on-chip (SoC) solutions used in tablets are set to enjoy significant growth in 2013, thanks to a pull-in of orders from China's white-box companies, according to industry observers.
MediaTek is forecast to ship a total of 20 million tablet solutions in 2013, up ten-fold from 2012, beating the company's projection given previously, said the observers.
MediaTek indicated earlier that its 2013 shipment target for tablet chipsets had been revised to 10-15 million units from the 5-10 million units set previously. The firm has not given another revision since.
MediaTek's recent acquisition of MStar Semiconductor has further enhanced its R&D capabilities, the observers pointed out. MediaTek's R&D team has now approached a size of 10,000, the observers said. MediaTek has just announced a new quad-core application processor intended for tablets to demonstrate its improved R&D.
Named MT8125, the new MediaTek quad-core processor is built based on the ARM Cortex A7 with speeds up to 1.5GHz, and includes new PowerVR Series5XT graphics. The SoC also offers a 4-in-1 chip that combines FM, GPS, Wi-Fi and Bluetooth 4.0.
With the new MT8125 solution, MediaTek has entered the supply chain of Lenovo, Acer and Asustek Computer, the observers revealed.
Following the MT8125 launch, MediaTek is expected to roll out another tablet-focused quad-core processor with enhanced performance and low power later in 2013, the observers disclosed.
In response, MediaTek said that the upcoming MT8135 chip will be based on ARM's big.LITTLE architecture with improved GPU power by Imagination's Series-6 core. With its better overall performance and support for high-resolution screens and low power consumption, the enhanced MT8135 version is attracting more customers than the recently-launched MT8125, MediaTek noted.
The upcoming availability of MediaTek's MT8135 solution will further boost the company's presence in the tablet field during the second half of 2013, market sources generally believe. Moreover, the firm is likely to introduce two to three chip solutions intended for tablets in early 2014.
MediaTek is expected to grab an almost 15% share of the tablet-IC market worldwide in 2013, compared to less than 3% in 2012, according to the sources.
A China-made tablet
Photo: Max Wang, Digitimes, June 2013
Article translated by Jessie Shen
