If Apple was not already worried about the growing success of its rival Google’s Android platform, it certainly won’t like the news today that MediaTek is to release a flurry of cheap chipsets for Android-based smartphones in the third quarter of this year.
The Taiwanese chip manufacturer has the largest share of the mobile chip market in China and is hoping to continue its dominance by producing low-cost chipsets for Android. This will lead to a flood of new Android smartphones in the Chinese market, which will in turn lead to Google stealing more of Apple’s market share.
In early July MediaTek joined the Open Handset Alliance, a group of over 80 mobile operators, handset manufacturers, semiconductor companies, and software firms, all supporting the open source Android platform. It joined a number of high-profile companies including Acer, ARM, Dell, eBay, Google, HTC, Intel, Motorola, Samsung, and many more.
MediaTek made a similar deal with Microsoft earlier this year to produce cost-effective Windows Phone 7 smartphones. With both its rivals teaming up with Mediatek, Apple must be feeling the pressure to do something about its expensive iPhones, with many people being still unable to afford the older models.
In China it is more common to see iPhone knock-offs than the real thing. Cheap counterfeits are much more popular than the genuine expensive article, with expectations of 172 million units of knock-offs being shipped this year alone.
It is vital, therefore, that prices for the most expensive part of a phone, which is its chipset, are driven down, which will see more people buy the official device as opposed to grey-market copies.