Samsung is reportedly considering using MediaTek’s Dimensity chipsets for its low-end Galaxy devices, according to a tweet by leaker Revegnus (via Wccftech). The leaker claims that MediaTek is offering Samsung special pricing to persuade it to adopt its chips, which could help Samsung boost its profit margins.
Samsung has been facing stiff competition from Chinese rivals like Xiaomi, Oppo, and Vivo, who have overtaken it in some markets. Samsung’s global smartphone market share dropped from 21.6% in 2020 to 15.7% in 2021, according to IDC. To regain its lost ground, Samsung needs to cut costs and offer more value to its customers, especially in the low-end and mid-range segments.
However, Samsung has a long-term supply agreement with Qualcomm, the leading chipmaker for high-end smartphones. This means that Samsung’s flagship and foldable phones, such as the Galaxy S Ultra and Galaxy Z series, will continue to use Qualcomm’s Snapdragon chips for the next few years. Qualcomm’s chips are known for their performance, power efficiency, and compatibility with 5G networks, but they are also expensive and in short supply due to the global chip shortage.
MediaTek, on the other hand, is a rising star in the chip industry, with a 37% market share in 2021, according to Counterpoint Research. MediaTek’s Dimensity chips are designed for 5G smartphones, and they offer competitive features and performance at lower prices than Qualcomm’s chips. MediaTek has been expanding its customer base, supplying chips to Xiaomi, Oppo, Vivo, Realme, Motorola, and LG, among others.
Revegnus suggests that MediaTek is trying to woo Samsung with attractive pricing for its Dimensity chips, hoping to get a foothold in Samsung’s low-end Galaxy phones, and possibly move up to the mid-range and flagship models in the future. Samsung may be tempted by this offer, as it could save money and increase its margins by using MediaTek’s chips instead of Qualcomm’s.
However, Samsung has another option: its own Exynos chips. Samsung has been developing its own chipsets for years, and it has recently made significant improvements in its Exynos line. The Exynos 2400 SoC, which powers the Galaxy S24 and Galaxy S24+ in most markets outside of the U.S. and China, is a deca-core chip that rivals the Snapdragon 8 Gen 3 AP in benchmark scores. Samsung may decide to use its own Exynos chips for its high-end phones, and reserve Qualcomm’s chips for its foldable phones, which require more advanced technology.
The decision is not easy for Samsung, as it has to balance the factors of performance, power efficiency, 5G compatibility, cost, and supply. If Revegnus is right, we may soon see more Galaxy phones with MediaTek’s Dimensity chips, especially in the low-end segment. But whether MediaTek can convince Samsung to switch to its chips for its pricier smartphones remains to be seen. The chip war is heating up, and pricing may be the key to winning it.