Demand For MediaTek Chips Increases Due To Chinese White Box Tablets With Phone Functions

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A tablet that can make phone calls isn’t something that is fairly common here in the states, but in China, manufacturers are making more and more white box tablets that have the capability to place phone calls. This is a trend that is starting to gain popularity in the region as more and more people find the functionality useful, and as a result MediaTek has seen a huge increase in demand for some of their chips from the beginning of the first quarter. The increase in white box tablet models with phone functions began seen more and more production as wifi only based white box tablets saw little profit for the region at the beginning of the year.

Not only has this increase in white box tablet sales driven a huge profit for MediaTek, it has also allowed MediaTek to gain some ground with the competition like Rockchip and Allwinners. White box tablet makers have actually been using MediaTek’s smartphone solutions within their tablets as early as 2012, and the steady increase of use of these smartphone solutions over time has lead to MediaTek making huge gains, however many of China’s independent design houses are able to purchase MediaTek’s smartphone solutions like the MT6572, MT6575 and MT6577  through unofficial means, and avoid paying licensing fees to MediaTek for the chips. The tablet makers are able to acquire them in such large quantities that they are able to produce many products that use these chips, which is predicted to cause more and more white box tablet makers that have yet to use any MediaTek hardware to come to the table which will ultimately lead to more benefits for MediaTek.

Even though MediaTek has lost out on some of the licensing fees due to the IDH, it is expected that it will cause them much more growth and the ability to ship more new products to new partners. MediaTek is expected to reach over 8 million in shipments of these chips that support the phone capabilities for white box tablets within the first quarter, and by the end of the second quarter they could end up shipping more than 12 million units. MediaTek has been a steady player in the chip market because of their low cost compared to other competitors in the region, and it’s because of this that they are expected to see a 10 percentage point increase in the white box tablet market this year, reaching a total of 25% share in that market.

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