China, and even India, have been embracing their own home-grown companies. With India having their “Made in India” program which is opening up a lot of jobs from tech companies like Xiaomi, Meizu and OnePlus. China has also been looking to get more semiconductors made in the country, to keep their reliance off of other countries like the US, where Qualcomm is based and is one of the leaders for semiconductors, along with Samsung and MediaTek. China, who has the world’s second largest economy, now has 9 companies that supply chips to the global top 50, compared to just one in 2009.
Hisilicon and Spreadtrum based in China have been rising in recent years and have given their economy plenty of push. The government is throwing money at home-grown technology companies, in an effort to reduce cyber security risks. Which is exactly what has made it tough for US firms to make their way into the country and actually make a profit. In fact, Qualcomm has even come out recently and said that licensing delays have occurred in China, costing them money. Reports from the IC also indicate that sales at Chinese designers are said to surge this year, with some seeing increases as high as 40%. Which would surely raise their market share above the 20% that they currently have in the market.
While Chinese chip designers do lag behind the top dogs in the industry (i.e. Qualcomm, NVIDIA, Exynos and MediaTek) by about 4-5 years. They do have the ability to really disrupt the industry. With China being such a large market in mobile – currently the largest market – and also selling their chips for less than their rivals. China is also said to be seizing about $20 billion of the chip industry from Taiwan in 2015, according to analysts.
China is known for their cheap products. While they may not always feel or look cheap, the price is surely cheap. Many smartphone makers sell their products in China at cost, and having them built in China means that they can be sold even cheaper than in other countries. Which is what makes it tough for companies outside of China to compete with companies based in the country.