Over the past 18 months, we have seen the battle for smartphone processor supremacy accelerate so rapidly that it is reminiscent of the PC processor wars.
Each company continues to up the ante with faster processors, more processor cores, higher performing GPUs, advanced features, and higher levels of integration. All of these elements are required to win the performance crown, but not necessarily for market share dominance.
According to NPD In-Stat, the Android portion of the low-cost smartphone segment will grow from just 4.7 percent of the total smartphone market in 2011 to 33.6 percent of the total market and 54.2 percent of the Android market in 2015.
With a CAGR of 100.3 percent, this low-cost segment would not only be the fastest growing portion of the smartphone segment, but the entire consumer electronics market. However, to reach an unsubsidized sub-$100 target price requires a total bill-of-materials, including IP licensing, below $60. This creates pricing pressure on all the major system component manufacturers, particularly the display and processor vendors.
As the market develops for low-cost smartphones, so too are the options for low-cost processors that can still run the desired smartphone operating systems like Google’s latest version of Android called Ice Cream Sandwich.
While companies like Qualcomm, Nvidia, TI, and Samsung battle for the high-performance segment of the market, many other vendors and start-ups are looking to satisfy the low-cost/high-volume segment.
MediaTek and Spreadtrum, for example, have both recently introduced new products targeting this segment. MediaTek announced the MT6575, which features a 1GHz ARM Cortex-A9 processor core with an Imagination PowerVR GPU, and Spreadtrum announced the SC8810 and SC6820 processors featuring 1GHz Cortex-A5 processor cores combined with ARM’s Mali-400 GPU.
While these processors and offerings from other processor vendors vary in terms of the processor core and GPU technologies, some similarities are emerging. The baseline for CPU appears to be a single core ARM processor operating at a 1GHz frequency, which is also on the low-end of the frequency range of most current multi-core mobile processors.
There is also the use of a programmable GPU like those offered by ARM, DMP, Imagination, and Vivante rather than fixed-function circuitry often used in baseband processors or MCUs. Most of these devices are also being produced on mature 40nm process technologies rather than the bleeding edge 28-nm technology. And, the primary market targeted for these products is China with added potential in other emerging markets.
While it may be possible for the technology leaders to target the low-cost smartphone segment with their dual-core 28-nm devices, the margins will likely preclude using the latest technology. In addition, one need only look at Apple in this segment to see the direction of things to come. Apple is offering the older generation iPhone 3GS for free through subsidized pricing in the US. The iPhone 3GS uses the A4 processor featuring a single 1GHz Cortex-A8 processor core combined with an Imagination PowerVR GPU.
While Apple is focused more on migrating to the next-generation solution and not on the low-end of the market, the reduced pricing does set precedence in the market for smartphones and marks an ominous sign for the future.
With the mobile industry’s major tradeshow, Mobile World Congress, in just a few weeks, it is reasonable to expect that we will hear more about semiconductor plans to target the low-cost smartphone segment, as well as new lines of low-cost smartphones that are not primarily aimed at the North America and Europe.