Apple’s engineers custom designed the A4, A5, and A5X chips that are found inside their products. Samsung puts their own Exynos chips inside their smartphones and tablets. Back in February of this year, Huawei announced that they’re going to fit a custom chip inside their flagship Android device, the Ascend D1 Quad. This begs the question, when are others going to get in on the custom action? According to Unwired View, HTC is working together with ST-Ericsson on a custom chip that’s purpose built for low-end Android smartphones due to hit the market in 2013. We don’t know how much work HTC is actually going to do with regards to the chip design process, but something tells us that they’re going to do little, if anything, other than give ST-Ericsson a set of performance and power figures that they then have to build a product around. Looking at ST-Ericsson’s portfolio, the chip that’s likely being discussed is a variant of the U4500. Announced back in February of 2011, the U4500 combines a 1 GHz ARM Cortex A9 processor with an ARM Mali 400 GPU and an HSPA+ modem. There’s also WiFi/Bluetooth/GPS and even NFC support. Said chip is supposed to enable smartphones that cost around $100.
The bigger question is should smaller handset vendors start looking at custom silicon in order to further differentiate themselves? It doesn’t take a rocket scientist to see that the two most profitable companies right now, Apple and Samsung, are using their own in-house processors. Meanwhile, everyone else is trying to squeeze out a profit, while at the same time Qualcomm has broken records in terms of revenue and profits during the past two quarters. Put two and two together.
Are we saying that chips from companies like NVIDIA or Qualcomm aren’t competitive? Not at all, we’re just saying that they’re hurting the bottom line of the companies that use said solutions.