It's not an ARM Market, it's a Qualcomm Market

No wonder Qualcomm is clobbering Intel in mobile. It's using the Intel playbook.

Credit: Image credit: flickr/jontintinjordan

Intel is enjoying some good news in the mobile space for once. Its Atom processor now powers Samsung's Galaxy Tab 10.3 tablet. Ok, that's one device. Next?

Well, not so fast. You see, the same strategy Intel has incorporated to lock up the PC and server space is being used by Qualcomm to lock up the device space, and it's working. Just as there isn't an Android market so much as it's a Samsung and others market, the chip space for devices is pretty much a Qualcomm et al market.

In smartphones, Samsung holds about half of the Android market, 18 percent of the tablet market and almost all of the Android profits. Strategy Analytics says Samsung has 95% of the Android phone market's operating profit. That's why I call it the Samsung market and not Android market.

In chips, it's pretty much the same with Qualcomm. Although none of the major chip analysts have actual numbers, due to the difficulty of tracking so many phones on the market, all you have to do is look at the list of phones in the Wikipedia entry for Snapdragon, Qualcomm's brand of ARM-based processors, to see how ubiquitous Qualcomm is.

Just as Intel locked up all of the key OEM relationships, Qualcomm has a similar position in smartphones and is expanding that into tablets. What little Windows RT effort still coming from Microsoft has been centered around Qualcomm processors.

So what does Qualcomm have going for it that other ARM vendors don't? For starters, it has focused extensively on integration and system-on-a-chip design. Qualcomm has been aggressively trying to integrate the cellular modem, Wi-Fi, bluetooth, GPS, and FM onto a single chip, and it has had this IP for several years.

Intel is only just getting into that space with the acquisitions of Infineon and ST-Ericsson's GPS business. It has some catching up to do.

Intel has spent much of its career on more and faster, while the SoC/embedded market is about more with less. So Intel has had to get power efficiency religion for its Atom chips, which it did. Now it needs to get that same efficiency on its other chips. Its Wi-Fi needs more power efficiency because right now it uses Texas Instrument Wi-Fi for its mobile devices.

Then there's rounding up the OEMs, and boy does Qualcomm have a lock. Just look at the Snapdragon 4 MSM8960 licensee list: It's in Samsung Galaxy S III, Asus Transformer Pad Infinity, BlackBerry Z10, HTC Droid Incredible 4G LTE, HTC One X, Motorola Droid Razr M, Nokia Lumia 820/920 and a whole lot more.

The potential for Intel to separate from the pack comes with the move to 14nm. Once it gets Atom SoCs down to 14nm, that means a whole lot more power efficiency. Qualcomm is fabless and dependent on TSMC for its chips, and TSMC dropped the ball on its move to 28nm last year. So it could come down to Intel once again vanquishes a competitor on its sheer ability to out-engineer and out-manufacture them.

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