According to the report from Reuters, Xiaomi will design their own processor for Redmi series. They are targeting to start adopt that processor in the second half of 2017. This is the same strategy done by Apple since 2010, where their iPhone 4 was released with their own processor. Samsung and Huawei has also done the same thing by designing and producing mobile processor, Exynos and Kirin.
If this report is true, the analysts predict, the companies who are currently cooperating with Xiaomi, such as Qualcomm and MediaTek will get a pressure. These two companies have supplied Xiaomi processor in huge number. For example, in the last year, MediaTek supplied 20 million processors for Xiaomi. Moreover, MediaTek responds this report by saying that this strategy will cost a lot of money if the volume of production is not equal to the research they have done.
“Designing chips in-house actually costs more if the scale of smartphone vendors is not enough to support the cost of R&D,” Taiwan-based MediaTek said. “In the end, they still have to outsource that to professional chip suppliers.”
This Xiaomi step is in line with the government of China to cut the dependency toward mobile production from foreign manufacturers. Beside to support the government policy, they also can maintain the market share and margins on a though competition, as it’s said by the analysts. To realize this new strategy, Xiaomi has to hire at least 200 – 300 people on a special facility in Nanjing, Shanghai and Beijing.
At this point, there is no information about the name of that processor and its advantages to be able to compete with the other processor.
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