MediaTek chip & Android smartphone

Is Samsung planning to use MediaTek SoCs?

During a recent tech forum, there was an interesting comment made by MediaTek Chairman Tsai Ming-kai, that could turn out to be a revealing slip of the tongue. Speaking with Journalists, Tsai seemingly confirmed that MediaTek has won business from Samsung.

Tsai made the remark when asked to comment on the recent battery explosions that have afflicted Samsung Galaxy Note7 smartphones.

“It is not possible for me to comment on [Samsung Note 7 battery defects] as Samsung is a customer,” he said.

Samsung has traditionally used either its owns Exynos chipsets in smartphones, or system-on-chips from Qualcomm.

A deal with MediaTek would be something of a departure in strategy for Samsung, although Tsai did not specially say that it is SoCs that his company will be supplying to the South Korean electronics giant.

Nonetheless, an SoC supply deal with MediaTek could make sense, at least as far as low-end – and possibly some mid-range – smartphones are concerned.

MediaTek have a reputation for keeping costs low, and this is a potential outsourcing deal that could boost Samsung’s margins.

The market for affordable smartphones is highly competitive and profits have been squeezed in this sector for some time.

It is easy to see how a relationship between the two companies could prove mutually beneficial. MediaTek would gain a prestigious new customer, while Samsung would have the opportunity to improve its bottom line.

[via Nikkei]