Industry sources shared with DigiTimes that Qualcomm and Mediatek have both transferred some of their 28nm chip production from TSMC to cheaper foundries like UMC, GlobalFoundries and SMIC. The site explains falling prices of smartphones are urging chip designers to look for cheaper alternatives:
In the face of strong competition in China's smartphone-chip market, Qualcomm and MediaTek are looking for alternatives to TSMC, which is standing firm on prices, said the sources.
Prices for entry-level and mid-range smartphone ICs have fallen over 20% in the past year, prompting chip providers to approach second-source suppliers to lower costs, the sources indicated.
In addition to pursuing lower manufacturing costs, Qualcomm and MediaTek intend to diversify their foundry sources to reduce their reliance on TSMC, the sources said. The two handset chip vendors previously experienced tight supply of 28nm chips from TSMC.