Mobile phones are about to see more price cuts

Mobile phone providers are expected to continue lowering prices of new models to stimulate demand during 2019.

Mobile phones in 2019 will be cheaper

This is bad news for chipmakers like Qualcomm, MediaTek or UNISOC, who will see their gross margins and profit capabilities undercut by the new marketing practice of device providers.

According to Digitimes , smartphone vendors have been forced to either sell high-end models at mid-priced or adopt high-end chips for mid-range models, in order to effectively drive users to upgrade their phones.

Chip makers will shorten the life cycles of their chips, reduce profitability and lower the market status of their high-end mobile SoCs and flagships.

For example, Qualcomm now offers Snapdragon 8, 7, 6 and 4 series mobile platforms to meet the demand of global providers of high, medium and low-end smartphones.

Qualcomm, MediaTek and UNISOC the most affected. Users are the beneficiaries

In 2018, the chipmaker even launched the Snapdragon 7 series and incorporated new AI capabilities into its Snapdragon 6 series in line with Chinese vendors selling high-end models at lower-than-expected prices.

Chinese vendors increasingly adopted Snapdragon 6 and 7 series SoCs for new low-end mobile phone models priced at around $ 432 and even applied Snapdragon 8 series to new mid-range models.

Snapdragon 8-series platforms are estimated to account for half to 70% of the value of Qualcomm's annual mobile SoC production for 2019; The chipmaker will feel an increasing impact from the latest vendor marketing trends.

Meanwhile MediaTek has Helio P60, P70, P22 and A22 chips that are focused on mid-range and low-end smartphones.

Things are clear, smartphone users aren't as enthusiastic about updating their phones as quickly, when a mid-range or high-end phone from two or three years ago still works very well.

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