MediaTek is at the lowest level since its establishment in 1997. Chairman Cai Mingjie has retired only one year behind the scenes and will have to return to the public to preside over the overall situation, dragging his thin body and running between the mainland brand mobile phone manufacturers and the copycat enterprises. .
Indulge in the glory achieved in the 2G era, MediaTek has made great strategic mistakes in 3G and smart phones, resulting in a sharp decline in revenue and net profit for four consecutive quarters. Today, Tsai Ming-Sai has felt that the high-end market in the all-round Chuge has suffered long-term attacks, and the low-end market has continued to fall.
MediaTek paid a heavy price for its own short-sightedness.
In the 14 years since its establishment, MediaTek has grown rapidly. However, this has become a thing of the past. Now, it is facing endless troubles.
On July 7, MediaTek announced its first-half results. During the period, it achieved NT$40.823 billion in revenue, which was a sharp drop of 34.84% year-on-year. When the entire IC industry sprang up, MediaTek’s report card was too sad.
In the high-end market, they lost to Western chip manufacturers such as Qualcomm, Broadcom, Texas Instruments, Infineon, etc.; in the low-end market, the strong impact of late-stage stars such as Spreadtrum and Morningstar did not allow for an optimistic situation, resulting in MediaTek’s ups and downs and injuries. And cohesion.
With the integration of disruptive innovations, MediaTek once monopolized 90% of the market share of GSM chips in the mainland and became the largest handset chip manufacturer in the world. However, due to uncertainties about future trends, MediaTek was at a loss when the 3G curtain was opened, and mistakenly chose the Microsoft platform on smart phones, which delayed it too much time.
Under tremendous pressure, MediaTek recently announced a "Smart Phone" solution in Shanghai, focusing on smart and non-intelligent middle market. Although this program can reduce the price of mobile phones and enrich applications, the current 1,000-yuan smart phones have become popular. This alternative solution is obviously difficult to win the favor of mainstream mobile phone manufacturers. What is even more unfavorable is that Qualcomm is also penetrating into the low-end market and MediaTek's future is worrying.
Encroaching on MediaTek's strong support from the copycat machine, in 2009, MediaTek entered its heyday, its chip market share in the mainland as high as 90%, shipments surpassed Qualcomm in one fell swoop, becoming the world's largest mobile phone chip maker.
However, it is extremely prosperous. In less than a year, MediaTek experienced an unprecedented crisis, with market share falling sharply, revenues slowing, and profits tumbled. In particular, Spreadtrum and Taiwan's IC makers such as Morningstar and other competitors in the low-end market forces, so that MediaTek feels pressure.
Industry analysts believe that the loss of MediaTek in the Chinese mobile phone chip market is due to the rise of Spreadtrum, which has broken its dominance. According to market research agency iSuppli, Spreadtrum’s 2G chip market share in the mainland was less than 5% in 2009, but it has now risen to 30%.
MediaTek is too impatient and has always wanted to catch up with Qualcomm. In 2009, MediaTek introduced the MT6253 chip. Although the performance was excellent, due to too great changes and high packaging requirements, the yield rate decreased. Spreadtrum successfully seized this opportunity to launch a high-quality, low-cost 2G chip in the same year, eroding some of MediaTek's market share with a good price/performance ratio and breaking into the supply system of Samsung, Motorola and other brand manufacturers. The mobile phone industry's profits have been repeatedly reduced, and mobile phone manufacturers are trying their best to control costs. In comparison, Spreadtrum’s mobile phone chip prices are lower, and quality is not much different from that of MediaTek. MediaTek’s high gross margin strategy makes it easy for Spreadtrum to break through the line of defense.
Interestingly, at a semiconductor conference in April this year, the organizers had arranged for Mediatek CEO Cai Mingjie and Spreadtrum’s CEO Li Liyou to have lunch, but the former avoided this opportunity.
The impact on MediaTek is not limited to Spreadtrum. In the low-end market, Morningstar is considered to be another tough competitor to MediaTek following the exhibition. It has recently gained momentum and has quickly eroded MediaTek’s share in the mainland market. It is reported that Morningstar has accounted for 5% of the mobile phone chip market share in the mainland, and is actively conducting research and development of 3G and smart phone chips.
MediaTek and Morningstar are two rivals, and they have formed a positive confrontation in various fields such as mobile phone chips and TV chips. According to media reports in Taiwan, Morningstar has used an aggressive approach to narrow the gap with MediaTek and obtained a large number of commercial secrets from MediaTek.
In May of this year, MediaTek accused two former employees of Jingfa Technology, a mobile phone design company and a partner of MediaTek, of divulging the important software and confidential information related to MediaTek. In the eyes of the outside world, MediaTek regards Morningstar as a strong competitor. The lawsuit is obviously to delay the offensive momentum of Morningstar.
Due to the crisis awareness, on June 28, many senior executives of MediaTek's general manager, deputy general managers, and deputy general managers of wireless communications gathered in Shanghai to hold a press conference to disclose the company's future product strategy and market direction. MediaTek also announced MT6236 solutions for smart phones and MT6573 solutions tailored for Android.
Strategic Mistakes Because Mediatek overly indulged in the success of 2G chips, it missed market opportunities in the 3G era and the wave of smart phones.
On July 18, China Unicom (600,050 shares) held a WCDMA terminal industry chain forum in Shanghai to encourage terminal manufacturers to produce more low-end and mid-range 3G mobile phones to expand the scale of users. Cai Mingjie attended the conference.
According to the data released by operators, as of June this year, China Unicom's 3G subscribers reached 23.945 million and China Telecom’s 3G subscribers had reached 21.54 million. However, in this wave of 3G wave, MediaTek basically became a spectator.
"MediaTek once had a 90% share in the mainland 2G market. This should be considered abnormal. Current share falls below 70%, but it is still a fairly high figure." Product Manager of a Shenzhen mobile phone maker "IT Times" He said that MediaTek's decline has had a great relationship with its failure to achieve good results in the 3G field.
At present, the core patents in this field are mainly concentrated in the hands of European and American companies. The operating system is dominated by Microsoft, Google, Apple, Blackberry, Nokia, etc. They are the makers of standards and game rules, and Mediatek’s turnkey model of the 2G era no longer works. .
In recent years, MediaTek has devoted almost all of its energy to the deployment of the 2G market, resulting in no accumulation in the 3G market, and the transformation pressure is very high. MediaTek executives also admitted that the company's layout in the area of ​​3G is somewhat late. "Our actions are indeed a bit late. There are many reasons for this. The most critical reason is that 3G chip technology is difficult, and the products we want to introduce are mature and stable, and therefore slower than expected." MediaTek Manager Xie Qingjiang said.
However, this is not enough to explain the reasons for MediaTek's backwardness in 3G. It is not too late for MediaTek to deploy the 3G market. It is a fact that many detours have been taken. "IT Times" reporter learned that, as early as in 2007, it acquired ADI's TD mobile phone solution division, the awareness of advance card position is very clear.
However, this acquisition did not bring true competitiveness to it. Most of the core technologies such as the protocol stack are in the hands of ADI's partners. The slow start of TD, but also to give competitors a full brewing time T3G and the new Marvell killed, they all grabbed the limelight of MediaTek.
To this end, in August last year, MediaTek had to spend 20 million US dollars to purchase Prudential, in order to obtain each other in the TD baseband chip field, including the core technology, including the protocol stack. In the eyes of people in the industry, MediaTek’s intention to shed its dependence on Lian Technology is obvious.
Now, unfavorable for MediaTek is that Qualcomm and other European and American competitors are eyeing the TD-LTE mobile phone chip market. With their entry, MediaTek's situation may become increasingly worrying.
In CDMA2000 and WCDMA, MediaTek is powerless because its core patents are all in the hands of European and American chip designers. Data show that in 2010, MediaTek mobile phone chip shipments reached 500 million, but WCDMA chip is only 1.1 million, almost negligible.
At the China Unicom WCDMA Terminal Industry Chain Forum on July 18, Cai Mingxian revealed that so far, MediaTek has launched several platform solutions for WCDMA standard, and has received ZTE Corporation (000063, stock), Lenovo, etc. Some manufacturers' big orders. However, MediaTek lacks the right to speak in this format, and its overall influence is limited.
More unfortunately, MediaTek is unresponsive in the field of smartphones. It targets the Microsoft platform and is a downright mistake. There is no matching smartphone solution on the Android platform, and its input is basically overdone. According to data from AiMedia, in 2010, shipments of the MediaTek platform for the Chinese market were 125 million units. However, with the development of branded mobile phones and Android open source system handsets, MediaTek’s platform mobile phone shipments will decline by approximately 15% in 2011, and shipments are expected to reach 106 million units.
On July 12 last year, MediaTek announced that it officially joined Google's "Open Handset Alliance," and will create MediaTek's "dedicated Android smart phone solution." MediaTek will copy the success previously achieved in the 2G era to Android smartphones. This integrated chip system solution can significantly reduce the technical threshold for mobile phone manufacturers, shorten the time to market, and reduce the cost of Android smartphones. 2/3.
Although MediaTek has realized the seriousness of the problem, it may be too late. The situation in the mobile phone industry today has undergone tremendous changes. Some industry observers believe that Qualcomm has already replicated MediaTek's model in the 3G smart phone field. With a small number of engineers, it can manufacture 3G Android mobile phones. Moreover, Qualcomm is also significantly reducing the price of 3G chips, from 15 US dollars per tablet in 2009 to the current 10 US dollars or less, to reduce the room for Mediation's 3G chip prices.
Military shake?
At the end of last year, Cai Mingjie personally oversaw the army and went to the front line to visit the mobile phone manufacturers with larger shipments in the Mainland, with the intention of regaining lost market share. Cai Ming Jie also asked the supervisor of the mobile phone department to report directly to him and solve the problems in time.
According to Taiwan’s local media reports, MediaTek’s internal communication is not smooth, and its execution is not strong enough to make Tsai Ming-keung extremely angry. The employees reported to the company’s headquarters early on, and the demand for three cards and three standbys in overseas markets such as India was strong, but the headquarters had been ignoring the news. As a result, the competitor’s communication was a priority.
MediaTek has lost the absolute status of China's 2G chip market. The high-end markets in Europe and America have yet to open the situation. The profitability of the company has continued to drop substantially. How can such a crisis situation reunite people? Tsai Ming-Ji’s operational capabilities have stood the test.
As high dividends are no longer required and internal concepts diverge, MediaTek began turbulence in the second half of last year. On October 18 last year, Xu Zhiqiang, former boss of MediaTek’s original mobile phone division, resigned. This is like a blockbuster in the IC industry.
MediaTek can have today's achievements, and Xu Zhiqiang is doing a great job. He is also a veteran of MediaTek. In 1999, Cai Mingjie dug Xu Zhiqiang and invested in the research and development of mobile phone chips. In 2009, Xu Xiaomei was promoted by Cai Mingjie as head of the mobile phone chip division, which is the most important division of MediaTek. Cai Ming Jie returned to the scene.
It is rumored in the industry that Xu's departure was due to the fact that his power was high. Xu is closely associated with major mainland mobile phone brands. Under his lobbying, many unknown mobile phone manufacturers (including small-scale cottage machine manufacturers) have defected to MediaTek. In August 2010, after the publication of the bad first-half results, Cai Ming Jie retired from the second line and regained the power in his hands. This forced Xu Zhiqiang to retire.
The departure of Xu Zhiqiang opened the prelude to the company's high-level job-hopping. The reporter learned that from October last year to April this year, MediaTek replaced three general managers in only half a year. Together with Yu Minghao, the chief financial officer who left at the end of last year, and Chen Jiazhong, director of the human resources department, MediaTek experienced a Personnel earthquakes, the outside world even described it as MediaTek's “heart shake.â€
In April of this year, Lin Yanfu, the person in charge of MediaTek's mainland, left the company on grounds of poor health. A person in charge of a mobile phone manufacturer in Shenzhen told reporters in the “IT Times†magazine that Lin Yanyi was the general manager of MediaTek in the Mainland. His previous achievements were obvious to all. When leaving this office, it was easy to raise suspicions. In his view, "poor health" is only an excuse. The company's top executives have been dissatisfied with the limelight by the exhibition news in mainland China, which is the main reason.
Tsai Ming-kai was also very dissatisfied with the management of the company and believed that they had underestimated the enemy and gave the competitor a chance to take advantage. Towards this end, at the end of last year, Cai Mingjie shouted the slogan of “regaining entrepreneurial spirit†at a conference and asked employees to work hard and not be lax.
According to MediaTek insiders, at the end of last year, after the substitution of the company’s mobile phone division chief, the internal and external factions were serious. As a result, more than 100 R&D engineers submitted their resignations, which caused a lot of turmoil in the industry. And these resigned employees, some of whom have gone to rival Broadcom's Taiwanese company.
The rapid development of MediaTek in the past few years relies on the fact that high dividends attract high-quality talent. However, as profits decline, it is expected that dividends will drop sharply. In the event of sluggish performance, MediaTek can retain talents. It is indeed a doubt.
A manager of MediaTek, who declined to be named, disclosed to IT Times that due to the current crisis situation, Cai Mingjie focused on the transformation of the organization. With the loss of high-level and core technical talents, he is looking for talent around the company to supplement and update the blood.
Cai Mingzhong dug out from the IBM last year, Qiu Hui, responsible for the implementation of the company's strategy. Qiu Hui is an old IBM employee and has assisted IBM’s former CEO Gerstner. Today's MediaTek is quite similar to IBM in the early 1990s. Cai Mingjie hired Qiu Hui and obviously asked him to help the company in strategic transformation. In addition, MediaTek also dug out the backbone of technology from Qualcomm, hoping to make breakthroughs in the high-end market and take off the “cottage†cap.
Obscure future In order to get rid of the dilemma of 2G mobile phone market, MediaTek began to actively enter the smart phone field. However, the complexity of smartphone hardware and software is relatively high, and smart phones are in an outbreak period, in order to catch up with Broadcom in the shortest possible time. Qualcomm's technical standards, direct mergers and acquisitions is undoubtedly the fastest way for MediaTek.
In March of this year, MediaTek took shares of Ralink Technologies, a chip company, in exchange for shares and hopes to make up for its shortcomings in the fields of smartphones, PCs and tablet computers. This purchase is expected to be officially completed on October 1 this year.
According to Xie Qingjiang, General Manager of MediaTek, through the acquisition of the Leiling team, not only can a group of outstanding technical talents be available, but it can also provide MediaTek with more extensive chip solutions. The application of Ralink Technology covers PCs, Internet TVs, Blu-ray players, game consoles, tablet PCs and smart phones, which will greatly enrich MediaTek's product line.
In order to make up for the shortcomings of smart phones, MediaTek also came up with an alternative plan to launch an intermediate software platform MRE and new chip products to enable ordinary 2G mobile phones to have "class smart phones". According to MediaTek, it is located between smart phones and feature phones, and uses a semi-open platform to enable user experiences like Internet access and similar smartphones.
MediaTek's concept of "class smart phones" was introduced to the world, and the industry's failure has never been interrupted. However, MediaTek is very optimistic about this new chip solution and believes that it will be able to distinguish itself from competitors such as Spreadtrum and Morningstar.
Xie Qingjiang is full of confidence in "class smart phones." He believes that although the current 3G smart phone shipments rose sharply, but from the market point of view, the demand for feature phones is far more than smart phones. MediaTek's latest product solutions will provide smart phone operating experience for feature phones such as Internet access, large-screen full touch, and software download.
Ideal is full, the reality is very skinny. Since last year, the three major operators in China have been pushing thousands of smartphones. Huawei, ZTE, Coolpad and others have launched a large number of thousand smartphones and have already pushed prices down. In the view of industry professionals, MediaTek's castrated solution is difficult to gain recognition from domestic first-tier manufacturers.
According to reports, MediaTek's "class smart phones" do not have 3G capabilities and do not support Android, and the chip's main frequency is too low to carry some large-scale applications. Although this kind of mobile phone is very cheap, but in fact does not have the difference with the ordinary functional mobile phone very much, it is difficult to arouse the consumer to purchase the desire.
In recent years, MediaTek has been seeking business transformation. It has already entered the TV chip market and has become a core supplier. In the eyes of the industry, this move is expected to ease the pressure on MediaTek to fall into the 2G market. However, in the short term, MediaTek’s revenue of about 70% will still come from the 2G chip business, and 3G chips will have to be mass-produced. It is estimated that it will wait until next year. Therefore, the external expectations of MediaTek's performance in the next few quarters are not optimistic.
Indulge in the glory achieved in the 2G era, MediaTek has made great strategic mistakes in 3G and smart phones, resulting in a sharp decline in revenue and net profit for four consecutive quarters. Today, Tsai Ming-Sai has felt that the high-end market in the all-round Chuge has suffered long-term attacks, and the low-end market has continued to fall.
MediaTek paid a heavy price for its own short-sightedness.
In the 14 years since its establishment, MediaTek has grown rapidly. However, this has become a thing of the past. Now, it is facing endless troubles.
On July 7, MediaTek announced its first-half results. During the period, it achieved NT$40.823 billion in revenue, which was a sharp drop of 34.84% year-on-year. When the entire IC industry sprang up, MediaTek’s report card was too sad.
In the high-end market, they lost to Western chip manufacturers such as Qualcomm, Broadcom, Texas Instruments, Infineon, etc.; in the low-end market, the strong impact of late-stage stars such as Spreadtrum and Morningstar did not allow for an optimistic situation, resulting in MediaTek’s ups and downs and injuries. And cohesion.
With the integration of disruptive innovations, MediaTek once monopolized 90% of the market share of GSM chips in the mainland and became the largest handset chip manufacturer in the world. However, due to uncertainties about future trends, MediaTek was at a loss when the 3G curtain was opened, and mistakenly chose the Microsoft platform on smart phones, which delayed it too much time.
Under tremendous pressure, MediaTek recently announced a "Smart Phone" solution in Shanghai, focusing on smart and non-intelligent middle market. Although this program can reduce the price of mobile phones and enrich applications, the current 1,000-yuan smart phones have become popular. This alternative solution is obviously difficult to win the favor of mainstream mobile phone manufacturers. What is even more unfavorable is that Qualcomm is also penetrating into the low-end market and MediaTek's future is worrying.
Encroaching on MediaTek's strong support from the copycat machine, in 2009, MediaTek entered its heyday, its chip market share in the mainland as high as 90%, shipments surpassed Qualcomm in one fell swoop, becoming the world's largest mobile phone chip maker.
However, it is extremely prosperous. In less than a year, MediaTek experienced an unprecedented crisis, with market share falling sharply, revenues slowing, and profits tumbled. In particular, Spreadtrum and Taiwan's IC makers such as Morningstar and other competitors in the low-end market forces, so that MediaTek feels pressure.
Industry analysts believe that the loss of MediaTek in the Chinese mobile phone chip market is due to the rise of Spreadtrum, which has broken its dominance. According to market research agency iSuppli, Spreadtrum’s 2G chip market share in the mainland was less than 5% in 2009, but it has now risen to 30%.
MediaTek is too impatient and has always wanted to catch up with Qualcomm. In 2009, MediaTek introduced the MT6253 chip. Although the performance was excellent, due to too great changes and high packaging requirements, the yield rate decreased. Spreadtrum successfully seized this opportunity to launch a high-quality, low-cost 2G chip in the same year, eroding some of MediaTek's market share with a good price/performance ratio and breaking into the supply system of Samsung, Motorola and other brand manufacturers. The mobile phone industry's profits have been repeatedly reduced, and mobile phone manufacturers are trying their best to control costs. In comparison, Spreadtrum’s mobile phone chip prices are lower, and quality is not much different from that of MediaTek. MediaTek’s high gross margin strategy makes it easy for Spreadtrum to break through the line of defense.
Interestingly, at a semiconductor conference in April this year, the organizers had arranged for Mediatek CEO Cai Mingjie and Spreadtrum’s CEO Li Liyou to have lunch, but the former avoided this opportunity.
The impact on MediaTek is not limited to Spreadtrum. In the low-end market, Morningstar is considered to be another tough competitor to MediaTek following the exhibition. It has recently gained momentum and has quickly eroded MediaTek’s share in the mainland market. It is reported that Morningstar has accounted for 5% of the mobile phone chip market share in the mainland, and is actively conducting research and development of 3G and smart phone chips.
MediaTek and Morningstar are two rivals, and they have formed a positive confrontation in various fields such as mobile phone chips and TV chips. According to media reports in Taiwan, Morningstar has used an aggressive approach to narrow the gap with MediaTek and obtained a large number of commercial secrets from MediaTek.
In May of this year, MediaTek accused two former employees of Jingfa Technology, a mobile phone design company and a partner of MediaTek, of divulging the important software and confidential information related to MediaTek. In the eyes of the outside world, MediaTek regards Morningstar as a strong competitor. The lawsuit is obviously to delay the offensive momentum of Morningstar.
Due to the crisis awareness, on June 28, many senior executives of MediaTek's general manager, deputy general managers, and deputy general managers of wireless communications gathered in Shanghai to hold a press conference to disclose the company's future product strategy and market direction. MediaTek also announced MT6236 solutions for smart phones and MT6573 solutions tailored for Android.
Strategic Mistakes Because Mediatek overly indulged in the success of 2G chips, it missed market opportunities in the 3G era and the wave of smart phones.
On July 18, China Unicom (600,050 shares) held a WCDMA terminal industry chain forum in Shanghai to encourage terminal manufacturers to produce more low-end and mid-range 3G mobile phones to expand the scale of users. Cai Mingjie attended the conference.
According to the data released by operators, as of June this year, China Unicom's 3G subscribers reached 23.945 million and China Telecom’s 3G subscribers had reached 21.54 million. However, in this wave of 3G wave, MediaTek basically became a spectator.
"MediaTek once had a 90% share in the mainland 2G market. This should be considered abnormal. Current share falls below 70%, but it is still a fairly high figure." Product Manager of a Shenzhen mobile phone maker "IT Times" He said that MediaTek's decline has had a great relationship with its failure to achieve good results in the 3G field.
At present, the core patents in this field are mainly concentrated in the hands of European and American companies. The operating system is dominated by Microsoft, Google, Apple, Blackberry, Nokia, etc. They are the makers of standards and game rules, and Mediatek’s turnkey model of the 2G era no longer works. .
In recent years, MediaTek has devoted almost all of its energy to the deployment of the 2G market, resulting in no accumulation in the 3G market, and the transformation pressure is very high. MediaTek executives also admitted that the company's layout in the area of ​​3G is somewhat late. "Our actions are indeed a bit late. There are many reasons for this. The most critical reason is that 3G chip technology is difficult, and the products we want to introduce are mature and stable, and therefore slower than expected." MediaTek Manager Xie Qingjiang said.
However, this is not enough to explain the reasons for MediaTek's backwardness in 3G. It is not too late for MediaTek to deploy the 3G market. It is a fact that many detours have been taken. "IT Times" reporter learned that, as early as in 2007, it acquired ADI's TD mobile phone solution division, the awareness of advance card position is very clear.
However, this acquisition did not bring true competitiveness to it. Most of the core technologies such as the protocol stack are in the hands of ADI's partners. The slow start of TD, but also to give competitors a full brewing time T3G and the new Marvell killed, they all grabbed the limelight of MediaTek.
To this end, in August last year, MediaTek had to spend 20 million US dollars to purchase Prudential, in order to obtain each other in the TD baseband chip field, including the core technology, including the protocol stack. In the eyes of people in the industry, MediaTek’s intention to shed its dependence on Lian Technology is obvious.
Now, unfavorable for MediaTek is that Qualcomm and other European and American competitors are eyeing the TD-LTE mobile phone chip market. With their entry, MediaTek's situation may become increasingly worrying.
In CDMA2000 and WCDMA, MediaTek is powerless because its core patents are all in the hands of European and American chip designers. Data show that in 2010, MediaTek mobile phone chip shipments reached 500 million, but WCDMA chip is only 1.1 million, almost negligible.
At the China Unicom WCDMA Terminal Industry Chain Forum on July 18, Cai Mingxian revealed that so far, MediaTek has launched several platform solutions for WCDMA standard, and has received ZTE Corporation (000063, stock), Lenovo, etc. Some manufacturers' big orders. However, MediaTek lacks the right to speak in this format, and its overall influence is limited.
More unfortunately, MediaTek is unresponsive in the field of smartphones. It targets the Microsoft platform and is a downright mistake. There is no matching smartphone solution on the Android platform, and its input is basically overdone. According to data from AiMedia, in 2010, shipments of the MediaTek platform for the Chinese market were 125 million units. However, with the development of branded mobile phones and Android open source system handsets, MediaTek’s platform mobile phone shipments will decline by approximately 15% in 2011, and shipments are expected to reach 106 million units.
On July 12 last year, MediaTek announced that it officially joined Google's "Open Handset Alliance," and will create MediaTek's "dedicated Android smart phone solution." MediaTek will copy the success previously achieved in the 2G era to Android smartphones. This integrated chip system solution can significantly reduce the technical threshold for mobile phone manufacturers, shorten the time to market, and reduce the cost of Android smartphones. 2/3.
Although MediaTek has realized the seriousness of the problem, it may be too late. The situation in the mobile phone industry today has undergone tremendous changes. Some industry observers believe that Qualcomm has already replicated MediaTek's model in the 3G smart phone field. With a small number of engineers, it can manufacture 3G Android mobile phones. Moreover, Qualcomm is also significantly reducing the price of 3G chips, from 15 US dollars per tablet in 2009 to the current 10 US dollars or less, to reduce the room for Mediation's 3G chip prices.
Military shake?
At the end of last year, Cai Mingjie personally oversaw the army and went to the front line to visit the mobile phone manufacturers with larger shipments in the Mainland, with the intention of regaining lost market share. Cai Ming Jie also asked the supervisor of the mobile phone department to report directly to him and solve the problems in time.
According to Taiwan’s local media reports, MediaTek’s internal communication is not smooth, and its execution is not strong enough to make Tsai Ming-keung extremely angry. The employees reported to the company’s headquarters early on, and the demand for three cards and three standbys in overseas markets such as India was strong, but the headquarters had been ignoring the news. As a result, the competitor’s communication was a priority.
MediaTek has lost the absolute status of China's 2G chip market. The high-end markets in Europe and America have yet to open the situation. The profitability of the company has continued to drop substantially. How can such a crisis situation reunite people? Tsai Ming-Ji’s operational capabilities have stood the test.
As high dividends are no longer required and internal concepts diverge, MediaTek began turbulence in the second half of last year. On October 18 last year, Xu Zhiqiang, former boss of MediaTek’s original mobile phone division, resigned. This is like a blockbuster in the IC industry.
MediaTek can have today's achievements, and Xu Zhiqiang is doing a great job. He is also a veteran of MediaTek. In 1999, Cai Mingjie dug Xu Zhiqiang and invested in the research and development of mobile phone chips. In 2009, Xu Xiaomei was promoted by Cai Mingjie as head of the mobile phone chip division, which is the most important division of MediaTek. Cai Ming Jie returned to the scene.
It is rumored in the industry that Xu's departure was due to the fact that his power was high. Xu is closely associated with major mainland mobile phone brands. Under his lobbying, many unknown mobile phone manufacturers (including small-scale cottage machine manufacturers) have defected to MediaTek. In August 2010, after the publication of the bad first-half results, Cai Ming Jie retired from the second line and regained the power in his hands. This forced Xu Zhiqiang to retire.
The departure of Xu Zhiqiang opened the prelude to the company's high-level job-hopping. The reporter learned that from October last year to April this year, MediaTek replaced three general managers in only half a year. Together with Yu Minghao, the chief financial officer who left at the end of last year, and Chen Jiazhong, director of the human resources department, MediaTek experienced a Personnel earthquakes, the outside world even described it as MediaTek's “heart shake.â€
In April of this year, Lin Yanfu, the person in charge of MediaTek's mainland, left the company on grounds of poor health. A person in charge of a mobile phone manufacturer in Shenzhen told reporters in the “IT Times†magazine that Lin Yanyi was the general manager of MediaTek in the Mainland. His previous achievements were obvious to all. When leaving this office, it was easy to raise suspicions. In his view, "poor health" is only an excuse. The company's top executives have been dissatisfied with the limelight by the exhibition news in mainland China, which is the main reason.
Tsai Ming-kai was also very dissatisfied with the management of the company and believed that they had underestimated the enemy and gave the competitor a chance to take advantage. Towards this end, at the end of last year, Cai Mingjie shouted the slogan of “regaining entrepreneurial spirit†at a conference and asked employees to work hard and not be lax.
According to MediaTek insiders, at the end of last year, after the substitution of the company’s mobile phone division chief, the internal and external factions were serious. As a result, more than 100 R&D engineers submitted their resignations, which caused a lot of turmoil in the industry. And these resigned employees, some of whom have gone to rival Broadcom's Taiwanese company.
The rapid development of MediaTek in the past few years relies on the fact that high dividends attract high-quality talent. However, as profits decline, it is expected that dividends will drop sharply. In the event of sluggish performance, MediaTek can retain talents. It is indeed a doubt.
A manager of MediaTek, who declined to be named, disclosed to IT Times that due to the current crisis situation, Cai Mingjie focused on the transformation of the organization. With the loss of high-level and core technical talents, he is looking for talent around the company to supplement and update the blood.
Cai Mingzhong dug out from the IBM last year, Qiu Hui, responsible for the implementation of the company's strategy. Qiu Hui is an old IBM employee and has assisted IBM’s former CEO Gerstner. Today's MediaTek is quite similar to IBM in the early 1990s. Cai Mingjie hired Qiu Hui and obviously asked him to help the company in strategic transformation. In addition, MediaTek also dug out the backbone of technology from Qualcomm, hoping to make breakthroughs in the high-end market and take off the “cottage†cap.
Obscure future In order to get rid of the dilemma of 2G mobile phone market, MediaTek began to actively enter the smart phone field. However, the complexity of smartphone hardware and software is relatively high, and smart phones are in an outbreak period, in order to catch up with Broadcom in the shortest possible time. Qualcomm's technical standards, direct mergers and acquisitions is undoubtedly the fastest way for MediaTek.
In March of this year, MediaTek took shares of Ralink Technologies, a chip company, in exchange for shares and hopes to make up for its shortcomings in the fields of smartphones, PCs and tablet computers. This purchase is expected to be officially completed on October 1 this year.
According to Xie Qingjiang, General Manager of MediaTek, through the acquisition of the Leiling team, not only can a group of outstanding technical talents be available, but it can also provide MediaTek with more extensive chip solutions. The application of Ralink Technology covers PCs, Internet TVs, Blu-ray players, game consoles, tablet PCs and smart phones, which will greatly enrich MediaTek's product line.
In order to make up for the shortcomings of smart phones, MediaTek also came up with an alternative plan to launch an intermediate software platform MRE and new chip products to enable ordinary 2G mobile phones to have "class smart phones". According to MediaTek, it is located between smart phones and feature phones, and uses a semi-open platform to enable user experiences like Internet access and similar smartphones.
MediaTek's concept of "class smart phones" was introduced to the world, and the industry's failure has never been interrupted. However, MediaTek is very optimistic about this new chip solution and believes that it will be able to distinguish itself from competitors such as Spreadtrum and Morningstar.
Xie Qingjiang is full of confidence in "class smart phones." He believes that although the current 3G smart phone shipments rose sharply, but from the market point of view, the demand for feature phones is far more than smart phones. MediaTek's latest product solutions will provide smart phone operating experience for feature phones such as Internet access, large-screen full touch, and software download.
Ideal is full, the reality is very skinny. Since last year, the three major operators in China have been pushing thousands of smartphones. Huawei, ZTE, Coolpad and others have launched a large number of thousand smartphones and have already pushed prices down. In the view of industry professionals, MediaTek's castrated solution is difficult to gain recognition from domestic first-tier manufacturers.
According to reports, MediaTek's "class smart phones" do not have 3G capabilities and do not support Android, and the chip's main frequency is too low to carry some large-scale applications. Although this kind of mobile phone is very cheap, but in fact does not have the difference with the ordinary functional mobile phone very much, it is difficult to arouse the consumer to purchase the desire.
In recent years, MediaTek has been seeking business transformation. It has already entered the TV chip market and has become a core supplier. In the eyes of the industry, this move is expected to ease the pressure on MediaTek to fall into the 2G market. However, in the short term, MediaTek’s revenue of about 70% will still come from the 2G chip business, and 3G chips will have to be mass-produced. It is estimated that it will wait until next year. Therefore, the external expectations of MediaTek's performance in the next few quarters are not optimistic.
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