Intel Corp. has signed up another company for its Intel Foundry Services (IFS) in MediaTek, the Taiwanese smart device semiconductor company that competes with Qualcomm in the smartphone chipset market.
Intel said the agreement is designed to help MediaTek secure a more balanced, resilient supply chain for the U.S and European markets. MediaTek will use Intel to manufacture multiple chips for a range of smart devices including smartphones, tablets and more.
The partnership with MediaTek is the third confirmed partner for IFS. Last year, Intel announced it would build chips for Qualcomm and Amazon as it looks to expand U.S. domestic semiconductor manufacturing to compete against the likes of Taiwan Semiconductor Manufacturing Co. and Samsung Electronics.
“MediaTek has long adopted a multi-sourcing strategy,” said NS Tsai, corporate senior VP of platform technology and manufacturing operations at MediaTek. “We have an existing 5G data card business partnership with Intel, and now extend our relationship to manufacturing smart edge devices through Intel Foundry Services.”
Intel is rapidly expanding its IFS platform with new fabs being constructed at its Ocotillo campus in Chandler, Arizona as well as two new fabs being constructed in Licking County, Ohio, and new facilities in Germany.
Additionally, Intel Corp. in February said it would acquire pure-play foundry Tower Semiconductor for $5.4 billion to expand its global footprint and technology portfolio for IFS.
Because of this, IFS offers technologies optimized for high performance such as the smartphone market as well as those built for mature process technologies, such as the automotive sector.
Why it is important
MediaTek is really the only challenger to Qualcomm in the smartphone chipset market. Qualcomm’s Snapdragon portfolio has become nearly ubiquitous in the mobile market as well as other smart devices where the company has become almost the de facto supplier.
MediaTek has garnered some momentum in the market this year with new introductions to compete against Qualcomm such as its millimeter wave (mmWave) 5G chipset for future smartphones and two system-on-chips (SoCs) to give smartphone OEMs more differentiation.
The company is seen as an alternative to Qualcomm chipsets, which may be a way to differentiate smart devices in hotly contested regions or to lower the cost of handsets such as in a new generation of mmWave devices that will allow 5G to reach its full potential.
Currently, MediaTek is well positioned in China and has close ties to Chinese smartphone vendors, but it could be also penetrating the Japanese smartphone market as well.
The move to secure foundry capacity from Intel could be a sign that MediaTek is looking to branch out beyond these markets to compete in the U.S. and European smartphone and smart device space.
