Qualcomm wins back Samsung, LG business

By Kim Yoo-chul

BARCELONA, Spain ― After a year of struggles, U.S.-based Qualcomm fully normalized its business tie-ups with Samsung Electronics and LG Electronics.

Qualcomm said at this year’s Mobile World Congress (MWC), here, that the company’s flagship Snapdragon 820 processor was being used for Samsung Electronics’ latest smartphones ― the Galaxy S7 (S7) and S7 with a curved design (S7 edge).

Given that Samsung has the largest smartphone market share, the tie-up will be beneficial, according to officials.

“With Samsung, this year will be better for Qualcomm than last year, when it was excluded from several batches of Samsung’s Galaxy S6 smartphones,” an official said Thursday (KST). “The partnership with Samsung will be constructive in the future and be expanded into new projects.”

The 820 chip adopted Samsung Electronics’ 14-nanometer processing technology and will be used in the two latest Samsung smartphones for the U.S. and Europe.

Samsung said it would use the company-owned Exynos-branded mobile application processors in the smartphones for Korea.

Due to overheating problems, which Qualcomm CEO Steve Mollenkopf later admitted, the U.S. company was in deep trouble last year. It ordered its engineers to address the issue and to immediately customize chips for different handset models.

Because, unlike Samsung, LG Electronics does not have its own factories to produce mobile application chips, the “Qualcomm trouble” forced the company to change plans for the release of its flagship models.

But the Qualcomm CEO appeared at LG’s mobile event for the G5 to praise LG’s successful development of its first modular smartphone.

During the LG event, more than 14 seats were reserved exclusively for Qualcomm officials.

“Qualcomm has high hopes for good sales of the G5,” an LG official said. “Qualcomm apologized again to LG for the instability of the early version of the 820 chips. However Qualcomm promised to expand the partnership into the automotive business, which is promising.”

LG Electronics earlier said it was planning heavy promotional campaigns to increase its global share.

Qualcomm said the smartphone industry would grow and that its own growth would be in accordance with industry growth. It stressed that its decision to invest in joint ventures and TDK was also aimed at strengthening its presence in the smarpthone industry.

According to GSMA Intelligence, smartphones will account for half of all mobile connections this year as the main focus switches to the developing world.

“Affordability is a major factor influencing smartphone adoption, especially in the developing world,” said GSMA Intelligence forecasting unit analyst Gu Zhang.

“Smartphone prices are expected to fall due to increasing competition, a drop in the cost of materials and improvements in software.

China will remain the biggest smartphone market this year, in which Samsung is one of the top-tier players.

But Qualcomm hopes Samsung will introduce more budget variants of its Galaxy-branded models for India, which is set to replace the U.S. as the world’s No. 2 smartphone market from the second quarter of this year.