35%
Questionable
As Chinese smartphone brands cut smartphone shipments in the wake of the DRAM shortage, Samsung reportedly targets an opportunity to raise its tally in a market that it has struggled to penetrate for years. To achieve this, a new report states that the Korean giant will resort to using CXMT’s DRAM chips, which are said to be cheaper, but that’s where the misconception should end.
CXMT’s DRAM chips are anything but cheap; Samsung still has a chance to enter China’s smartphone market
A report from Asia Times claims that Samsung is considering the use of “low-cost” Chinese DRAM as the company aims to target the mid-range to low-end smartphone market. As local competitors see no reason to raise shipments due to rising memory costs, it’s one heck of a chance for Samsung to obtain a foothold in the world’s largest handset market by volume.
According to IDC, the Korean technology behemoth’s smartphone share in China is a laughable 0.1 percent, while its biggest rival in this space, Apple, has slowly but surely clawed its way to the top, securing second position with an 18.1 percent share, trailing behind Huawei. Typically, Chinese suppliers offer an inexpensive haven to potential customers, but on the subject of DRAM, this isn’t the case.
Even though the report doesn’t explicitly mention CXMT being Samsung’s potential partner, offering low-cost DRAM chips isn’t going to happen. For starters, Apple too has been eyeing a partnership with the memory manufacturer, but its goal isn’t to secure cheaper parts, but to minimize supply risk as the majority of shipments have been gobbled up by AI customers.
Also, if we perform a price comparison, CXMT is charging more than Samsung for DDR5 memory, and the low DRAM volume that the company will require to ship its devices in China means it’ll probably be paying a substantial premium for a smaller quantity. Huawei, which is at the top of the smartphone market in this region, wasn’t able to obtain any relief, not even from a local supply chain partner.
In fact, a previously reported incident revealed that CXMT and Huawei are engaged in a power struggle, with the Chinese memory maker’s newfound position giving it the liberty to charge prices that the smartphone manufacturer cannot fathom. Looking at Huawei’s subpar treatment, what unique proposition does Samsung have to offer to obtain this advantage, especially considering its measly market share?
Money? Yes, the Korean giant is probably sitting on billions in liquid cash, but it’s nowhere near the sum that AI customers throw at CXMT’s direction. After all, just partnering with Tencent has secured a $3 billion deal for CXMT, pretty much concluding that no amount of money offered by Samsung will enforce a discount on memory chips. At the end of the day, the report originated from a Korean outlet, so we shouldn’t be surprised to witness this sort of propaganda that blatantly paints Samsung’s position in a green light.
News Source: Asiatime
About the author: Omar Sohail is a reporter and analyst for Wccftech's mobile section, specializing in the technology and business of the mobile industry. His expertise lies in the intricate hardware supply chain, covering developments in semiconductor manufacturing, chip lithography, and camera sensor technology.
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