China's domestic smartphone market is expected to flourish in 2012. Taiwan-based mobile chip maker MediaTek is expected to meet strong competition from firms such as Qualcomm, Broadcom and Intel. The market believes MediaTek's 2012 revenues will show an on-year decrease.

In addition, firms such as Qualcomm, Broadcom and Intel have been eager to increase their smartphone chip market share in China. Meanwhile, MStar and Spreadtrum have been making progress in obtaining orders. Therefore, MediaTek may experience slow shipment growth in 2012.

Industry sources noted that mobile phone makers in China have been using quotes from competing firms to negotiate chip prices with MediaTek.

In addition, MediaTek's 2011 mobile phone chip shipments were 550 million units, but 80% of the shipments were for feature phones. If low- and medium-priced smartphones dominate China's domestic market, MediaTek's market share is likely to decrease. Furthermore, there has been many tough competitors fighting over the smartphone and 3G chip segments.

MediaTek announced in the beginning of 2012 that its smartphone and 3G chip shipments target is 50 million units. 

Source:digitimes