Qualcomm faces a price dilemma with its top-of-the-line Snapdragon 8 Gen 3 Chipset. With a boost in specs, the company’s flagship SoC is now demanding 25% additional cost compared to its predecessor, Snapdragon 8 Gen 2. Qualcomm partners now face a challenging decision, as to absorb the elevated cost or pass it on to customers. It could potentially hinder the path for those planning to upgrade their smartphones in 2024.
Qualcomm’s Impact on the Pricing of Samsung Galaxy S24 series
The trend is not something new, and the companies have observed it over many generations of Qualcomm chipsets. With a gradual surge in pricing, the Snapdragon 8 Gen 3 has become the first-ever chipset to reach the $200 mark. Sourced through a recent X leak, the numbers estimate a 25% increase in the SoC’s pricing over the last generation, from 1160 to 1400 Yuan.
As evident by Samsung’s latest Galaxy S24 series, the 8 Gen 3 smartphones are getting steeper in pricing. In several markets, Samsung has opted to deliver the S24 series with an Exynos 2400 chip instead to lighten the blow. This strategy has allowed the company to maintain profit margins while saving consumers from the brunt of additional costs. Apart from last year, the company has opted for this strategy in the past, and will surely continue this trend moving forward.
However, the fact remains. In the U.S., the Galaxy S24 Ultra retails for $1,299.99, about a $100 increase from the previous year, likely influenced by the rising costs of Qualcomm Snapdragon 8 Gen 3. Even in the future, the SoC’s price trajectory may not see a relief. According to a Qualcomm executive, the transition to custom cores in the Gen 4 could make it even more expensive than the current Gen 3.
MediaTek Dimensity 9400 Rising to the Occasion as a better alternative
This news raises concerns about the affordability of future flagship smartphones. The trend will limit consumer choices and drive manufacturers to explore alternative chipsets to cut hardware costs. The competing silicon manufacturer, MediaTek, might be the next best choice for smartphone makers involved in the flagship industry. After the launch of MTK Dimensity 9300 last year, the company is now preparing to launch a successor shortly.
While Qualcomm faces escalating prices, MediaTek Dimensity 9400 looms on the horizon. Slated to enter mass production later this year, MediaTek will capitalize on Qualcomm’s market. It will offer a competitive second choice at a lower price. This move will allow manufacturers to curb the impact of rising chipset costs on device pricing. Since chipsets are getting more expensive by the day, companies like Samsung, Xiaomi, and OnePlus find themselves in a delicate pricing limbo.
2024-02-01 15:06:59