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MediaTek intends to take on Qualcomm with new 5G chip

FILE PHOTO: MediaTek chips are seen on a development board at the MediaTek booth during the 2015 Computex fair in Taipei, Taiwan, June 3, 2015. REUTERS/Pichi Chuang/File Photo

(Reuters) – Taiwan-based chip supplier MediaTek Inc on Wednesday, has a new 5G chip for fast, high-end smartphones that aims to be a much bigger competitor, Qualcomm Inc.

MediaTek is best know for making potato chips in the smart speaker devices, such as Amazon.com Inc. ‘s, Echo’s and for the make of the chips in the more basic Android phones. Qualcomm’s older chips also find their way into some of those low-priced phones, but the San Diego company is better known for the supply of high-powered chips for more expensive Android phones, like the Google Pixel.

With a new chip unveiled at the Computex trade show in Taiwan, MediaTek is aimed at the more powerful phones currently supplied by Qualcomm. The chip will contain MediaTek’s 5G modem, used to connect phones to the next generation of wireless data networks to roll out this year and next year.

MediaTek’s new chip combines the modem with the latest processor-core technology of Softbank Group Corp-owned Arm Holdings. By building in powerful processors, as well as computing cores for things like artificial intelligence, MediaTek is looking to challenge Qualcomm’s dominance.

However, Qualcomm has a head start. In February, it announced the second-generation 5G chip for smartphones.

Huawei Technologies Co., Ltd. Samsung Electronics Co Ltd, are also the development of 5G chips, provide their own phones. Intel Corp, that was the supply of modems for Apple Inc iPhone, said that it would leave the 5G modem business after Apple inked a chip supply deal with Qualcomm in April.

Qualcomm chip also provides two variants of 5G networks, the so-called sub-6 and millimeter wave bands. That means that phones using the chip will work on any carrier that 5G networks.

MediaTek’s chip, by contrast, currently only processes the sub-6 variants of 5G networks. That helps to reduce the cost, MediaTek officials said. But it also means that it will not work on all 5G networks of providers, such as Verizon Communications Inc and AT&T Inc, which make use of the millimeter wave technology.

Russ Mestechkin, MediaTek’s senior director of sales and business development of the united states and Latin America, told Reuters that the company is confident that the chip be able to compete in the market for mobile phones designed to work on networks that use only sub-6-technology, such as that of Sprint Corp and T-Mobile US Inc in the United States, and many Chinese networks.

Reporting by Stephen Nellis in San Francisco, Editing by Rosalba O’brien

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