Top 3 Reasons Smartphone Brands Don’t Make Their Own Chips

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In the smartphone industry, there are only a handful of smartphone brands that have their own chip. Well, by chip we are talking about the processor of the smartphone and not a video chip, image or load optimization chips. Only Apple, Huawei and Samsung are compatible with their chips. Other manufacturers like Xiaomi have smartphone chips, but they are hardly consistent. A few weeks ago, Oppo released its flagship smartphone Oppo Find X5 Pro and it comes with its new chip, MariSilicon X. However, it is an independent image chip. Even the Xiaomi Surge S1 which is a mobile phone chip has no successor after many years.

It is much easier to produce a single function chip like an image chip. These chips work with the processor to help optimize image performance. Currently, all brands want to have an image chip. Also, big brands will eventually want to have their own smartphone processor. Nevertheless, there is a reality that they must accept. The processor is not something that can be done just by thinking about it. Not only is this difficult to do, but it also burns money.

Now let’s look at some reasons why smartphone brands can’t just make processors.

1. Processors are complex

Today’s processors are not so much single-function processors, but rather a complete system-on-chip. Take the example of the Apple A15 processor. In addition to processor (CPU), there are graphics card (GPU), DSP, image processor (ISP), wireless baseband, AI processor (NPU), video codecs, system caches , etc The design of each part is not simple, take the base band as an example.

Apple has been shouting about closed-loop ecology for many years, and the M1 processor has been erased. However, it just can’t get a working 5G communication baseband. After biting the bullet and using Intel’s baseband for two years, it finally had to re-cooperate with Qualcomm. That’s why we now have Qualomm’s baseband in the iPhone.

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Design is only one aspect

And ah, the ability to design these functional modules is only one aspect. Manufacturers must also be able to combine these functional modules with each other. Combine functions… Sounds like building blocks, doesn’t it? It’s not that simple bro, there are a lot of “how to’s” that will require answers. Some of the tutorials are how…

  • connect these pieces together
  • make trade-offs between power consumption and performance
  • choose the appropriate data path
  • make hardware layout and software design compatible
  • Effectively control leakage under nanotechnology and reduce static power consumption
  • use new burning technology to optimize the process
  • manage competitive risk/noise interference under broadband signal

This building block is difficult, isn’t it?. Can any manufacturer fix these issues? Yes, but there’s not much we can do. Apple, Huawei and Samsung all have their answers, but not without cooperating with other companies.

Huawei has been working hard on chips since 2009. After nearly ten years of research and development, it has invested hundreds of billions of dollars to finally have the ability to compete. However, the US ban hits the company because it needs certain US technology to manufacture the chips.

2. The production of processors is very expensive

Of course, many smartphone brands that want to enter the chip market are not even at the processor design level. Indeed, when the team establishes the technical requirements, it all comes down to the start-up capital.

money

Let’s look at the easy part. If a brand wants to start producing chips, they can’t just lure a few people into a garage and call it a team. Make a chip, if the team is less than a hundred people, it looks like child’s play. This team’s salary alone is a lot of money…

In addition to human resources, our mobile phone processors also have to pay ARM. They must pay ARM the corresponding license fees for the purchase of ARM architecture and IP cores.

In addition to the “see end” costs above, there are “endless” costs that are even more concerning.

You should know that bugs will inevitably appear after writing a program. Today, programmers have to repeatedly refine code and fight bugs.

The same goes for chip design – a chip design cannot be formed all at once. As it is designed, it will undergo many intermediate functional tests.

Some functional tests can be performed by software that simulates how the chip operates. These tests are called “emulation”. For further functional testing, some chips need to be trial-produced in small batches and run on a real smartphone.

This process is called “tape out” and trial production is obviously not free. In the 14nm process, the cost of tape output is in the millions. Under the popular 5nm process in 2021, the price for a tape release is around $50 million.

How much does it cost to design a mobile phone processor?

So how many strips will you need to make a chip? It’s impossible to say and it’s one of the frightening “endless” costs. There may also be bugs that are not fully understood. Such a debug tape output goes back and forth several times.

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So in all of this, you might be wondering how much it will cost to manufacture a smartphone processor. Let’s take an example… Huawei HiSilicon Kirin has invested 480 billion yuan ($75.5 billion) over the past 10 years. Its investments in 2019 reached 131.7 billion yuan ($20.7 billion). It took a lot of effort to complete the Kirin series SoC which can match Apple’s Qualcomm.

3. Small progress requires huge R&D

There are several processes that follow the production of a smartphone processor. The irony of the process is that you might need different teams for different aspects of the chip. Plus, months and millions of dollars can go by before you see small progress. Smartphone brands that don’t have the patience don’t go into chip production. For example, the pop-up camera, under-screen camera, in-screen fingerprint sensors and other new features all work with the processor. Just to get an in-display fingerprint sensor working, you might need a whole team working on the chip for several months.

Conclusion

Considering the turmoil as well as the huge financial commitment, many smartphone brands are only focusing on their smartphones. They will prefer buying chips from “chip companies” such as Qualcomm or MediaTek rather than making their own in-house chips.

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