Xiaomi may soon follow Huawei, Samsung and Apple by developing and selling its own smartphone processors, The Wall Street Journal said this week. It’s a move that has paid off for those companies, which aren’t tied down to manufacturing schedules or supply created by chip-makers.
The Wall Street Journal said Xiaomi’s processor is dubbed “Pinecone” and may launch as soon as next month under a Xiaomi subsidiary named “Beijing Pinecone Electronics.” It’s unclear if Xiaomi intends to create a powerful processor capable of competing with the best Exynos, Kirin and AX chips developed by Samsung, Huawei and Apple, respectively, or if it’s trying to develop a low-power mass-market chip. My guess is it might try to do both at some point.
Why it makes sense
Xiaomi uses Qualcomm chips in some of its phones, but it may want to shift away from Qualcomm for several reasons. The primary one is that Samsung has reportedly gobbled up all of Qualcomm’s Snapdragon 835 orders, leaving other firms scrambling or deploying older Snapdragon 821 chips. LG and HTC have had to do that, for example, with the LG G6 expected to pack the Snapdragon 821 and the HTC U Ultra already confirmed to do so. If Xiaomi sees this become a regular trend, it can avoid the issue by developing its own chips.
It may save Xiaomi money, too. The company is known for selling low-cost handsets, and developing its own processors could allow it to increase the profit margins on every phone sold. MWC kicks off later this month, so maybe we’ll hear a bit more about Pinecone during the show.