Prices for 4G smartphone chip solutions, which have fallen about 40% so far in 2015, will continue their downward trend in the second half of the year. Prices will fall an overall 50% for 2015, according to industry sources.

The price decline of an estimated 50% in one year shows fierce competition among chipmakes in the 4G-phone segment, said the sources. It took more than two years for 3G handset chips, and 3-4 years for 2.5G phone chips, to have their first 50% falls, the sources indicated.

On the demand side, sales of mid-range and high-end Android phones have been a disappointment since 2015, the sources observed. Major Android-phone chip suppliers including Qualcomm and MediaTek have all initiated price cuts to attract orders, the sources said.

A stronger US dollar has also weakened smartphone demand in China and emerging markets, further hurting demand for 4G phone chips, the sources indicated. Handset-chip providers have been prompted to accelerate their price cuts since the second quarter of 2015, the sources said.(from digitimes)

In addition, foundry chipmakers have seen their production capacities stay loose thus far in 2015. While having sufficient wafer starts at their foundry partners, 4G-phone chip suppliers tend to lower their prices to stay competitive, the sources noted.