Qualcomm, Qualcomm, mediatek's gross margin low frequency innovation, combined with the Apple (Apple) iPhone sales performance on the rocks, and began to face city share, gross margin decline in the test, the recent major foundries TSMC pay close attention to the global market competition, intelligent mobile phone chips have even considered for 16/20 of nano and other advanced process to adjust the price, customer profit pressures to soothe mobile phone chips.

As qualcomm mobile phone chips dropped below 50% gross margin, mediatek's gross margin fell below 40%, spreadtrum gross margin is difficult to hold 30%, plus the apple iPhone market share began to appear not to advance is to go back pressure, profit margins could shrink further, making the average gross profit margin still maintain more than 50% of TSMC, will not escape again.

IC design industry, points out that the downstream major mobile phone brand plays a fierce battle for the city share, burning up all the way to the chip suppliers, even may escalate to burn, TSMC on this moment to support customer choice, to set the first control line.

Due to the global intelligent mobile phone market gradually into the new application, new features and new design is difficult to have a big breakthrough, cellphone products the same, even is highly similar to that of malignant bargain to keep the cell phone market competition, especially mainland China mobile phone brand owners take high standard, low price strategy, more let the knockout stages of the mobile phone market.

Recent Android camp gross margins overlapping innovation is low, only a few companies such as Samsung Electronics, Samsung Electronics, LG Electronics (such as LG Electronics) can sustain profits, and LG every smart phone earn an average of only a few dollars, highlights the global handset market situation.

Mobile phone brand customers into the plight of continual losses, has obvious impact up mobile phone chip suppliers, including qualcomm, mediatek and spreadtrum to hold the city landscape, forced to expand the itu competition, recent mediatek profit margins continue to decline, and profit margins will decline again in the future, mobile phone chip suppliers are facing profit decline in nightmare.

For TSMC, as mobile phone chip solutions from 20 nm process from generation to generation, 14/16 in 2016 has turned into the nano, even late 2016 and early 2017 will enter 10 nm process from generation to generation, TSMC has always emphasized strategy partnership with customers, at this time choose feedback some cost to the customer, cutting prices wafer foundry, is to support the customer key decisions.