Amid mounting pressure from the US government, Huawei's HiSilicon will not be capable of manufacturing flagship chipsets from September 2020. Will Xiaomi's commitment in chipset R&D bear fruit?
As China’s second-largest phone vendor following Huawei, Xiaomi's (01810:HK) chipset development is drawing public attention – especially as the US sanctions are taking tolls on Huawei. On August 9, Lei Jun, Xiaomi’s CEO, reported to media that the company will continue the R&D on its Pengpai chipset, even though there are likely to be huge difficulties ahead.
Xiaomi has shown its aspiration to make self-developed chipsets since 2014 when the company and a fabless semiconductor company Leadcore jointly founded the Songguo Electronics, which is specialized in smartphone SoC research and development. In 2017, the firm launched Mi 5C that carried its own chip ‘Pengpai S1’. That was the first and the last to date accomplishment of Xiaomi’s chipset development.
Inspired by Huawei’s success in self-sufficient chipset design and supply, along with the international pressure that posed on Huawei, Xiaomi has been making active moves in investing in the chip development business. During the first half of 2020, Xiaomi’s industrial fund invested in 8 semiconductor firms, covering chip products of Wi-Fi chips, RF, MCU and FPGA. Besides, the newly appointed smartphone division head, Xuezhong Zeng, who previously served as the vice president of the Integrated Circuit Industry Technology Innovation Alliance (ICTIA), will provide a strong push for the company's chipset division.