ARM vs. Qualcomm: AI Chip Battle Heats Up
The rivalry between chip design giant ARM and mobile chip titan Qualcomm is escalating.
On October 23rd, according to relevant media reports, ARM plans to revoke Qualcomm's authorization to use its intellectual property to design chips. According to the latest document, ARM has given Qualcomm a 60-day advance notice with the intention of terminating the architectural licensing agreement between the two parties.
At the recent Qualcomm Snapdragon Summit, Qualcomm announced a significant piece of news. "Qualcomm is changing and transforming into a company focused on AI processors that dominate interconnected computing. AI is the biggest disruptive change facing mobile computing today, and 'AI first' is the core focus on this generation of Snapdragon flagship chips," said Cristiano Amon, President and CEO of Qualcomm, in his opening speech at the three-day Snapdragon Summit that kicked off in Hawaii on October 21st. As the highlight of the event, Qualcomm unveiled its new generation of mobile system chips, the Snapdragon 8 Elite (Snapdragon 8 Elite), which "will usher in a new era of on-device generative AI."
According to official information, the Snapdragon 8 Elite features technologies including the second-generation custom Qualcomm Oryon CPU, Qualcomm Adreno GPU, and enhanced Qualcomm Hexagon NPU, enabling the implementation of on-device multimodal generative AI applications on smartphones powered by the Snapdragon platform.
In the view of Counterpoint's Senior Analyst William Li, Qualcomm's formal incorporation of the Oryon architecture into mobile phones has indeed taught a lesson to the ARM camp and the entire mobile phone market, demonstrating that Qualcomm is capable of designing top-tier chips from the ground up. The first generation led the way in laptops, and now the second generation of Oryon, featured in the Snapdragon 8 Elite mobile chip, will exert tremendous pressure on competitors.
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Intense Battle for Mobile AI Chips
"How can your new phone be without a Snapdragon?" This eye-catching slogan immediately catches the attention when visiting the official website of Qualcomm, the leader in mobile chips.
Local time on October 21st (3:00 AM Beijing time on October 22nd), Qualcomm officially released the new generation of flagship mobile phone processors, the Snapdragon 8 Elite, at the Snapdragon Summit. The company claims that this is the first time Qualcomm has applied the Oryon CPU architecture to a smartphone processor, whereas the previously equipped Snapdragon X Elite processor was mainly used in laptops.
Data released by Qualcomm shows that the Snapdragon 8 Elite adopts a "2+6" architectural design, featuring 2 super cores at 4.32GHz and 6 performance cores at 3.53GHz, eliminating the efficiency cores. The frequencies are approximately 31% and 10% higher than the previous generation's flagship chip, the Snapdragon 8 Gen 3. In addition to changes in the core architecture, in terms of process technology, like the recently released flagship 5G AI chip Dimensity 9400 by MediaTek, the Snapdragon 8 Elite also uses TSMC's latest second-generation 3-nanometer process, which is the same process used in Apple's A18 Pro processor.
"Oryon completes the last piece of the puzzle for our entire SoC (System on Chip)," said Christopher Patrick, Senior Vice President and General Manager of Mobile Business at Qualcomm, who referred to the self-developed architecture-based mobile chip as an "industry turning point" at the summit.Compared to cloud-based AI that relies on data centers and runs on cloud servers, edge AI stands out with its low comprehensive cost, high local reliability, strong privacy protection, and prominent personalized services. Currently, deploying meticulously trained large models into terminal devices has become the core focus of a new round of technological competition between the terminal and chip industries. Against this backdrop, the edge AI capabilities of the Snapdragon 8 Elite's A-series have been particularly highlighted. Officially, with the Hexagon NPU (Neural Processing Unit) equipped with a large model edge-side execution engine, the Snapdragon 8 Elite boasts an 80TOPS computing power, with a 45% increase in both AI performance and power efficiency per unit of power consumption, and supports multi-mode AI on the edge and longer Token input.
"Smartphone brands such as Xiaomi, Honor, and OnePlus will release terminals equipped with the Snapdragon 8 Elite in the coming weeks." On the evening of October 22, Qualcomm's Global Vice President, Mingjuan Hou, said at a media communication meeting that Xiaomi Group has won the first right to launch the Snapdragon 8 Elite. At the Snapdragon Summit, Honor's Chief Marketing Officer, Rui Guo, also made his first public presentation of the upcoming Honor Magic 7 smartphone.
Currently, the Android smartphone chip market has always been dominated by Qualcomm and MediaTek. Data from global market research institution Counterpoint shows that MediaTek's smartphone chip shipments exceeded Qualcomm's in the third quarter of 2020, and then gradually expanded its market share. In the second quarter of 2024, MediaTek still ranked first with a 32% share, Qualcomm was 31%, and Apple ranked third with a 13% market share.
Half a month ago, before the release of Qualcomm's new chip, MediaTek took the lead in launching the latest Dimensity 9400, which also emphasized edge AI capabilities. MediaTek introduced that the Dimensity 9400 integrates a new generation of self-developed AI processors, for the first time supporting edge-side model customization (LoRA) and edge-side high-quality video generation. Compared with the previous generation chip product Dimensity 9300, the Dimensity 9400's large language model's prompt processing performance has increased by 80%, and power consumption has been saved by 35%.
At that time, some market analysts pointed out that MediaTek's choice to release new products at this moment was obviously challenging Qualcomm. At its press conference, MediaTek's statement "deep foundation, no need to pursue high frequency" also seemed to be a dialogue with Qualcomm, because there were rumors in the market that the main frequency of the new product that Qualcomm was about to release might break through 4.0GHz.
In the past, MediaTek occupied a significant share in the mid-to-low-end market, and in recent years, with continuous efforts in the high-end market, the competition between MediaTek and Qualcomm has become increasingly fierce. Nevertheless, in the high-end chip market of the smartphone field, Qualcomm still holds the leading position. From public information, MediaTek's Dimensity 9400 chip is applied to high-end flagship models such as OPPO's Find X8 and vivo's X200 series, but for the more high-end Ultra series models of these brands, they still prefer to choose Qualcomm Snapdragon 8 series chips as the core power, such as the upcoming OPPO Find X8 Ultra, which will be equipped with the Snapdragon 8 Elite.
New Battle of Chip Giants
"At previous Snapdragon Summits, we mainly discussed mobile intelligent terminals and PCs, that is, those small devices that can be carried with you. But this year we will focus on a larger terminal - cars." Mingjuan Hou said at the above communication meeting.
As the pillar business of Qualcomm, mobile phone chips have always accounted for more than 60% of its revenue. In the third quarter of the fiscal year 2024 (i.e., 24Q2), Qualcomm's mobile phone chip business achieved a year-on-year increase of 12.3%, reaching $5.9 billion. At the same time, the revenue of automotive chip business was $811 million, with a year-on-year increase of 86.9%. Previously, Qualcomm stated that the automotive business has become the fastest-growing item among the company's main businesses, and this growth is mainly due to the increasing demand for new cars equipped with its Snapdragon digital cockpit products.During this year's Snapdragon Summit, Qualcomm officially announced the launch of two premium automotive platform chips - the Snapdragon Cockpit Elite and the Snapdragon Ride Elite. According to the company's plan, the two new products will be sampled in 2025, targeting the cockpit and driving scenarios, respectively. The officially announced partners include Mercedes-Benz and Li Auto.
Prior to this, since the launch of the first-generation Snapdragon 620A in 2014, Qualcomm has released four generations of smart cockpit chips, with the chip process technology upgrading from 28nm to 5nm. Looking at the timeline, as early as 2002, Qualcomm provided CDMA automotive networking solutions for General Motors' OnStar, but at that time, "getting on board" was not a focus for Qualcomm. Guotai Junan previously pointed out in a deep report on the automotive smart cockpit industry that before 2015, the chips for computing and control in automotive infotainment systems were mainly based on MCUs and low-computing-power SoCs, with suppliers including Renesas, NXP, TI, etc. After 2015, benefiting from the continuous increase in cockpit computing power demand, original consumer chip manufacturers such as Qualcomm, NVIDIA, Samsung, Intel, etc., began to enter the smart cockpit supply chain, and the supply pattern has undergone significant changes.
For the two automotive platform chips introduced this time, similar to the aforementioned mobile phone chips, AI features remain Qualcomm's biggest selling point. Nakul Duggal, General Manager of Qualcomm's Automotive, Industry Solutions, and Cloud Business Group, said in his speech that compared to the previous generation, these two products use a unified architecture: the Qualcomm Oryon CPU specifically customized for automobiles, which is 3 times faster than the previous generation; they are also equipped with the Adreno GPU designed for automotive applications, with performance increased by 3 times; and they have a dedicated neural network processor (NPU) designed for multimodal AI, with performance increased by 12 times compared to the previous generation.
In the tide of automotive intelligence, smart cockpit chips have become a field with great development potential. In terms of market size, ICV data shows that the global smart driving SoC market size in 2022 was $3.295 billion, with the Chinese market size reaching $1.505 billion, accounting for 45.68% of the global total. It is estimated that the global smart driving SoC market size is expected to break through $10 billion in 2024, and is expected to reach $28.306 billion by 2027, with a compound annual growth rate as high as 43.11%.
Achieving breakthroughs in the smart cockpit market through differentiated AI capabilities has become a consensus in the industry. Not only Qualcomm, but in August this year, Intel also released its first independent automotive graphics card, and the official said that the product will achieve mass production in 2025, providing computing power far beyond the existing chip solutions on the market to support the deployment of stronger end-side AI capabilities in the automotive cockpit.
In early October, along with the release of the Tianmao 9400, MediaTek also released the 3nm flagship automotive cockpit chip CT-X1. MediaTek said that like the Tianmao 9400, CT-X1 uses a full large-core architecture, with a hardware-level GPU (3000 GFLOPS) and an end-side generative AI NPU (46+TOPS), supporting up to 13 billion multimodal generative AI models on the end side. The first batch of models equipped with CT-X1 will be mass-produced and launched in 2025.
The automotive cockpit chip market has become an important track for chip companies to compete for, new changes are brewing, and the giants are scrambling, no one is willing to lose.