Chinese upstarts Rockchip and Allwinner put pressure on Qualcomm and Intel in tablet chip market

Qualcomm (NASDAQ:QCOM) is a leader in the tablet chipset market and Intel has spent mightily trying to crack into that market, but both have new competitors racing behind them from China. Rockchip Electronics and Allwinner Technology increased their tablet chip sales from a combined 0.3 percent of the market in 2010 to more than 27 percent just three years later, according to Bloomberg. By relying on designs from ARM Holdings they have jumped into the market more quickly than more established competitors did. ARM, which licenses its chipset designs and technology to nearly every major mobile silicon company, is looking to expand its business in China as more consumers there buy smartphones and tablets -- and as more devices are made there.

Rockchip and Allwinner have focused on being fast movers that throw caution to the wind. For example, instead of designing, making and testing a chipset, and then repeating that process, they use basic ARM building blocks to jump quickly through the "make and test" phase and skip the re-testing. Intel struck a deal with Rockchip in 2014 to jointly develop chips that the Chinese company can market to its local customers, especially for the value and entry-level tablet market segment.

Meanwhile, Allwinner does not just get chips to customers quickly, Ben El Baz, a company business development manager, told Bloomberg. "Until that first customer gets the first tablet off the production line, our engineering teams basically live in the factories of the customers," he said. "They do whatever it takes. You don't get that in the U.S.'' Article