Nine months after its acquisition of Icera, NVIDIA officially kicked off its cellular platform strategy by announcing the ZTE Mimosa X, which is the first phone to feature Icera’s ICE8065 HSPA+ baseband. Previously, we have analysed NVIDIA's Icera acquisition in a separate blog post.

NVIDIA is targeting the mainstream smartphone segment with its new cellular platform strategy. We believe that NVIDIA is pursuing a 'risky' strategy (multi-core only) and may have to sacrifice its margins to address the mainstream segment. NVIDIA's competitors Qualcomm, Broadcom, ST-Ericsson, MediaTek and Spreadtrum have single core baseband-integrated apps processors that can address the mainstream smartphone segment with better margins.

It's no secret that every major mobile chipset company is now pursuing a 'complete platform strategy' to capture more value per design-win and NVIDIA still lacks technology pieces such as connectivity ICs (WLAN, Bluetooth, NFC, GPS and FM radio). NVIDIA may have to go for further acquisitions to fill this connectivity chip portfolio gap. Market leaders Qualcomm and MediaTek also pursued acquisitions to fill their connectivity chip portfolio gap.

NVIDIA is currently focusing on the performance smartphone segment but this segment is already cornered by Apple, Samsung and Qualcomm. NVIDIA ranked number six in the smartphone CPU market in 2011, by our estimates. The company should consider releasing a single-core version of its Tegra 2 processor to compete effectively and to increase its addressable market, in our view. NVIDIA is expected to have baseband-integrated Tegra processors ready by end of this year which could potentially allow the company to participate aggressively in the sub-$150 smartphone segment. But NVIDIA should also consider low-cost ARM architectures such as Cortex-A5 to improve its volume market share.

Sravan Kundojjala

Client reading : Smartphone Apps Processor Market Share 2011: Qualcomm Takes the Lead in Units and Revenue ; NVIDIA-Icera Combination Creates a Credible Challenger to Qualcomm

Last week, we released our smartphone apps processor market share data. Based on our estimates, the smartphone apps processor market showed a strong 70 percent year-on-year growth to reach $7.9 billion in 2011.
 
Some key highlights from our 2011 global smartphone apps processor market share tracker:

• Qualcomm, Samsung, Texas Instruments, Marvell, Broadcom and NVIDIA grabbed the top-six smartphone apps processor revenue share rankings in 2011.

• For the first time, on an annual basis, Qualcomm topped the smartphone apps  processor market in unit terms in 2011, snatching the long-held crown from Texas Instruments. Qualcomm continued its revenue share lead in 2011 and captured approximately 50 percent revenue share. Qualcomm’s broad Snapdragon processor portfolio and excellent relationships with almost all top-tier smartphone vendors helped Qualcomm to gain market share during 2011.

• Broadcom stormed into the top-five rankings in 2011 for the first time, thanks to its high-volume Android design-wins. Broadcom’s apps processor shipments showed over 500 percent year-on-year growth in 2011. We believe that Broadcom can improve its market share further if it continues to execute well.

• New entrant NVIDIA performed well in its first year in smartphones and finished as the number six player in both unit terms and revenue terms in 2011. Despite its first mover advantage with dual-core processors, NVIDIA lost momentum in the second half of 2011.

• MediaTek showed significant improvement in 2011, thanks to its new HSPA smartphone processor MT6573. However, we believe that MediaTek has some catchup to do to compete effectively in the high-end market.

• ST-Ericsson struggled in 2011 and finished the year with less than 1 percent revenue share. The company couldn't capitalize on its renewed product portfolio in 2011. ST-Ericsson's outlook is challenged and the company needs to execute flawlessly this year to get back into the game. We believe that ST-Ericsson's Nova and NovaThor processors have the potential to be an attractive alternative to Qualcomm's Snapdragon processors and it all depends on ST-Ericsson's execution this year.

• Stand-alone applications processors accounted for 40 percent of total smartphone applications processor revenues in 2011 and out-grew baseband-integrated applications processors, thanks to Apple, Samsung, Texas Instruments, NVIDIA and Qualcomm.

Looking ahead, we believe that key market trends such as multi price-tier smartphones, emerging markets and new generation CPU and GPU technologies will create opportunities for smartphone apps processor vendors.

Sravan Kundojjala

Client reading: Smartphone Apps Processor Market Share 2011: Qualcomm Takes the Lead in Units and Revenue

From a component technology perspective, there are a few things that I am looking forward to seeing at MWC 2012, including:

1. NVIDIA’s Tegra 3 processor appearing in HTC smartphones – do we really need quad core processors in handsets though? What does it add? Is power consumption improved? I'm sure the experience will be impressive and we'll know more once we've seen Tegra 3 in action on a smartphone.
2. Intel’s Medfield processor should be appearing in Motorola and Lenovo smartphones at least. The performance stats appear impressive, but I’ll be looking to see how the power consumption compares to ARM-based processors.
3. Qualcomm's mirasol and Pixtronix display technologies. Mirasol is only available as a 5.7-inch display at present. When will the technology be good enough for phones, if ever? And how does Pixtronix fit into Qualcomm's portfolio alongside mirasol. Does Qualcomm really need two MEMS-based display technologies?
4. Powermat and other WPC wireless charging products. I’ll be looking to see the growth opportunities for Qi-compliant products and asking whether they can gain traction without Apple's commitment to the Qi standard?
5. Scalado has a new camera software, called Remove, that deletes people in the background of your photos. Looks quite interesting.
6. Senseg touchscreen technology. My most anticipated viewing. Their technology allows you to create customizable and changeable buttons, edges and textures on the screen, taking haptics to the next level. It won't be commerically available for another 2 years yet, but I'm looking forward to seeing the demos. 

This is just a taster. I'm sure there will be plenty more to talk about at the show next week.

If you have any thoughts, let me know.

Stuart Robinson