Qualcomm hit hard by the Exynos chipset in Galaxy S6, might spin off the Snapdragon division

Qualcomm hit hard by the Exynos chipset in Galaxy S6, might spin off the Snapdragon division
The Galaxy S6 and S6 edge are the most expensive to produce flagships Samsung Electronics has ever attempted, with Verizon's S6 edge bill of materials reportedly hitting the whopping $290 apiece. About 110 components are used in the Galaxy S6, compared to roughly 80 in its predecessor - the Galaxy S5, not to mention the premium metal-and-glass chassis that is certainly more expensive to manufacture than the plasticky body of the S5.

Thankfully, Samsung can produce a lot of these components itself, and one way to reduce the overall bill of materials for the S6 and S6 edge was to use its own Exynos system chip, saving both on the final silicon price, and on patent royalties that Qualcomm collects on those phones using its processors. That shouldn't be much, you say? Well, how about 2.5-5% of the final retail price on each handset sold with a Snapdragon in it. This is actually the lion's share of Qualcomm's revenue and cash pile, rather than the processors themselves. Samsung alone has allegedly paid more than $9 billion to Qualcomm in royalties alone since the inception of the Galaxy S line.

The launch of the Galaxy S6 with Samsung's own application processor has reportedly given Qualcomm food for thought about cutting the patent royalties it demands from phone makers, and Samsung in particular, as it doesn't want to nix the relationship it has with the world's largest cell phone maker. 

Moreover, industry insiders tip that Qualcomm might separate its chipset-making unit altogether, as it can't really battle a silicon juggernaut like Samsung with its superior manufacturing processes, or the up-and-coming Chinese firms like MediaTek. The focus will then be shifted on the licensing and royalties business, so we are curious to see what will happen with the Snapdragon franchise in the future. After all, Qualcomm sports one of the biggest company cash piles - close to $30 billion - and most of it is amassed from patent royalties and licensing fees.

Related phones

Galaxy S6
  • Display 5.1" 1440 x 2560 pixels
  • Camera 16 MP / 5 MP front
  • Processor Samsung Exynos 7 Octa, Octa-core, 2100 MHz
  • Storage 128 GB
  • Battery 2550 mAh(23h 3G talk time)
Galaxy S6 edge
  • Display 5.1" 1440 x 2560 pixels
  • Camera 16 MP / 5 MP front
  • Processor Samsung Exynos 7 Octa, Octa-core, 2100 MHz
  • Storage 128 GB
  • Battery 2600 mAh(26h talk time)

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53 Comments

1. thunderc8

Posts: 98; Member since: Dec 15, 2014

Boom! Head shot by samsung, game over for qualcom.(for now)

16. wargreymon

Posts: 764; Member since: Nov 05, 2013

Only a moron would be happy to see another company stop making products.

26. thunderc8

Posts: 98; Member since: Dec 15, 2014

I can understand that it hurts, so better not sit in a chair for a while. As for the happy part i wouldnt say im too happy but i am excited that samsung made it and beat the former king, as i will be excited when qualcom does the same. All this competition is for our intrest, plus qualcom needed a serius spanking for selling revisions of the same cpu for 3 years with minor upgrades to cpu perfomance. Thats what happens when you think because you are the king you can sit and enjoy the profits fooling costumers with minor changes, Lancelot will come and bang your wife(first place) :)

30. thunderc8

Posts: 98; Member since: Dec 15, 2014

And only a moron would asume that i say qualcom will stop making products thats why i wrote (for now) at the end. But i gues rush and ignorance goes along with fanboism, that is the only explanation for speaking before thinking.

37. wargreymon

Posts: 764; Member since: Nov 05, 2013

This article is about Qualcomm losing a big chunk of income and might having to chunk their Snapdragon SoCs. Maybe you should have read the article first, but why bother? I guess you and the others just want to hail Samsung. I agree that there haven't been much improvement in their latest Krait, but even so, no other cores have overthrown it without going to Cortex-A50-series, which needed 20nm. As we all know 20nm didn't come until lately. So go ahead and applaud Samsung for having better manufacturing plants. But do that in the correct article and not one where it's about something else.

43. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

First off, this is business. If you don't want to get beat in the business you're in, then you make a product that is better than another option. Samsung dropped the SD because the 810 has a heating issue. Samsung lieks to run CPU's at very high clock speeds. IN fact they go pretty close to native capabilities. The SD was proven to cause a massaive amount of heat in a phone test. Question - Would you rather Samsung be like APple and knowing sell a product that has problems? Or would you rather they don't? You sound like you didn't think out the whole thing, you're just attacking a fan. With people already ripping Samsung saying the S5 was meager over th S4, and with Samsung getting hit hard by Apple and other OEM's, selling the S6 and S6 Edge which stand to be the best phone of 2015 with a chip that has issues, had problems written all over it. I am sure Samsung was quite happy to use the SD if it didn't have issues. I for one am glad Samsung didn't choose to put the piece of crap in the S6 Edge that I am planning to buy. Because if I had issues with it, I would have sued both Samsung and Qualcomm for both putting aproduct onto market that they new ihouse had issues. Something Apple fans refuse to do even tho Apple had sold several defective products to the public. You should be applauding Samsung foor stepping up and providing what is basically based on tests, a better working workaround to deal with Qualcomm obvious lack of quality control. Only a stupid fool would rip a company for trying to do what's best for its customers who have to buy the device vs having loyalty to another OEM.

44. CoryMeetsWorld

Posts: 170; Member since: Oct 17, 2014

Only the SD810 doesn't have heating issues. This has been proven false so many times it isn't even funny. In fact SD810 runs cooler than all of Qualcomms last generation chips, that's the 800, 801, and 805. And none of those had heating issues s a processor that runs cooler than those chips has heating issues? Please. That story has been proven to be rubbish Samsung propaganda more times than I can count. So you might want to try and do some research.

49. Cicero

Posts: 1136; Member since: Jan 22, 2014

Yep! SD 810 got cooler after downgraded frequency. And surprise SD810 almost perform like 805 which almost perform like 801 which almost perform like 800. Please check the results of benchmarks. SD got uninspired and out of ideas for now. Speaking of fanboyism on this posts and looking only on Samsung side make guys adopted this atitude the bigest fans of Qualcomm which are not different than Samsung ones. But technology will m9ve forward and all the time will be a winner or a smart player

51. o0Exia0o

Posts: 903; Member since: Feb 01, 2013

The SD-810 DOES have heat problems. The reason that most OEMs have gotten around this is by throttling performance back to that the chipset doesn't overheat. Plain and simple, that has been proven many times over by benchmarks....

53. Trex95

Posts: 2383; Member since: Mar 03, 2013

For your info SD 810 has better grapics performance than Exyonse 7420, Exyonse 7420 run Asphlat 8 on 30 fps, SD 810 on 40 to 60 fps. There's no OVERHEATING issue on SD 810 I'm using M9 and I used to own the Note 4 Exyonse 5433 version and it does has heating issue by the way even worst than SD 801.

32. boosook

Posts: 1442; Member since: Nov 19, 2012

Unless you're a Samsung fanboy: those fanboys would like to read Samsung even on their toilets.

2. Totse2k15

Posts: 478; Member since: Feb 11, 2014

The Dragon got lazy. Need to wake up!

3. iWin_Droid

Posts: 76; Member since: Jan 22, 2015

Way to go Samsung! Qualcomm has got to get their heads out of their asses, this time.

4. janno

Posts: 144; Member since: Aug 19, 2014

Indeed. This wouldn't have happened if Qualcomm wasn't asleep at the wheel, trying to squeeze Krait into a 3-year generation, rather than the regular 2 (which ending up having to rush adopting ARM's own cores and doing a poor job at that). That said, I don't think anyone said Qualcomm MIGHT spin-off the Snapdragon division. That would be incredibly stupid. Qualcomm is still a major player in the smartphone market, and I'm sure it will continue to have 40%+ market share this year even without the S6. Why would Qualcomm give up on 40% market share and still a profitable division, yet nobody is asking Intel to do the same despite losing $4 BILLION a year in mobile with no profits in sight and only like 2% market share?! What you must've read is that some analyst or shareholder group called on Qualcomm to spin-it-off. That's not the same as actually considering it.

5. robocopvn

Posts: 504; Member since: Mar 10, 2010

Totally agree. Look at what Qualcomm do in recent years. Snap 800, 801, 805 mostly the same. Haha

6. josephnero

Posts: 781; Member since: Nov 16, 2011

BusinessKorea?Yeah yeah.lol

7. TheGunnyPT

Posts: 252; Member since: Feb 12, 2015

About damm time! In this I totally support Samsung. One of the reasons I'm really hating on Qualcomm was the performance of the Snapdragon 810 which is ridicuolous. I mean we got the proof when we compare M9 with Note 4 (810 vs 805) and the Note wins almost every time besides stock apps in a real life situation. Qualcomm needs to wake up to reality they are forgetting they are carrying Sony/HTC/and many other OEMs. If the next couple of Snapdragons are gonna be in the same state AS SNAPDRAGON 810 was released, we're going to see OEMS looking for a option. And you don't wanna see MEDIATEK as an option.

11. kaikuheadhunterz

Posts: 1157; Member since: Jul 18, 2013

Don't worry, Intel will be there as an option as well :)

12. CanYouSeeTheLight

Posts: 1122; Member since: Jul 05, 2012

Not while they use piss poor GPUs, still much better than Mediatek.

15. TylerGrunter

Posts: 1544; Member since: Feb 16, 2012

Next generation of Snapdragons should be a lot better. For once they'll be using some FinFet node, not the 20nm TSMC. Both TSMC 16nm FitFet or Samsung 14nn FinFet should make the overheating issues go away. The second point is that they will using "Kyro" in the SD 820, their new cores built in house. I hope with those two improvements they will retake the lost advantage in tech against exynos. The bad news is that we don't see SD 820 in real devices till next year...

17. TheGunnyPT

Posts: 252; Member since: Feb 12, 2015

Early 2016 for 820 right? Anyways, this is a year of either go Exynos or hold back with a 805. There is not a single point to upgrade from a last year's flagship to 2015's flagship. I'm really curious for Note 5 even more now.

19. TylerGrunter

Posts: 1544; Member since: Feb 16, 2012

Yes, early 2016 for devices. SD 820 will start sampling on the second half of 2015. And I agree with the Exynos or hold back... sadly.

25. TheGunnyPT

Posts: 252; Member since: Feb 12, 2015

Really bad news for Z4 if they use 810, people should skip for Z5 or go LG G4 if Snapdragon 808 benchmarks are good.

29. rubyonrails3

Posts: 375; Member since: Oct 01, 2014

I doubt 808 would be great at least in term of battery life. SD615 is also not good with battery, SD801/805 was great in term of battery life. I'm rocking M9 which is amazing phone but my second day with phone, its not satisfactory. feeling like my Moto X 2014 does better. BTW software on M9(Sense 7) is freakishly awesome. How crisp text is (All credit goes to Orgami theme ) I guess I wouldn't have loved M9 without that theme. that theme really shows that 1080p can do better in term of crispness of text than 2K(especially so far what I've seen from samsung). you all hear M9 screen is not great. that is lie(sort of). You gonna love M9 display :)

31. maccess

Posts: 742; Member since: Jan 16, 2013

Yes the m9 display is perfectly fine.. but last year m8 still has the better colour reproduction as far as i know.. and sorry you can never compare it to the s6 display.. the s6 simply slaughter the m9 display.. i've compared it myself on the store and all the comparison from youtube is the proof what my eyes seen..

46. CoryMeetsWorld

Posts: 170; Member since: Oct 17, 2014

The S6 display is just vile. I have the M9 and the S6 and the S6 has the worse display on a smartphone I have ever seen. Ugly over saturated colours and just poor calibration.

33. Rydsmith unregistered

"that theme really shows that 1080p can do better in term of crispness of text than 2K(especially so far what I've seen from samsung)." No matter how you slice it, that is completely and totally incorrect. This is confirmation bias and just plain wrong.

36. McLTE

Posts: 922; Member since: Oct 18, 2011

Quit with the epeen measurements.. for real.. the average consumer could care less if their Z4 has a 810, 805 or 801 in it. They buy the Z4 for it's looks and feature set. If anything, it could end up in Sony's favor.. if phone OEMs are unhappy about the 810, they may get discounts on the processor and maybe with this move.. less royalties/fees. At the same time, they can still market the Z4 as having the latest and greatest processor.. Joe Blow average consumer would be perfectly happy with that.

20. mafiaprinc3

Posts: 585; Member since: May 07, 2012

If mediatek play their cars right they could move up the ranks in the mobile industry. i.e. increase their poor going performance and adapt new CPU tech and release now source code

22. TylerGrunter

Posts: 1544; Member since: Feb 16, 2012

MediaTek is alreay quite good in the mid and mid upper range. But they don't have anything competitive in the upper range. So the issues with the 810 doesn't really benefit them a lot.

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