Sources: Samsung to drop Qualcomm Snapdragon 810 and use its own chip in next Galaxy smartphone
Samsung Said to Drop Qualcomm Chip From Next Galaxy Smartphone — Samsung Electronics Co. (005930) will use its own microprocessors in the next version of the Galaxy S smartphone …
Context & Ripple Effects
Samsung had already been edging its in-house Exynos silicon into flagships — the Galaxy Note 4 LTE-A shipped with Exynos rather than Snapdragon — and this Bloomberg report extends that to the mainline Galaxy S, cutting Qualcomm's 810 out of its biggest single socket. Days later, [[a:825911|Qualcomm cut its guidance and warned investors that the 810 had been dropped from a flagship device]], confirming how much revenue rode on one design win.
What follows is the twist that defines the relationship today: within months Qualcomm moved production of its next chip, the 820, out of TSMC and into Samsung's own foundries, and struck an official manufacturing deal for the Snapdragon 820. Losing the phone socket cost Samsung little — it gained Qualcomm as a manufacturing customer.
First-order effects
- Qualcomm loses the entire next-generation Galaxy S socket for the 810 and takes an immediate financial hit, forcing the outlook cut disclosed a week after this report.
- Samsung's Exynos division wins full ownership of its flagship phone's processor, removing a supplier dependency at exactly the moment the 810 was under pressure.
Second-order effects
- Qualcomm is pushed to switch Snapdragon 820 production from TSMC to Samsung foundries, converting a lost customer into a foundry client and deepening Samsung's grip on the supply chain.
- TSMC cedes a marquee mobile customer to its Korean rival, while other Android vendors watching the Galaxy decision face the prospect of competing against a vertically integrated Samsung.
Third-order effects
- By the Snapdragon 835 generation the leverage inverts again: Samsung hoards Qualcomm's supply for the Galaxy S8, forcing rivals like LG and HTC onto the older 821 — evidence that whoever controls both the design win and the fab controls allocation for everyone else.
- If the pattern holds, flagship Android silicon consolidates around vertically integrated player-manufacturers, with fabless chipmakers increasingly dependent on the very companies they compete with for sockets.
The trend: Flagship smartphone silicon is consolidating around vertically integrated manufacturers like Samsung, whose dual role as customer and foundry lets them dictate terms to fabless suppliers such as Qualcomm.