Royalties Trouble Ahead for Qualcomm?

According to BI Intelligence, approximately 22% of the world's population now owns a smartphone, up from just 5% six years ago. In addition, one out of 17 people around the world own a tablet now. Meanwhile, the rate of PC ownership is slowing down, while that of smartphone penetration is accelerating.

Higher smartphone ownership rates will almost inevitably lead to lower smartphone ASPs, or average selling prices. Price competition and emerging market smartphone ownership will lower smartphone ASPs. Lower ASPs will in turn mean lower royalties for companies which collect royalties on smartphone chips such as Qualcomm , Nvidia , Apple, MediaTek, Intel and Broadcom .

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