Key Points:
- The Snapdragon 8 Gen 4 chip that will be part of the Galaxy S25 lineup is likely to increase the cost of the mobile significantly.
- The Orion CPU cores include Qualcomm’s specifications that make the chip more expensive than its rivals because TSMC uses its own 3nm process.
- It can also use its vast resources to absorb these costs to prevent them from being passed on to customers or others affected.
There are a lot of expectations from the new Galaxy S25 model arriving in the first quarter of 2024 and one of the most anticipated changes is the adoption of the Snapdragon 8 Gen 4 processor. This new chip will result in a significant increase in performance but the harsh reality is the high price.
Information from Digital Chat Station, among other journalists, suggests that the SD 8 Gen 4 chip (model SM8750) will be more expensive than the previous model. This growth is attributed to improved technology within the chip; These include the Qualcomm Orion CPU core which includes a custom CPU capable of rivaling Apple’s A and M series processors. Additionally, the chip is manufactured using TSMC’s second-generation N3E – a three-nanometer process that is also used to manufacture Apple’s upcoming M4 and A18 Pro chipsets.
The economic aspects associated with this technological advancement are quite important. Thus the display and chipset are already the most expensive components of a phone. This is another area where there could be a huge increase in the price of chipsets which may force smartphone makers to readjust their target prices.
They have a few options: as well as whether they plan to pass the cost on to the consumer, go for a less advanced chipset, or cut spending in other areas like display, camera, or battery. But there’s a problem – the expected price increase of the Snapdragon 8 Gen 4 may be too big to offset this and cut the cost of other parts of the phone.
There has been an old trend where smartphone sales rates have increased with the release of new chips. For example, in 2020, the Snapdragon 865 made Xiaomi raise the price of the Redmi K30 Pro by $140 compared to the Redmi K20 Pro smartphone.
Samsung is likely to take a hit as it has a larger supply chain and may choose to absorb the increased costs that the Snapdragon 8 Gen 4 Galaxy S25 will entail. But this may result in other improvements like cameras or displays failing in production due to cost.
In short, the Snapdragon 8 Gen 4 chip will usher in new performance opportunities, but it could also put additional pressure on Samsung and other manufacturers who need to add it to their flagship phones to be competitive.
