We’ll see if a similar development will take place in smartphones. Despite the similar hardware form factors, (thanks to ARM’s licensing based business model) there are a number of CPU/GPU possibilities and (thanks to Google’s willingness) OEMs are able and willing to customize the OS and the user interface. Consolidation of OEMs at the high end of the market, with Apple and Samsung as the only major players, have been faster than suppliers. The basis of competition there may not boil down to just price, making customization and better integration (along with distribution, supply chain and marketing heft) more valuable than a slight rise in costs, keeping the vertically integrated model viable. At the low end, there are a lot more OEMs willing to live with low margins, so they may be willing to buy their components in the open market for any penny of savings, but competition among suppliers have been quite lively as well. This market may lead to low margins on both sides of the table. With such a dynamic, neither MediaTek’s volumes, nor its profits may outgrow the market, unlike Intel or MS.