"The market volume has grown by a whopping 45% compared to the previous quarter and 39% compared to the same period of last year, thanks mainly to unabated iPhone sales," said Sophia Chen, the industry analyst with MIC.

In fact, Taiwanese contract manufacturers' shipments for iPhone 6 and 6 Plus have begun to reflect signs of strong demand in the third quarter, she added. Taiwanese smartphone communication IC market volume reached approximately 288.1 million units in the third quarter of 2014, up 10% sequentially.

Baseband IC market volume in the second quarter of 2014 topped around 83.7% of which were contributed by Qualcomm, down from 93% in the first quarter. MediaTek however rose from 2.1% to 8% while Spreadtrum grew from 2.2% to 6% in the second quarter.

"MediaTek's shipment growth was attributed mainly to its shipments for Xiaomi Redmi Note and HTC Desire 310 while Spreadtrum mainly benefited from the increased shipments for Mi3," said Chen.

As for application processors, the share of Apple iPhone's A-series chips reached about 84% of the total application processor shipments in the second quarter of 2014. Nvidia's share also rose to 10.2% thanks to the increased shipments for Xiaomi 3.

Beginning in the third quarter of 2014, Apple iPhone 6 and iPhone 6 Plus have begun mass production and used mainly A8 chips from TSMC. The share of Samsung's application processors therefore dropped considerably in the second quarter of 2014.

On top of that, the robust growth in shipments for ZenFone also had pushed the adoption share of Intel's application processors upward in the third quarter. Qualcomm's third-quarter share however was lower than the second quarter.

Outlook for 2015

Upon the arrival of 4G, Qualcomm is set to develop its products targeting both high- and lower-end markets, as evidenced by the releases of the Snapdragon (MSM8992) and Snapdragon (MSM8994) for the high-end market demand and Snapdragon 210 (MSM8909) for the lower-end market demand.

On the other hand, MediaTek plans to unveil the MT6735, a high-end 64-bit SoC running on ARM's Cortex A57 architecture in the first half of 2015. For smartphone brands, MediaTek is another alternative supplier aside from Qualcomm when they come to select a 4G LTE solution provider.

Having a flock of smartphones with MediaTek's 4G solutions shipped in the fourth quarter of 2014, it is forecast that there will be a noticeable increase in the number of smartphones built with a MediaTek's chip in 2015.

Figure 1