New chip promises $100 Android smartphones

Taiwanese chip maker Mediatek has created a single chip that contains all the major non-memory silicon components of a 3G smartphone, according to China Times. The chip is sampling now and will go into full scale production for the fourth quarter of 2010 - initially for the Chinese market, but with world sales in view.

Designed to run the Android operating system, the chip should end up in smartphones that cost as little as $100 (£70), said the newspaper. Mediatek, which designs components for TVs, optical media devices and wireless, said that it had been developing specifically for Android since the beginning of the year.

In February, it announced a strategic partnership with Microsoft to produce smartphones based on Windows Phone 6 for emerging markets and intended to be access points for multimedia. However, China Times notes, strong Chinese interest in Android has been driven by the $15-per-handset licence fee for Windows Mobile software - an additional cost that becomes more significant as hardware innovations such the Mediatek device bring other costs down.