A new joint venture is being formed in China to compete with MediaTek and Spreadtrum.

Datang Telecom's wholly-owned subsidiary Leadcore Technology plans to invest CNY720 million to build a joint venture with several parties, including Qualcomm China, Jianguang Semiconductor Industry Investment Center, and Zhilu Strategy Emerging Industry Investment Center.

The cooperation is subject to the approvals of related regulatory authorities and it is expected to complete later this year.

Qualcomm will provide technologies and product portfolio to the new joint venture. The joint venture will focus on designing and selling smartphone chipsets for the mass market in China. Its businesses will cover design, packaging, testing, customer support, and sales and it will aim at the low-end market to compete with MediaTek and Spreadtrum.

Frank Meng, chairman of Qualcomm China, said that the joint venture will develop chipsets to meet the demands of 4G smartphone ecosystem in China.

Financial terms, including capitalization levels of the joint venture, were not released by the parties.