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Intel Attacks Wireless Market with Infineon Acquisition

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Intel has said that it will buy the wireless division of chipmaker Infineon for $1.4 billion, the New York Times has reported.

Infineon makes processors that are found in many mobile devices, not least the iPhone and iPad, as well as handsets from Nokia and Samsung.

The move comes less than two weeks since the world’s largest chipmaker bought security company McAfee for $5 billion.
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Analysts are viewing the move by Intel as its way of ensuring that it has a strong presence in the mobile space and Intel’s chief executive indicated this was the case.

"Computing is spreading to a wide array of connected smart devices, including laptops, cars, smartphones, tablets, smart TVs, and new categories being created almost daily," Otellini told analysts during a conference call, as reported by Reuters.

Intel has been trying to establish its Atom processors in the mobile space, but while they are the foundation of the netbook market and most likely some forthcoming tablets, the chip remains too high power for smartphones – and the Infineon purchase will enable it to have a transitional chip offering.

"It's an interesting move," Rob Bamforth, principal analyst at Quocirca, told TrustedReviews, "especially from a company that at one time thought it could use Wi-Fi and WiMAX as wireless weapons against the dominance of cellular technologies. Essentially, it could be seen as an admission that 3G, and in particular LTE, are now perhaps as important to Intel’s plans as those ‘IT descended’ wireless technologies."

Bamforth suggests that Intel could even be looking beyond smartphones as today's big thing. "The opportunity to embed processor and comms technology into an ‘internet of things’ (from smart meters to smart cars) could be particularly appealing to Intel as the volumes would be massive. PC sales look flat, and while smart mobile devices are the current ‘ thing’, it might be wise to plan for a time when they are not so up, and this could be part of that plan".

Link: Intel UK
Link: Infineon press release.

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