Intel Corporation Chip Partners In China To Abandon Rival Technology

Intel Corporation (NASDAQ:INTC) Chief executive Brain Krzanich expect new Chinese semiconductor partners to abandon the use of ARM technology in smartphone and tablets, and shift to Intel’s architecture within a few years, says Reuters. Earlier, the chipmaker entered into a deal with Rockchips and Spreadtrum Communications to deploy its technology for low-cost smartphone and tablets targeted at the rapidly emerging market in China.

Shift to Intel just 2-3 years away

Spreadtrum and Rockchip deal in turnkey smartphone and tablet platforms that are easy for manufacturers to use. As of now, they are using Britain’s ARM Holding Plc licensed technology that stands at the level of Intel Corp’s technology.

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Under the agreement, Intel does not place any restrictions on the chipmakers over making ARM-based chips. Krzanich pointed out to reporters on Monday that the shift in the technology is just the matter of two or three years after which these companies will use Intel’s architecture.

Together with Rockchip, Spreadtrum is underway making Intel-branded tablet SoC, with the former working on connectivity and graphics. Spreadtrum, with whom Intel inked a deal to acquire 20% of its parent company for $1.5 billion, is working with Intel on SoCs expected to be released next year. Krzanich mentioned that both the companies are relatively small, which is why they do not have sufficient resources to make separate chips on Intel and ARM technology in the long-run.

China a big market for SoCs

According to Intel CEO, the company’s technology and architecture will help the players to differentiate themselves in the market as Qualcomm Inc, which is leading mobile chip maker, offers high-end chips based on ARM, and also Taiwan’s MediaTek is flooding the Chinese market with low-end chips also based on ARM technology.

Krzanich said that it is a battle for small companies. Intel entered the mobile space late, and since then has directed its technology primarily towards tablets and smartphones. The chip maker is a dominating force in the personal computer space, but it has relatively less experience in low-power “systems on chips” or SoCs, key components in mobile devices, which combine features including processors, Wi-Fi and memory.

In the United States, demand for smartphones is saturated, so manufacturers are looking to China where there is strong smartphone demand, especially for devices priced under $150.