Intel Not Powering Microsoft’s New Lumia Phones

Intel chips are not powering Microsoft’s upcoming entry-level Windows 10 devices as had been thought by many. Microsoft is close to launching its new flagship and entry-level Windows 10 Lumia smartphones, and it seems the tech firm will stick with Qualcomm Snapdragon processors.

Intel’s delay to blame

A leaked Spanish language presentation slide about the upcoming entry-level Lumia 550 mentions that the device will run on a 1 GHz quad-core Qualcomm Snapdragon processor.

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Intel delayed the delivery of 4G/LTE-enabled versions of the Atom x3 to 2016, and this possibly be the reason for Microsoft’s snub, says a report from Seeking Alpha by Alcaraz Research. Previously, Intel was expected to deliver LTE-capable Atom X3 SoC in the second half of 2015. Now, it looks that the chip maker will “just have to make do by supplying its Atom x3 chips to Chinese white-box phone/phablets vendors,” the report notes.

Alcaraz Research says Intel shareholders should not expect to Microsoft to make use of the Atom x3 either this year or in the future. Microsoft CEO Satya Nadella is streamlining the Lumia line-up to very limited number of models; therefore, the Lumia 550 could be the last entry-level Lumia in 2015, the report says. This device could be the only successor to the Lumia 535, which is priced at $175.

Intel must partner with Google

In case Microsoft opts to continue its exclusive deal with Qualcomm, then Intel must try “to get in bed with Google’s ambitious grand master plan to saturate the world with affordable Android One smartphones,” the report notes. If ASUSTek remains the only global OEM to make use of x86 Atom chips for smartphones, then Intel’s long-term mobile strategy will go “in vain.”

Google’s Android One project will serve as a gateway for Intel to persuade more Android device makers to trust its Atom x3. It will be in favor of Intel if Google  subsidizes sub-$100 Android One handsets. In that case, Intel will not have to offer discounts for its processors intended for Android One partner OEMs.

Even without Microsoft’s support, Intel is a Buy as the chip maker could easily “dump its Atom x3 chips onto white-box Chinese OEMs,” the report says. However, the fact is Intel still has a long way to go in the mobile chip business, and not getting design wins from Microsoft Lumia serves as a “painful reminder of it.”