Intel Alliance, the mobile phone chip field can roll over?

Intel, the IT giant, which has repeatedly been frustrated in the mobile chip sector, is attempting to "redeem" the mobile market by buying stakes in China's chip companies. September 26, Intel announced that it would invest 9 billion yuan (about 1.5 billion US dollars) in the holding company, which holds the communications and RDA Microelectronics, and gained a 20% per cent stake. "The investment is expected to be completed by 2015.

1.5 billion dollars, what does Intel want?

In accordance with the terms of the agreement, Intel technical cooperation, strategic layout and other key cooperation target is the exhibition, RDA will be mainly involved in product sales work. The exhibition will jointly develop and sell a series of Intel Architecture (X86) based system chips and plan to launch the first batch of Intel architecture based system chip products in the second half of 2015.

For the exhibition, we can obtain Intel's technical authorization, capital and market support, which will enhance the technology upgrading, architecture selection and process development, plant capacity and so on, and have an important supporting role in further developing the international market. "But the key is to look at Intel's technical authorization content for the show," said one senior chip industry insider.

For Intel, through a stake in the Violet Group's holding company, to achieve a stake in the exhibition and RDA, the main intention is:

1, expand the market share of mobile chips. According to Strategy Analytics, the market share of Qualcomm, MediaTek and Shanghai in the first quarter of 2014 was 66%, 15% and 5% respectively, while Intel slipped to 4th place. With the exhibition, Intel + exhibition market share will increase to nearly 10%, greatly narrowing the gap with MediaTek market share.

2, increase cooperation with Chinese mobile phone companies. China has become the world's leading mobile phone production and manufacturing base, and there are hundreds of small and medium-sized mobile phone companies. Over the years, Intel has tried to persuade small and medium-sized mobile phone companies to adopt the Intel mobile chip platform, but it has not been recognised because of technical barriers and market risks. And the exhibition and China's many small and medium-sized mobile phone brands are closely linked, Intel can use this to increase the X86 of low-end mobile chip promotion.

3, occupy the rise of China's chip enterprises "Typhoon mouth." With more than 120 billion "National Integrated circuit Industry Fund" the most integrated circuit support program in China's history, Chinese companies are becoming an important force for global chip development. Purple Light group to buy 1.78 billion U.S. dollars, 907 million dollars to buy RDA's continuous action, behind the establishment of the "Chip national team" important thrust. Intel, through its stake in communications and RDA, will directly enjoy the dividends of the rise of China's chip companies.

4, Beyond MediaTek. Through years of face-to-face competition, Intel has recognized that reliance on its own power has made it hard to surpass or even approach Qualcomm in mobile phone chips. But there is still a big chance of overtaking MediaTek by investing in and propping up the world's third-largest mobile-chip company. Intel still has the top-end design and manufacturing process in the global chip industry, and is a leading generation for Apple's OEM, and is superior to the 4G baseband chip design. The shares of MediaTek have continued to fall since Intel's share of the news was revealed.

In those years, the mobile opportunities Intel had missed

Andy Grove, the greatest CEO in Intel's history, has made a figurative metaphor in his book, "Only a bigot can survive": "In between two smoky hills, businesses are like climbers who have to climb two mountain tops at the same time." The successful enterprise, familiar with a mountain, but must go to another mountain, the way indicators are not clear, the new mountain peaks looming, how long can arrive, how can no one can know. At this time the mountaineering team is often in the valley between the Shuangfeng a fierce dispute, some people to stay comfortable and familiar with the former, someone to risk forward, the result team fell apart, the final death of the valley.

Unexpectedly "one language into Prophecy", this famous analogy has become the "destiny" of Intel in the mobile chip field.

Intel launched its smartphone chip in 2000. But next year (2006), Intel's successor, Paul Otellini, sold his 10-year XScale cell phone chip unit to Marvell, fading out of the handset chip market, for a further 600 million dollars. In the field of mobile playground system, Otellini also bet the wrong treasure, began to choose Nokia's Meego operating system, and later to switch to Android.

Looking back today, XScale was at Intel with a business that brought only 400 million dollars in revenues and 80 million of billions of dollars a year, and it was not unbearable for Intel, the IT giant. And Marvell after taking over XScale handset chip department, becomes the global in 3G and 4G domain very radical chip manufacturer. such as the first quarter of this year, the cool faction, ZTE and other mobile phone companies for China Mobile production of the first thousand 4G three-mode mobile phone almost all using Marvell platform, leading MediaTek 1-2 quarters of time, enough to see the original XScale cell phone chip division of Technology research and development strength.

The tragic thing is not over yet. Four years after selling XScale's mobile chip division, Intel merged with Infineon, the company's largest supplier of baseband chips to Apple's iphone. But the wary Apple then abandoned the Infineon baseband chip (Intel lost one of its big customers). Today, baseband chips remain one of Intel's biggest weaknesses in the smartphone (including tablet) market, which competes with rivals such as Qualcomm and MediaTek.

Corporate strategy cannot be traced back to assumptions. But Intel's repeated failures in the area of mobile chips have made the industry sigh. If Otellini hadn't sold XScale, there would never have been a single big one with Qualcomm now, and the history of global mobile chips and smartphones would have been another pattern.

Can Intel + exhibition change the pattern of mobile chips?

In the global technology and it field, still adhere to the "28 law", occupy the main market share must be the top two manufacturers. Whether or not Intel + will soon be able to complete a comeback for MediaTek is critical.

At the beginning of the article, however, Intel's technical licensing content and cooperation details will be key to this "sniper battle". Because of the U.S. government's restrictions on the export of High-tech technology to Chinese companies, Intel is afraid to discount the content and level of technical authorization. In the face of MediaTek, the best in history, it remains to be seen whether the Intel + exhibition cooperation model achieves market impact.

Mobile chip technology has changed the mobile phone, and the development of smart phones has changed the world, creating a mobile internet, such as countless market opportunities and industry leaders. Intel, the IT giant that has repeatedly been frustrated in the mobile-chip field, has been facing another world after nearly 15 years of wandering. Former Intel CEO Andy Grove has described the "10 times times turning point" faced by companies in industrial innovation: a sudden upheaval in the fundamentals of the enterprise, technology, rules, competitive environments, industry patterns ... Everything has changed.

Will Intel be able to "roll over" in the mobile chip field?

(Responsible editor: Mengyishan)